I was looking for more information, but I can’t find a site that has a visualization of the forks in the blockchain. Something like this, but with real numbers and more information: http://imgur.com/WNmNtaH
possibility it was a scam, the original post says you should sell before it crashes, someone could pick them up cheaper if the post caused a big sell-off
(not even sure if u can buy aur idk anything about it)
So... there's now two 'ledgers' of Aurororacoin? I get PKI and P2P but cryptocurrency is new to me. Why would you ever want to fork a ledger/blockchain?
I read a bit through the forum discussion and the part I find fascinating is that new cryptocurrencies, with low hash rates, are seen as targets ... and that there are high-hash-capability persons and organizations that will attempt to "break the bank" so to speak ...
Which leads me to conclude that any new cryptocurrency would need to be launched by an organization that had the computing power to defend the currency (assuming it follows resource-intensive mining paradigms like bitcoin et. al)
> "Which leads me to conclude that any new cryptocurrency would need to be launched by an organization that had the computing power to defend the currency (assuming it follows resource-intensive mining paradigms like bitcoin et. al)"
So, you're saying that there should be some kind of powerful institution that is capable of defending the currency against manipulation attempts if necessary and thus ensures a reasonable level of stability in said currency? This concept seems somewhat familiar, you might even consider it a crypto currency's Central Bank.
What I find funny w.r.t. to BTC et al. is that people are slowly starting to find out that living in the currency equivalent of the Wild West is not as much fun as it sounds at first. First, there were calls for more government regulation and a higher level of accountability on the side of infrastructure operators and now even the idea of some entity defending the currency against attacks seems like an attractive prospect.
My prediction is that at the end there will be an epiphany that our real world currency system is constructed the way it is for a reason. It may not be perfect, it certainly has some major flaws but at the end of the day it's still better than the alternatives.
I've been in BTC trading for two years. Never has anything been wrong with btc proper, it is always with centralized businesses around it, with the exception of the double spend fork of the blockchain during that one version upgrade early on, which was a valuable lesson for future upgrades like the recent 0.9 transition, which went smoothly.
And no, central banks are awful. That is one of the myriad reasons distributed compute power is what makes bitcoin strong. And ironically, central banks are autocratic and blockchains are democratic, while the systems that consistently produce the former are purported republics, and blockchains just come from no ideology or power structure, I guess anarchy.
> My prediction is that at the end there will be an epiphany that our real world currency system is constructed the way it is for a reason. It may not be perfect, it certainly has some major flaws but at the end of the day it's still better than the alternatives.
The current system is giving a monopoly on printing money without any backing store of value besides the confidence in the printer to a select few easily exploitable and corruptible appointed heads of central banks with no mechanism for the fair distribution of new funds. These banks then operate through violence to guarantee peoples assets to falsely make the currency look more secure than it is, by threatening you if you don't pay the taxes to recoup the losses of risk in storing your money with someone else. Is it an arms throw from the worst possible system, which would be the absence of any confidence at all, and it is only with systemic manipulation such a system still works at all. That, and the US dollar is the compulsory international currency for oil, which everyone craves like a cocaine addict without a fix.
> The current system is giving a monopoly on printing money without any backing store of value besides the confidence in the printer to a select few easily exploitable and corruptible appointed heads of central banks with no mechanism for the fair distribution of new funds.
I think that there's a certain amount of truth to this - countries are able to shape their currency according to their interests. For example, China deliberately keeps the yuan weak in order to stay competitive with exports. This tends to benefit the elite and dick over the poor. However, I think that a cryptocurrency is a bad alternative to this, due to the next point:
> These banks then operate through violence to guarantee peoples assets to falsely make the currency look more secure than it is, by threatening you if you don't pay the taxes to recoup the losses of risk in storing your money with someone else.
Having a system of enforcing contracts is essential to having a working currency. You are basically saying that banks are being evil when they repossess and foreclose on property, but if they weren't allowed to do so, they wouldn't lend money in the first place. And like it or not, credit is essential to the functioning of a society; it's been around in some shape or form since the ancient Egyptians. We've come a long way from having a private army come to your house to sell your family into slavery, but it's the same thing in principle - we sign contracts and are held to them. These contracts need to be regulated with the force of the government. There's a large web of mutual obligations here - the government forces banks to lend responsibly, and in turn the government guarantees through the courts and the police that it will enforce these contracts.
