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Bitcoin Businesses The Almighty Buck

BitTorrent Inventor Bram Cohen Will Start His Own Cryptocurrency (torrentfreak.com) 104

Bram Cohen, the creator of BitTorrent, has showed deep interest in cryptocurrency in the past, and now it looks like he is going to start his own. From a report: Without going into technical details, Cohen believes that Bitcoin is wasteful. He suggests that a cryptocurrency that pins the mining value on storage space rather than processor time will be superior. In an interview with TorrentFreak's Steal This Show, Cohen revealed that his interest in cryptocurrencies is not merely abstract. It will be his core focus in the near future. "My proposal isn't really to do something to BitCoin. It really has to be a new currency," Cohen says. "I'm going to make a cryptocurrency company. That's my plan." By focusing on a storage based solution, BitTorrent's inventor also hopes to address other Bitcoin flaws, such as the 51% attack. "Sometimes people have this misapprehension that Bitcoin is a democracy. No Bitcoin is not a democracy; it's called a 51% attack for a reason. That's not a majority of the vote, that's not how Bitcoin works."
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BitTorrent Inventor Bram Cohen Will Start His Own Cryptocurrency

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  • Obligatory XKCD (Score:4, Informative)

    by dysmal ( 3361085 ) on Tuesday April 25, 2017 @12:22PM (#54299325)
    • by Anonymous Coward

      That's one of the dumbest xkcd comics. It totally ignores the fact that de facto standards do exist all over the place, and they're usually not the first or second or even third attempt at implementing an idea.

      Look at C++. It's the de facto standard programming language for serious software, but it wasn't the first programming language.

      Look at bash. It's the de facto standard UNIX shell, but it wasn't the first shell.

      Look at Windows. It's the de facto standard desktop or workstation OS, but it wasn't the fi

      • by Anonymous Coward

        Holy shit you're a moron.

      • by Anonymous Coward

        C++ does not meet the needs of all programs, there are many other languages used, hence XKCD is right

        Bash does not meet the needs, there are many other shells used, hence XKCD is right

        Windows does not meet the needs of all users, there are many other Desktop and workstation OS' used, hence XKCD is right

        Android does not meet the needs of all users, there is also IOS , hence XKCD is right

        Chrome does not meet the needs of all users, hence Edge, safari, firefox,vivaldi,opera , hence XKCD is right

        XKCD was not ta

        • Go ahead and name some desktop and workstation operating systems other than Windows. Linux maybe, but can it run SolidWorks or Adobe Premiere?

      • by allo ( 1728082 )

        did you even read the comic?

    • Except that in the case of crypto-currencies, you can add a few trailing zeroes after the significant number.

  • Cue Oprah (Score:5, Funny)

    by OzPeter ( 195038 ) on Tuesday April 25, 2017 @12:25PM (#54299355)

    You get a cryptocurrency! And You get a cryptocurrency!

    Everyone gets a cryptocurrency!

  • Retard (Score:5, Insightful)

    by sexconker ( 1179573 ) on Tuesday April 25, 2017 @12:30PM (#54299383)

    "Sometimes people have this misapprehension that Bitcoin is a democracy. No Bitcoin is not a democracy; it's called a 51% attack for a reason. That's not a majority of the vote, that's not how Bitcoin works."

    That's exactly how Bitcoin works.
    If you control more than 50% of the nodes storing the blockchain, you can manipulate the currency to your heart's content.
    If you do it in such a way that someone notices, people will fork the blockchain. Forking the blockchain has already happened due to other issues. And it went about as smoothly as anyone could have hoped for.

    PROTIP: If this new cryptocurrency involves any sort of premine or exclusivity period, it's a scam.

    • Re:Retard (Score:5, Informative)

      by Orgasmatron ( 8103 ) on Tuesday April 25, 2017 @12:37PM (#54299443)

      If you control more than 50% of the nodes storing the blockchain, you can manipulate the currency to your heart's content.

      Except that you can't. If you have more hashing power than the rest of the world combined, you can: change the order of transactions. That's all that you can do.

      • Re:Retard (Score:5, Insightful)

        by GLMDesigns ( 2044134 ) on Tuesday April 25, 2017 @12:48PM (#54299533)
        wish I had mod points.

