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Tangled Math Beats BitCoin

A

Arthur Hanson

Well-known member
Bitcoin has some very severe problems, not only economically, but execution wise caused by Block Chain technology which constantly adds to overhead. The constant addition of massive overhead not only constantly slows the transaction time, but consumes ever greater energy and computing power. The new IOTA crypto currency should prove a good test bed for the tangled math technology. Tangled Math could easily make Block Chain obsolete in its many uses. Tangled Math could provide new markets in just about everything for the tech sector with a low overhead way of keeping track of just about everything by checking just two random past transactions rather than the entire chain. The problems with the massive overhead of Block Chain and Bitcoin in particular could lead to some severe problems not only for Bitcoin, but the tech sector for promoting and profiting from it.

The non profit German IOTA foundation has teamed up with some major technology firms to develop a decentralized data marketplace. This could be the start of numerous applications to apply this record keeping technology.

NOTE: Have you noticed the tech powers(AWS, Google, Azure, Oracle, IBM, etc.) with by far the lowest computing cost who could make by far the most money mining it, have stayed far away from it and without comment. These people are some of most intelligent and they fully realize the danger this would impose on them as being the ultimate deep pockets if a crypto currency blows up that they are intimately involved with.

https://www.technologyreview.com/s/...ckchain-has-been-built-to-outperform-bitcoin/
 
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Tangle looks very interesting, but I still group it under "blockchain and related technologies". Note that Tangle, while it does not have a blockchain, still has a distributed ledger. Clients are still have to compute hashes, ect. So the underlying technology is very much inspired by blockchain. It's one of many improvements to the bitcoin protocol, where bitcoin was merely a proof of concept and other coins based on similar ideas have emerged offering much higher speed, capacity, and improved capabilities.

Think of it like this - Bitcoin is like vacuum tubes that made up the first computers. Todays computers no longer use vacuum tubes but they are still computers. The crytpocurrency space will continue to grow and evolve at breakneck speed, it's like the internet in the 1990s, or computers in the 1960s.
 
Also, did you notice how the largest tech companies with the deepest pockets (Microsoft, IBM, Intel) completely ignored mobile at first?
 
The difference is with electronic networks you can conduct monetary transfers around the world in different currencies at far lower costs in a fraction of the time with many legal protections public and private with insurance along the way. Do I trust an unregulated miner in a foreign country with no protections public or civil, NO.
 
Arthur Hanson said:
The difference is with electronic networks you can conduct monetary transfers around the world in different currencies at far lower costs in a fraction of the time with many legal protections public and private with insurance along the way. Do I trust an unregulated miner in a foreign country with no protections public or civil, NO.
Click to expand...

You are demonstrating a profound ignorance of how it works. No single miner would be able to corrupt or otherwise interfere with your transactions unless they had more than 50% of the network hashing power. There are weaknesses in the centralized parts of the system (like exchanges), but as long as you are using a trusted wallet where you control your own keys, you are quite safe. The question is why would you not trust the power of the network, but trust the governments, banks, and insurances companies that have violated it over and over again?

My guess is you are just sucking on some sour grapes for missing the most important technological revolution since the internet, in spite of being a futurist when it comes to every other aspect of technology. I don't much care about bitcoin personally, the core developers have been captured and are ruining it. Many improvements have since been made in the space, like IOTA which you mentioned here. But blockchain and related technologies are going to give rise to a new crypto economy, that will eventually, in my opinion, eclipse the all other economies in the world put together. It's a far more important technology than IOT, VR, and AI. In fact, it will further enable those technologies.
 
count said:
You are demonstrating a profound ignorance of how it works. No single miner would be able to corrupt or otherwise interfere with your transactions unless they had more than 50% of the network hashing power. There are weaknesses in the centralized parts of the system (like exchanges), but as long as you are using a trusted wallet where you control your own keys, you are quite safe. The question is why would you not trust the power of the network, but trust the governments, banks, and insurances companies that have violated it over and over again?