Bitcoin doesn't have any of this. And that's why it's so volatile and why speculation drowns legitimate transactions.
> Having a system of enforcing contracts is essential to having a working currency. You are basically saying that banks are being evil when they repossess and foreclose on property, but if they weren't allowed to do so, they wouldn't lend money in the first place. And like it or not, credit is essential to the functioning of a society; it's been around in some shape or form since the ancient Egyptians. We've come a long way from having a private army come to your house to sell your family into slavery, but it's the same thing in principle - we sign contracts and are held to them. These contracts need to be regulated with the force of the government. There's a large web of mutual obligations here - the government forces banks to lend responsibly, and in turn the government guarantees through the courts and the police that it will enforce these contracts.
>Bitcoin doesn't have any of this. And that's why it's so volatile and why speculation drowns legitimate transactions.
I don't understand. Bitcoins are just an asset so they have all of this under the law. You can't steal people's bitcoins legally anymore than you can steal someone's tv or gold or whatever.
The ability to have easy credit was the foremost event which brought about the consumer era. Reverting back to a defacto gold standard would be a retrogression on a scale rarely witnessed in the previous few centuries.
I'm no fan of Bitcoin, in principal. I agree with you; it's flawed as hell long term, for multiple reasons I won't go into here. But boy, is it ever nice to work with. Several of the companies I have business with now support BTC payments, and all I do is click on the link, which opens up my Coinbase account with all the fields pre-filled, hit one more button and it's done.
Not easier than, say, Amazon, where I buy something every week at least, have my card information saved and make sure I keep it updated when it expires, etc. But, if it's a new place, where I just have to make a one-time payment, I'll choose BTC every time if it's offered.
Are these vendors pricing their product/service in BTC or USD/local equivalent? How much extra are you paying over the traditional costs for the ease of a bitcoin payment? At some point the volatility and cost of obtaining bitcoin will outweigh the ease of use. I'm curious to know where that might be.
Everything is USD equivalent, and you have like 5 minutes to make the payment so that the price can't fall too far before they cash out on the other end. haha
But it works fine. I have like $40 in my Coinbase account. It bounces around, and I don't really keep track of it. It's not like I'm holding my savings in there. Just enough so I can make small payments when I want to.
> My prediction is that at the end there will be an epiphany that our real world currency system is constructed the way it is for a reason.
This line of reasoning is sketchy at best given that a "decentralized ledger" could not have possibly been considered as an option when the current system was built (it was not known such a system could even exist). If you had said the same thing about email in the early days ("my prediction is that our real world mail system is constructed the way it is for a reason") you would have been dead wrong.
> So, you're saying that there should be some kind of powerful institution that is capable of defending the currency against manipulation attempts if necessary and thus ensures a reasonable level of stability in said currency?
There is a distinction to be made between a central bank that is controlled by an individual country (which may or may not be accountable to its population) and a decentralized institution that is ruled by mathematic, totally transparent and spans multiple countries.
There are also ways around the potential 51% attack threat for smaller crypto-currencies which include piggy backing off Bitcoin's network hashing power (http://bitcoin.stackexchange.com/questions/273/how-does-merg...) or using Proof of Stake instead of Proof of Work.
A consortium of businesses could maintain control, with no one entity owning the blockchain. As much fun as it is to think about Joe Farmer with an ASIC or GPU, when there's a $7B+ market cap to tap, real interests will get involved.
This is exactly right. Having been in Bitcoin for 3.5 years, I have personally witnessed quite a few other altcoins being killed because of majority attacks. I have been explaining this to people as a reason why Bitcoin has a huge first-mover advantage as it has a very strong hashrate already backing up the network.
The reason I ask is because I'm curious: technological artifacts don't usually have the sharp line between life and death that most biological lifeforms do, particularly in the case of software which can potentially lie dormant indefinitely as a static bitstream. However it seems to me crypto currencies should have a sharp line, because as I understand it, the process of block mining serves as a heartbeat; the cessation of the heartbeat should serve as such a line. I'm wondering whether that is actually the case; what really happens when the heartbeat of a crypto currency stops?
Wait, why can't that miner simply unilaterally switch to a better algorithm? Especially if the switchover isn't drastic, the ledger could be effectively destroyed before the minority notices in time to do a clean fork.
Better, what's the difference in someone holding a massive amount of compute at their beckoning and using it in a similar way? The answer is, there is no difference. Power is power.