        This is correct. If you have 51% of the hashing power for a period of time you can double spend (ie spend your bitcoin; take it back and spend it again - the BTC version of counterfitting). Of course if you do that you devaluate the value of BTC

        However, BTC is getting too centralized. One of the basic premises behind BTC was that anyone and everyone can mine to one degree or another with their CPU. With the advent of ASICS that's no longer the case.

        Only with CPU only hashing (ok, if you insist, GPU only hashing) will Bitcoin come close the ideal that everyone is a node and everyone has a roughly comparable stake.

        Even if I have 100,000 CPUs and you only have one we'll be more "equal" than now where you have one CPU versus people with ASIC farms.
        • by Jeremi ( 14640 )

          If I was to invent a new cryptocurrency tomorrow such that hashing can only be done on a CPU, and it became sufficiently popular, is there anything that could prevent someone from designing and manufacturing an ASIC to run that algorithm, thereby bringing us back to the status quo?

          • :(

            As far as I know. No.

            Is there anything that a general tool box can do that a specialized tool cannot? Yes.

            So.... Is the solution switching algorithms? Is it using a suite of algorithms than makes an ASIC that much more difficult to accomplish? (X11 didn't work out).

            I have NO idea.

            It may be that there is no solution to this particular problem.
            • The answer is No.
              here's why:
              Any(one)thing that can be done on a CISC can be done on an ASIC.
              If you had an algorithm that say used the L1 cache to do some funky physics based transform (nevermind that this is a *bad* idea because new steppings will change the device physics) then you could design an ASIC that had only enough compute to run the L1 cache and devote the rest of the ASIC die to having 40 or 50 L1 cache fields.

              The point of an ASIC is to be application specific, and it does that by first dumping a

              • Thx for the reply.

                As far as I understand designing and producing ASIC prototypes is costly and that you need large production runs to become profitable.

                Bear with me as I don't know what the f--k I'm talking about. (Hoping to learn.)

                So, if the coin switches from algo 1 to algo 2 ... algo 1000 would that not defeat ASICS? You would spend a lot of money creating an ASIC that would run for a short period of time (too short to be profitable to the person who purchases it). Therefore ASICS would not be
                • If the switch happened *after* the ASIC was created then yes.
                  If the algos are all defined then I just build an asic that does the following:

                  get input
                  switch (input.algo){
                  case Algo1: { foo();break;}
                  case Algo2: { bar();break;}
                  case AlgoN: { doN();break;}
                  default: {awNuts();}
                  };
                  put output

                  Sure the ASIC is bigger (and costlier), but each of those algos is a hardware implementation optimised for nothing else.
                  An ASIC is (basically) a slice of a RISC that does what you want with nothing else.

                  In fact you can think of a RISC as an ASIC implementation of CISC.

      • Re:Retard (Score:4, Insightful)

        by sexconker ( 1179573 ) on Tuesday April 25, 2017 @02:04PM (#54300105)

        Owning the network and owning the hash power are separate things.

        If you own the network, then you can lie to other nodes about stuff. Other nodes would be like "WTF?" and the network would split. But that's not automatic, and until people can trace back and find out which nodes are janky, you can profit in the chaos.

        This sort of attack needs storage and network resources, not computational resources. For a successful attack giving you a usable time window in which to take action, you would want the network to be as distributed as possible.

        With hashing power you can "change the order of transactions", sure, but as others have pointed out that means you can spend BTC you don't have, fuck other transactions, etc. This is the attack everyone worries about because the Chinese ASIC farms basically control Bitcoin at this point. But they're not controlled by a single entity and any shenanigans would again be met with a fork.

  • Missing the point (Score:5, Insightful)

    by Orgasmatron ( 8103 ) on Tuesday April 25, 2017 @12:35PM (#54299431)

    Sorry Bram, but you are missing the point. Hashing is used in bitcoin precisely because it is useless. It can't be faked, and it can't be stored for later. It is an irrevocable commitment right now.

    I wish you luck with monetizing distributed storage, or decentralized distribution, or whatever your new project ends up as. But the design of bitcoin is not a programming challenge for you to solve. It is a carefully interlocked design, made by someone (or some people) who has (or have) a far beyond average understanding of money and cryptography. Many people with less insight have attempted to "improve" things, and all have failed.