My guess is you are just sucking on some sour grapes for missing the most important technological revolution since the internet, in spite of being a futurist when it comes to every other aspect of technology. I don't much care about bitcoin personally, the core developers have been captured and are ruining it. Many improvements have since been made in the space, like IOTA which you mentioned here. But blockchain and related technologies are going to give rise to a new crypto economy, that will eventually, in my opinion, eclipse the all other economies in the world put together. It's a far more important technology than IOT, VR, and AI. In fact, it will further enable those technologies.
Click to expand...

I have no problem missing out on the Bitcoin mania and have done very well this year. I also feel the block chain distributed ledger system is highly inefficient and unsuitable for large scale finances on a world wide basis and doomed to fail to meet the hype that borders on hysteria. People and organizations trying to do large transactions are having a difficult time and the transaction time is extremely slow compared to traditional transactions. I would not want to participate in something that I will feel will hurt people with little understanding of finance. My views are not just my own but people of such note as Peterffy of Interactive Brokers. I have seen numerous financial schemes over the years and most end up badly. I'm even concerned about countries running perpetual deficits that are almost like a pyramid/Ponzi scheme. Many governments finances scare me and the purpose of many governments is to take care of themselves. Just look at state and local perpetual deficits around the country and around the world. Venezuela and Mozambique come to mind, but so do New Jersey and Illinois. Politicians have no problem running up debt that won't come due after they are long gone. This is just part of human nature for many, create and leave problems for the next generation. I am especially leery of people that declare themselves saints and heroes. I do hope Bitcoin doesn't hurt to many. Conjuring money out of thin air is an interesting concept.
 
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You are looking at transaction capacity at a single point in time, it's like saying "these vacuum tube computers are far too inefficient, they use so much energy and take up so much space, they will never replace traditional calculations with slide rules". Yes, bitcoin is extremely inefficient, supporting only about 3 transactions/second. The bitcoin cash fork supports 24 transactions/s, with a clear roadmap towards ~500 transactions/s within a year, with on chain scaling. After that, transactions per second can continue to increase as bandwidth, storage, memory, and CPU improves. I think a 2000 transactions/s blockchain, is only a few years away and 20,000 transactions/s - comparable to Visa - will appear within the decade. So stop worrying about speed and capacity.

In terms of hurting people, or people losing money, lots of people lost money during the dot com bust. Lots of people lose money funding startups. Lots of people are going to be hurt by the disruptions cause by AI/ML but you are all in on those things. Yes, there are many scams out there capitalizing on the hype. Most of these crypto currencies will end up becoming worthless. Maybe bitcoin itself will end up being worthless. But the surviving internet companies, like Google and Amazon, along with the companies that rose from the ashes of the tech bust, are now worth trillions. And the cryptocurrency market will also eventually be worth trillions, or perhaps tens of trillions. Here is why I think that:

Blockchain is not about money, it's about transactions. Transfering a unit of value is the simplest transaction, but any transaction that can be digitized can be executed on the blockchain. Furthermore, blockchain, current capacity constraints aside, potentially offers a multiple order of magnitude improvement in how transactions can be executed. You eliminate the overhead of third parties, you eliminate the principle agent problem, transactions can be instantaneous, and you have an unprecedented ability to automate them. If you have a multiple order of magnitude better way of executing transactions, it's likely that all transactions that can be done on blockchain, will be done on blockchain. And with automation and AI, even transactions that we don't traditionally think of as digital (like transportation) can be digitized - you could have a self driving car app where the car gets its instructions on where to go from the blockchain.

Now think about services. The fundamental unit of a service is a transaction. Put another way, a service can be thought of as an interlinked set of transactions that create value. And if the transactions involved can be executed on block chain, then the service, in whole or in part, can also be executed on the blockchain. So you will see all manner of services being migrated to the blockchain.

Consider how important services are to the economy. In developed countries they are 70%+ of GDP and trending upward. In the not too distant future you can expect 80-90% of global GDP to be services. Imagine if 50-60% of those services were executed on the blockchain. That would make the blockchain economy worth 40-50% of global GDP. The blockchain economy could become bigger than all national economies put together.

It's not hype, this is the most important trend since the internet itself.
 