Any new cryptocurrency that uses an existing algorithm (SHA256 or scrypt) needs to be merge-mined to prevent it from being immediately attacked. An alternative is for new cryptocurrencies to use new algorithms that existing pools don't support.
It works only if you convince most (in terms of hashing power) pools and mining operations to merge mine your coin. Otherwise 51% is obvious and simple.
The actual mining is done by clients using software like cgminer; the pools just coordinate. If the software doesn't support a particular POW algorithm then it would have to be updated and tens of thousands of people would have to install the update. Also, there are pools that auto-switch between different scrypt currencies to mine the most profitable one, but mining software doesn't (currently) auto-switch algorithms.
While this is true for desktop mining and to some extend, gpu mining, largest and most powerful pools use ASIC boxes which are not re-programmable. Some hash algos perform better than others on gpu depending on the parallelization potential.
Ok, so you could theoretically "defend" your new cryptocurrency by basing it on an algorithm that nobody has ASICs for yet, and by the time there are ASICs, its probably defended well enough by mass adoption at that point (otherwise nobody would bother to make an ASIC for it).
I thought the same. I'm wondering whether it's possible to secure a coin with hashpower without artificially drastically increasing its difficulty - as I understand the mining does that securing, but can it be secured without affecting mining? My guess is probably not, but I'm not completely sure. It seems like it'd be hard for a coin to catch on if it skips the CPU and maybe even GPU mining phases completely - but maybe that's necessary to secure a new coin.
Sounds about right, at least for PoW-based blockchains. IMHO this is a good thing. Most of these coins offer marginal advantages over Bitcoin itself. It's in everyone's interest to consolidate on the most valuable, and thus typically most secure blockchain and least volatile cryptocurrency.
It is in the interest of the early adopters. For those not involved yet that have never mined before it might be more fun / interesting to adopt a new coin, for which there are no ASIC implementations.
Everything I would want to buy I can pay for with a free international credit card my bank issues. The only real incentive to use a cryptocurrency for me would be for things like giving and receiving online tips, like a site independent karma system, but as soon as you need to actually buy the coins from somewhere it is just as convenient or inconvenient as tipping fiat money.
I think a project like Ethereum, which should be in full swing by the 4th quarter of this year will solve this issue. The Ehtereum network can secure against the 51% attack, and alt-coins can be implemented on top of it for just this purpose, and the ease of implementation, since Ethereum comes with a full scripting language. Ethereum isn't an alt-coin - it is a system to create 'smart contracts'. One such smart contract could be the implementation of a coin like AuroraCoin. Any alt-coin you can think of should be able to be implemented on the Ethereum network - and the chances are they will even be more feature rich because of the EtherScript language.
Shouldn't the takeover risk be priced into a new cryptocurrency?
If coin price > mining cost / 2, it becomes worth it to acquire 51% of mining capability so you can vote the other 49% to yourself, no?
But then again, once you have 51% control and everyone knows it, the value of those coins quickly goes to zero. As is probably happening with Auroracoin as we speak.
But you can doublespend whatever coins you've got, and reject all other transactions, so the effect is the same. (You're right though, I phrased that incorrectly with "vote.")
Well not zero, just below half the mining costs, right? As long as it's below that, you still lose more taking over the new cryptocurrency than you gain. And that's also not taking the price drop post-takeover into account, which affects how much the attacker could actually cash out.
But yeah, it would seem that miners of new cryptocurrencies should expect to lose money initially.
You just need to secure it with something other than proof of work, which is vulnerable to these 51% attacks. Proof of stake isn't, mostly because if you own 51% of the currency, the last think you want to do is devalue it.
This is "just" a scheduled hard fork that went bad. The developers made a backwards incompatible change to the protocol and presumably, a sizable part of the network forgot or refused to update their client.
While altcoins are more vulnerable to 51% attacks, 51% attacks do not result in hard forks. Hard forks can only happen when two or more incompatible clients are simultaneously used by the network participants.
51% attacks are easier to pull off during hard forks because the network's hashing rate is essentially split between the chains but there is no evidence that such an attack has occurred.
If you'll permit me to put words into your mouth, I think that you're expressing your disdain for this mindset.
Currency needs to be stable in order to have long-term prospects. The dollar is stable because everyone believes that the dollar will be around in some shape or form in 10, 20, 50, 100 years. I'm currently investing in a retirement fund whose outlook is focused on 2055. Many other people are doing the same.