    • Re:Missing the point (Score:4, Informative)

      by slew ( 2918 ) on Tuesday April 25, 2017 @12:58PM (#54299623)

      Sorry Bram, but you are missing the point. Hashing is used in bitcoin precisely because it is useless. It can't be faked, and it can't be stored for later. It is an irrevocable commitment right now.

      I wish you luck with monetizing distributed storage, or decentralized distribution, or whatever your new project ends up as. But the design of bitcoin is not a programming challenge for you to solve. It is a carefully interlocked design, made by someone (or some people) who has (or have) a far beyond average understanding of money and cryptography. Many people with less insight have attempted to "improve" things, and all have failed.

      Well, I'm not defending Bram on his quest, but I would say that based on this presentation [stanford.edu] at least he seems to know enough to know that he doesn't know how to do it yet (which is one step above those that don't even know what they don't know yet)...

      It all may be a failure in the end, but at least there is a germ of an idea in there (which is more than I can say for most snake oil).

    • This. There is a reason why we are still using PGP, SSH, and SSL. It is because creating a new cryptographic protocol takes the best minds out there... and even then, there will be attacks that people didn't even think about like side channel stuff, quantum crypto, and other items, so the protocol always needs updating, if not a complete overhaul. Even then, old standbys like the OpenPGP format are showing their age, due to not supporting forward secrecy and using less efficient binary to ascii algorithm

    • by Luthair ( 847766 )
      Would be more interesting to see a currency tied to some meaningful work. e.g. finding new protein folds or something.
    • by Anonymous Coward

      No, you're missing the point. Bitcoin is a great design other than one aspect: it's use of huge amounts of energy to operate. That is too a design challenge to solve. Cohen has identified that you can do a proof of work equivalent using storage instead of processing. The rest of the carefully interlocked design doesn't need to change. As for it being too complex or difficult to even approach, that's just bullshit.

  • What? (Score:4, Insightful)

    by OverlordQ ( 264228 ) on Tuesday April 25, 2017 @12:46PM (#54299519) Journal

    it's called a 51% attack for a reason. That's not a majority of the vote,

    Yeah it is, that's the exact definition of majority.

    • No, if I have 51% of the money in the US that doesn't allow me to automatically elect the president because I'm the majority. Having 51% of the hashing power does not equal being 51% of the users of Bitcoin.
      • Having 51% of the hushing power means that your version of bitcoin transaction are dominate over others. Therefore you can pollute the transactions with fake transactions to your hearts content and no one can stop you. Indeed more you do it the more it will continue.

        Personally I am surprised bitcoin hasn't been bot netted into hashing yet

        • by GNious ( 953874 )

          Having 51% of the hushing power

          ....was that on purpose ?

        • sure it has, but even vast botnets of CISC x86 CPUs can't compete with GPU farms, much less ASIC farms. It is so unprofitable to do mining on CPU that botnet operators are making more money just relaying spam or DDOS. Not sure if any botnet ops are doing GPGPU mining.

      • by DarkOx ( 621550 )

        if I have 51% of the money in the US that doesn't allow me to automatically elect the president because I'm the majority.

        If you controlled 51% of the US money supply I expect you could secure whatever outcome in a POTUS election you would like.

        • According to an analysis that excludes pensions and social security, the richest 1% of the American population in 2007 owned 34.6% of the country's total wealth, and the next 19% owned 50.5%. Thus, the top 20% of Americans owned 85% of the country's wealth

          So, if a plurality of the top 20% if they agreed, would decide POTUS...
          I suppose that matches the empirical data...
          with each 1%er being equal to some number of 2-20%ers...
           

      • No, but it is 51% of the transaction validation hardware, from which you earn block rewards and transaction fees. The rewards and fees are denominated in bitcoins, so it is in your self-interest to keep the value of a bitcoin high. Fucking around with the transaction history would destroy people's confidence in bitcoin, and they would flee for something else. Demand would drop, and so would the market price. Your expensive farm full of ASIC chips, which can do nothing but bitcoin hashing, is now earning

      • by MemeRot ( 80975 )

        If you have 51% of the money in the US, I'm sure you can put whoever you want in office. Or skip that entirely and build a robot army. Government spending in all its trillions is only about 26% of the economy. You would dwarf the government in spending power.