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<msreadoutspan class="msreadout-line-highlight msreadout-inactive-highlight">I agree, many people loose money in and on </msreadoutspan><msreadoutspan class="msreadout-line-highlight msreadout-inactive-highlight">financial</msreadoutspan><msreadoutspan class="msreadout-line-highlight msreadout-inactive-highlight"> markets or instruments all the time <msreadoutspan class="msreadout-word-highlight msreadout-inactive-highlight">dealing</msreadoutspan> with known risks. I have lost in the six figures</msreadoutspan> many times, but have succeeded far more, as have others. Except for the occasional Enron, WorldCom, etc. these are based on audited figures or with stated risk, unless it's pure venture capital. Tangled Math is far more efficient than Block Chain, and their are several other ways of accomplishing the same process much more easily and efficiently. Bitcoin and other crypto currencies have many, many severe problems and the people have found transaction times in transactions of any size to consume even several hours if executable at all. I have the financial channel on from five in the morning till after closing at one and hear of totally convoluted transactions that take inordinate time and some couldn't be executed at all with no pricing transparency many times if not most as in transactions of size unless the time is in hours. This is what I do for a living and have done full time for ten years and part time for thirty. The power Bitcoin consumes is equal to the country of Serbia. Only time will sort things out. Stocks have risk, as any other investment, even hard objects like gold, copper, cattle futures and wheat have risk, but most are reality based with limited fraud or misconceptions. Few who invest in Bitcoin could even explain it accurately. Check out the article below that is a very simple explanation of how tech has fundamentally changed the financial world temporarily in terms of history.

https://www.forbes.com/sites/carrie...-driving-the-equity-bull-market/#3630245b68de
 
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I agree that Bitcoin has some major weaknesses that are unfortunately not being addressed by it's core development team, who were bought by a bank and are now focusing on a side chain approach to scaling, one that has settlement layers and appears to be more of a business model resembling traditional banking than a real scaling fix. I personally don't agree with the Bitcoin core approach and have moved on.

There are many other approach that have strengths and weaknesses. There is Tangle, which you mentioned, along with sharding, which is being pursued by Ethereum. Tangle and sharding have a few things in common in that they distribute the ledger, but a few differences as well. Sharding is still based on the traditional blockchain idea, where Tangle is more of a connected graph than a chain. There are strengths and weaknesses to both. Tangle will need to reach a certain critical mass of adopting before it has any chance of succeeding, and even then it is relatively unproven. Then there is the monolithic blockchain approach, which relies on increases in computing power and decreases and storage and bandwidth costs over time to be able to scale. Personally, I see no reason why the monolithic approach can't carry us forward for the next 5 years at least. I think we can easily get to 1000 transaction/second capacity with a monolithic chain.

We are early days in an important revolution, and there will be winners and losers. Fortunes will be made for those who successfully identify the winning technologies and avoid the scams (of which there are many), and one has to accept that most of these coins will end up worthless. But it's a market where you can take 1-2% of your money and make 1000-10000% on it. If I lose everything I have invested in the space, it's meaningless for me, but if this becomes even a fraction as big as I think it will be...
 
Focusing on price or on particular crypto currencies is myopic By that measure, IOTA is down even more in % in spite of it's advantages. I'm gradually investing into the most promising coins and tokens, focusing on those that offer solutions for scaling, smart contracts, privacy, messaging, and distributed exchanges. I'm less focused on how much money I may make or lose, and more focused on the long term technological revolution that we are in. Losing the tiny fraction of my money I'm putting into this doesn't bother me as much as not participating in the most important technological trend since the internet.
 