If you don't have this stability, your currency isn't really a medium of exchange; it's a commodity to be speculated on. And, well, as long as you GTFO of the commodity, it's perfectly fine if its value plummets or goes to zero. But something of this form will never become a currency because everyone thinks like this. It's just going to be a way for smart people to separate fools from their money.
The root comment on this thread wasn't taking advantage of the instability of Auroracoin; it was taking advantage of a gold rush of other opportunists and the certitude (reasonable, and, as it turns out, correct) that the Auroracoin experiment would fail, leaving anyone who bought and held the instruments holding the bag. In other words, a pump-and-dump scheme.
Is it similarly immoral for an investor to put money into a startup that they "know" (highly suspect) will fail?
No one knows what will happen, even if they claim they do. The options aren't only "know it will go up" or "know it will go down". That was my point that you were so dismissive of.
That's an interesting and, I think, complicated question. It's easy to uncomplicate it though; for instance, posit that the "investor" not only "invests" but also talks the "investment" up. Deliberate deception for profit has another name: fraud.
I think that's what a lot of these alternate cryptocurrencies are doing. People get in early and hope that there are enough fools who get in late to sell their massive holdings to them. Then these same people try to do the same to other people down the line. Eventually, it becomes clear that there are no more people to buy into the alternate currency, and the entire thing shits the bed.
I'm not sure where you draw the line between a "currency" like this and Bitcoin, but I think it's important to look at what the bulk of transactions are for. Bitcoin, despite rampant speculation, is still used for some things - avoiding Paypal, drug transactions, etc. Litecoin is more on the speculation side, but still has a fair amount of use. Dogecoin has its use on Reddit. But a lot of these other coins are only for speculation, and it's basically gambling to put money into them and hope that you get out before everyone goes "Well, that's all, folks! We're done here!"
What I love about cryptocoins is that so many "book smart" people hate them. Bringing up the topic is an awesome way to find out who's stubborn and closed minded.
Lately I've been using this topic as my "VC test" to decide what VCs I want to work with in my company's next round of investment, and my startup has nothing at all to do with cryptocoins :-)
My comment was subtle perhaps to the point of being cryptic, but there was actual logic to it. Even if I was a believer in cryptocurrency, the comment I responded to was problematic.
Your comment, on the other hand, simply asserts that anyone who hates cryptocurrencies is "stubborn and closed minded". That might be true, but for such an inflammatory argument, you probably want some evidence to support it.
So there's logic behind the emotion, eh? :) Something eliminates the unknown and just leaves clear facts and logic? Yes, this is perfectly what I mean.
I'm most impressed by the very smart man who is able to say "I just don't know". Book smart people you'll meet will usually reduce their world down to just 2 options: good or bad, will succeed or will fail. Where's the 3rd option? -- unknown, unknowable, we will see, no emotions because I just don't know.
Admittedly, for most of my life I was never able to find a reason to believe that this 3rd option is a real thing. I always felt that "unknown" is just a temporary placeholder and that the answer is always really there, somewhere, if you're smart enough to see it. Never in all of my schooling was "unknowable and there's nothing we can do to find out" a legitimate answer.
Well, I'm not telling anyone how to think. I'm just fascinated that some people think in these 2 modes, and some in 3.
Think of it this way, you create a bunch of purple 20 dollar bills and convince most(51%) of the population that your purple bills are the only legit ones.
So people begin transactions with only the purple bills and green bills are worthless outside their little town(subnet)... but then someone else splits up these people again and convinces 51% that red bills are the only legit one.
So now we have this mess where transactions and various business deals were made with green, purple and red bills and everyone is arguing about which color to accept.
There's no sensible way to resolve this without nearly two-thirds of people being screwed... so you need to wipe everything out and start from the beginning. Which is lost resources for almost everyone.
So there's no good ending. Any solution to this will cause over 50% of Auroracoin-holders to lose everything.... this is absolute worse-case doomsday scenario, assuming someone did a 51% attack with their own blockchain that may or may not be based on the original. If it's a fork of original, those who didn't trade and have their coins in offline wallets will be on all forks.
That's an exaggeration. People who haven't traded since the fork haven't lost anything. If it's caught quickly and resolved, only some of the people who did trade since the fork lost something.
An obvious workaround would be for the major exchanges to make sure they're on the same fork and stop all trades if anything goes wrong, until it can be fixed.