    • Yeah it is, that's the exact definition of majority.

      Unless you're speaking about Hashing College majority. That one trumps over Popular Hashing.

  • Unless things change on the global scare, I don't think there will ever be more than one big-player in the cryptocurrency scene.

    Why do people do bitcoin? 1) To operate anonymously outside the system. 2) It is widely recognized as having value by a large enough subset of people to be exchanged.

    Whereas #1 can be duplicated, and maybe even improved upon. #2 is going to be difficult. There already IS a cryptocurrency that can be exchanged this way- there doesn't really seem to be much need to create another

    • by Anonymous Coward

      Bitcoins market share has slowly been decreasing and coins like eth and dash are picking up. This is while the overall market continues to grow. Bitcoin owns around 60 percent of the entire crypto market.

      Bitcoin is slowly slipping while others gain traction.

      While I agree bitcoin will remain the big dog for a while yet its future is anything but certain.

    • Why do people do bitcoin? 1) To operate anonymously outside the system.

      For the last time BITCOIN IS NOT ANONYMOUS. BY DESIGN.

      The whole point of bitcoin is that it is *distributed*.
      Means every single (full) node on the network has a complete copy of the transaction ledger and can independently verify that a balance is legit.
      By definition, on bitcoin network *everyone* gets to see *every transaction*.

      Bitcoin is at best pseudonymous :
      Transactions aren't linked to your Real Identity (a la Facebook), but to a public key.
      That public key require a bit of big data mining in order to m

  • by GeekWithAKnife ( 2717871 ) on Tuesday April 25, 2017 @12:49PM (#54299539)

    Why do we need a new currency?

    What is the compelling business case that BTC, ETH, LTC, NMC or PPC cannot address perhaps with an update?

    I get that everyone wants to invent a new cryptocurrency and own ten millions coins when they are worth $0.0001 until they make them a multimillionair...but really, what's in it for the rest of us?
    • >What is the compelling business case that BTC, ETH, LTC, NMC or PPC cannot address

      Err... you need to ask, "What is the compelling business case that BTC, ETH, LTC, NMC or PPC can address.

      Unless you count, 'gambling, fraud, and purchases on black markets the cops aren't watching yet' as valid.

  • by GuB-42 ( 2483988 ) on Tuesday April 25, 2017 @01:23PM (#54299821)

    ... it doesn't make Bram Cohen rich enough.

  • ...taking the failed scam that was GemCoin, and actually make it a viable thing by backing it with something other than the worthless amber which the Chinese were trying to trick everyone into thinking had value. Opals, Emeralds, Topaz, Tanzanite, Kunzite, Morganite, Jade, etc. are all highly valuable, and only need a little work to obtain. You'd probably dump far less energy in actual mining than you would running mining rigs like with current Bitcoin.

  • I thought there was still some question whether he really invented it or just took credit for it?
  • A cryptocurrency backed by something real (like storage or gold) would be nice, instead of fiat based cryptocurrency. I wasted some time trying to imagine how storage backed cryptocurrency would work, but I whiffed. Then again, I couldn't imagine BitTorrent either. I wish him the best luck.

    • The Tether [tether.io] cryptocoin ("USDT") is backed by US dollars. There is 1 USD deposited for each USDT.
      You could do just the same with physical gold.

      This has worked wonderfully in the past, until Wells-Fargo decided to block all transactions to and from Tether, allegedly for money-laundering reasons.
      https://themerkle.com/wells-fa... [themerkle.com]

      Now 1 USDT is traded for around 0.90 USD as holders are starting to get anxious because the situation hasn't been resolved for weeks.
      This, in my opinion, has also indirectly increased de

  • My uncle also made his own money and he went to jail for it.

  • Those that like the privacy of cash are going to have to use something like it. The only problem is crypto currency has its own value of sorts, like stock, and can become worthless in an instant or make you a millionaire the next day. There's also the argument that in order to be legal in most countries, some information is still having to be tied to the spender to avoid tax evasion issues, or at least that's the claim.
  • No thanks.

    Not interested.

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