We fear what we do not know. It has always been like that and it will always be so.
We should stop thinking about the Bitcoin as a currency that people can use to buy or sell things. Of course you can, but it would be a misuse.
Bitcoin is more like gold, an asset to keep in the own portfolio to differentiate the investments. A risky one for sure, but with a huge revenue potential.
There are plenty of other altcoins to be used if we are interested in the e-commerce, bank transactions or distributed communication.
Ethereum can use smart contracts to generate secure and fast transactions without a third party involvement/interaction. To send and receive money across the world, the best option is most likely Ripple. For the internet of things there is IOTA. Bitcoin was simply the first. Saying that it is slow for transactions means we did not understand it. I do not buy a burger with gold. Technically speaking I'm not even using dollars to buy goods on Amazon, I do that with a credit card and the underneath circuit. The new circuit is the ledger and it is safer and cheaper (and it is going to be faster). You can send money in another continent in less than 5 minutes with Ripple (now it takes days and many dollars). Think about blockbuster and netflix. There is no such a thing like too big to fail. Banks in fact are already trying to invest in this new revolution. Bitcoin is not the One Ring, it has its own use cases. It will be soon obsolete in terms of blockchain technology, but it will always remain the crypto gold standard, so to me, it is not going to die (explode).
 
astilo said:
We fear what we do not know. It has always been like that and it will always be so.
We should stop thinking about the Bitcoin as a currency that people can use to buy or sell things. Of course you can, but it would be a misuse.
Bitcoin is more like gold, an asset to keep in the own portfolio to differentiate the investments. A risky one for sure, but with a huge revenue potential.
There are plenty of other altcoins to be used if we are interested in the e-commerce, bank transactions or distributed communication.
Ethereum can use smart contracts to generate secure and fast transactions without a third party involvement/interaction. To send and receive money across the world, the best option is most likely Ripple. For the internet of things there is IOTA. Bitcoin was simply the first. Saying that it is slow for transactions means we did not understand it. I do not buy a burger with gold. Technically speaking I'm not even using dollars to buy goods on Amazon, I do that with a credit card and the underneath circuit. The new circuit is the ledger and it is safer and cheaper (and it is going to be faster). You can send money in another continent in less than 5 minutes with Ripple (now it takes days and many dollars). Think about blockbuster and netflix. There is no such a thing like too big to fail. Banks in fact are already trying to invest in this new revolution. Bitcoin is not the One Ring, it has its own use cases. It will be soon obsolete in terms of blockchain technology, but it will always remain the crypto gold standard, so to me, it is not going to die (explode).
Click to expand...

Look at Interactive Brokers, they can do everything crypto currencies can do with far faster speed and much more safety. You can trade around the world almost instantly with safety and confidence.
 
Semiwiki may be obsolete. Here is a story about a Norwegian entrepreneur that has developed a revolutionary semiconductor process (and I assume chip design) that will take over more than 50% of Bitcoin mining - bye bye security.

Here is the link:

Norwegian entreprenour plans to put chinese miners out of a job ! atleast some of them :p - BITCOIN - The Bitcoin Pub

Story should probably be taken with a grain of salt.

With 50% of the mining power they will be able to corrupt the chain. It seems to me that wasting so much energy on something that could be provided if people could work together and agree on legal rules is not a good idea.
 
smeyer0028 said:
It seems to me that wasting so much energy on something that could be provided if people could work together and agree on legal rules is not a good idea.
Click to expand...

So you are dreaming that having agreement in legal rules between different jurisdictions within states and between states all over the world is the easy solution ?
 
Scale and economic power

The potential for crypto currencies to redefine commerce is so huge it is hard to "see" as we have grown up in the Plato's Cave of thousands of years old "money". To have ultra cheap and 100% reliable value transfer opens up the world to commerce and opens commerce to the world (as in the physical IoT world). It boggles the mind. To deny that is to say you don't need Google because you had a phone book already.

So now how do we get there? I am a believer that Moore's Law is over in terms of cost effective and power efficient scaling, so we will rely increasingly on software tricks or quantum computing to move forward. It is, as is often the case, the irresistible force meeting the immovable object. Note how in his comments about changing FaceBook Zuckerberg included these comments: "There are important counter trends to this -- like encryption and cryptocurrency -- that take power from centralized systems and put it back into people's hands ... I'm interested to go deeper and study the positive and negative aspects of these technologies and how to best use them in our services." In short, he seems sort of worried that cryptocurrencies can turn FB inside out. Also note how after way too many years in power the CEOs of Morgan Stanley and Goldman Saks are rumored to consider retiring this year. Still waters can run deep.
 
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