Of course, the secondary effects from loss of reputation are a big problem.
>>People who haven't traded since the fork haven't lost anything. If it's caught quickly and resolved, only some of the people who did trade since the fork lost something.
T̶h̶e̶ ̶p̶e̶o̶p̶l̶e̶ ̶w̶h̶o̶ ̶h̶a̶v̶e̶n̶'̶t̶ ̶t̶r̶a̶d̶e̶d̶ ̶s̶i̶n̶c̶e̶ ̶t̶h̶e̶ ̶f̶o̶r̶k̶ ̶w̶o̶n̶'̶t̶ ̶l̶o̶s̶e̶ ̶a̶n̶y̶t̶h̶i̶n̶g̶ ̶_̶I̶F̶_̶ ̶t̶h̶e̶ ̶f̶o̶r̶k̶ ̶t̶h̶e̶i̶r̶ ̶c̶o̶i̶n̶s̶ ̶a̶r̶e̶ ̶o̶n̶ ̶i̶s̶ ̶t̶h̶e̶ ̶o̶n̶e̶ ̶c̶h̶o̶s̶e̶n̶ ̶a̶s̶ ̶l̶e̶g̶i̶t̶. Also, the people who keep coins in exchanges(against advise to do otherwise), if the exchange is operating on a losing fork... all costumers are kinda screwed.
But you're right that if action is swift enough and some authorative-group of people can say "use this fork and ignore the other two", then minimal damage will be done.
If this is not dealt with early enough.... ever second that goes by all kinds of transactions are taking place and if all major exchanges are not on the same fork, the exchanges running on a losing fork(and all its costumers) are in for some bad times. My guess is they'll probably have to pick the fork that has the most exchanges running on it. Or, if what I've read is correct and Auroracoin is premined... then those premined coins must be rescued.
We'll see in the days to come what ends up happening...
EDIT: To those who replied below me, you're right. If you haven't traded your coins are on all forks.
If you haven't traded since the fork, then all your transactions are on the, um, "handle" part. Both sides of the fork will have all of your transactions, so they aren't lost.
yeah, roughly. but also you have the effect that if you know precisely why some red bills pop up you can start a new fork for the green bills. so a 51% attack is by no means terminal. if an attack is terminal all coins on all chains are worthless, because the remaining network can be attacked again.
Right now you could buy some auroracoins on cryptsy, try to sell them elsewhere and they would not be accepted because cryptsy and the seller are on different forks.
It's usually recoverable by patching the wallet software, so that it recognize the block that caused a fork as an invalid one, so it will be skipped and not taken as the good one.
That was caught very quickly and due to a software bug instead of a 51% attack, which is the impression that I'm getting concerning Auroracoin's current problem.
For every new fork, is like that you have doubled the money in your wallet. Unfortunately, if you pay with the same money two different people, those two people can't trade that money together because they looks the same. And so you are splitting users that can exchange money in small groups, over and over again.
It was just one person who stated there was multiple forks, it was several posting on Reddit and Bitcointalk. A few them are developers. The hash rate jumped instantly from 1.6 GBS to more than 50gbs in a matter of a minute or two. There were clearly multiple forks for a time.
Yes, it’s sinking, but this drop is caused by another problem.
The pessimistic interpretation says that this is caused by a pump and dump scheme.
The optimistic interpretation says that Auroracoin was heavily (50%) premined. The premined coins were stored and the amount was approximately 100x the amount of the new coins. In the last 4 days they started to distribute the premined coins to the Islanders. So the amount of circulation coins increased heavily, and the price dropped. It’s like inflation.
I don’t have the actual numbers, but I think that the distribution of the coins was unsuccessful. If it were successful the price would have fallen even more.
No, Bitcoin and its successors are made to handle this exact scenario from the beginning. It's common on every coin. There would be no cryptocoins left today if they weren't made to survive this. Don't call me mate.
Why do you think coins like Bitcoin require you to wait an extremely long time for "confirmations"? Why is an arbitrary number of "confirmations" chosen as "probably good enough"? This is exactly why. Forks can happen constantly. These coins are eventually-consistent by design.
This was a planned hard fork, as you can see on the Auroracoin forums[1]. The fork was planned on block 5400, which happened today[2].
[1] http://forum.auroracoin.org/viewtopic.php?f=8&t=129
[2] http://blockexplorer.auroracoin.eu/block/74546cee7f93595d36a...