I'm disappointed that the article doesn't point out that this is really a nice, round, negative 10 BTC if you work out the overflow (in satoshis).
> The rapid implementation of the patch was vital in keeping Bitcoin a viable cryptocurrency. 184 billion Bitcoin would have devalued the currency completely, leaving it at the mercy of the person holding the newly-minted Bitcoin.
It would have become worthless, sure, but I imagine that other people would have also just gone around creating additional batches of 184 billion BTC and driving the project into the ground, rather than letting one person walk off with effectively the entire thing.
Could all the large centralized mining pools (ghash and the like) plus exchanges like coinbase and binance blacklist or burn the 184B BTC? Didn't ethereum do something similar to revere a $600M "hack" a while ago?
- 2.4 million bitcoins are lost forever. Their owners, for one reason or another, can't access their wallets. No insurance, no guarantees, nothing.
- 1.1 million are owned by a mysterious person who sits at the top of the pyramid.
- 2.3 million belong to investors and speculators, who make money by pumping and dumping.
- 1 million are owned by banks, the same institutions the mysterious man said his system would replace.
- 1.6 million are held by whales: billionaires, money launderers, narcos, weapons dealers, and so on.
- 1.4 million are still left to be mined, but only a handful of rich people with servers worth millions can actually mine them.
- The rest are owned by individuals who see it as a long term investment.
- It's a digital currency most people don't use to buy or sell anything. The only ones making transactions are banks, investors, and the rich.
- And if you own even a tiny bit of bitcoin, and read something like this, you go ballistic and end up siding with the banks, investors, and the rich to keep the system going.
I can't think of a worse system to fight inequality.
but.... but.... isn't it supposed to be immutable? It did something that the code allows for (because supposedly, code is law) which some others didn't like, so they agreed, out of band, to change stuff, instead of realizing that that is exactly the problem when you treat code as law. So they doubled down
>> It took just five hours before a “soft fork” was rolled out
This is the dumb part about today's crypto imo. It is just a type of consensus among humans. People like to say its "all math" or some fundamental property of nature but that isn't true at all. It is a constant in a text file + people agreeing on its value. I.e. if a sufficient number of people agree that "we're bumping it up to 1 billion now", that is how many there would be. The argument really is how much better is this mechanism than other stores of value? Fiat currency is also a number where some people are given a magic wand to make more of it up on the spot. Gold is something that you either store in your house and hope that it is real or have someone else store it for you (or pretend to store it). Real estate is fine until the city / government decides that you don't own the title anymore. Basically it is a comparison of one absurd mechanism vs other absurd ones but perhaps Bitcoin is less absurd in the final analysis.
Some arbitraries are better than other arbitraries. For bitcoin, you'd need 50% of supply to arbitrarily make decisions which is a pretty high threshold, and for all its faults, there hasn't been any egregious soft forks on bitcoin for almost 20 yrs.
That's not how Bitcoin works at all. No amount of the supply (or hashpower) can let you make arbitrary decisions.
Having 50+% of the hashpower could let you double spend by mining on two forks in parallel, but it will never let you change the rules of the protocol, since these are defined on clients run by many people.
In fact that is what happened in the article. Someone realized there was a problem, got everyone to change their clients, and it changed. The first person to notice the bug did not need to hold any Bitcoin at all to make this change.
There is nothing wrong with having 50% of the supply. The protection is based on the distribution of hashing power. An attacker with 51% of the hashing power can double spend, but cannot "arbitrarily make decisions".
It’s a dumb PvP game that you can try to beat! But so is everyone else! Now nation states are competing against each other and the private sector!
Bitcoin is a mind virus that’s working. It co-opts human minds and synthetics to support itself. If you understood that perspective, you would have contributed to its growth earlier, others get it later.
I've been asking for quite some time what the fundamental difference is between BTC and BCH that would warrant such a price difference. I've not heard an answer that has satisfied me yet.
I’m surprised they don’t spend more time taking about the “soft fork” that voided the coins. For all the talk about the immutability of bitcoin transactions, it’s worth mentioning that things were once a lot more fluid.
I think orphaned blocks still happen regularly? Although blockchain.com's graph drops to 0 in August 02017, I think that might just be a bug in their metrics collection.
>> That Satoshi himself intervened, and did so so quickly, showed that Bitcoin was not as easily hackable as some might have assumed
I don't know if this is the central takeaway I get from this. Moreso it shows Bitcoin dodged a bullet, in that there was still a central figure or group with enough clout to roll back and fork the chain.
Even if it was caught by the bullet, the weakness would then have been fixed and the network eventually grown again in its new robust form. The people that knew this would have bought more bitcoin in the price crash and ultimately be heavily rewarded for keeping faith in the system.
I think it's US$21.7 trillion? That's now about 15% of the total global money supply.
So, it's good that the transaction was undone, or 15% of our planet would now be owned by some hacker.
(To be real: if they had not undone the transaction immediately, then the price of Bitcoin would have collapsed, and probably that would have been the end of Bitcoin)
Hackers could have redistributed their coins to the existing wallets in the same ratio their balances were at the time of attack, keeping some coins (say, 1/21) to themselves as a reward. The outcome would've been: the hackers become owners of 1/21 of all bitcoins ever; Satoshi either keeps his 1/21 or is left with 1/184000 (depends on the implementation); everyone else sees their balance increase 20k times overnight. bitcoin/fiat exchange rate drops the same 20k times, so noone has lost any fiat value. Block rewards immediately become essentially worthless; mining becomes 100% fee powered.
Quadrillion, not trillion. ~200 billion * ~100 thousand = ~20 quadrillion. So, about 15,000% of the global money supply. (I had to look it up in case BTC actually lost 99.9% of its value and I just missed the news.)
The 184 billion BTC overflow bug is a reminder that even “immutable” code is only as trustworthy as its review process. The real miracle isn’t that a bug happened, but that Satoshi patched it in hours and the network agreed to roll back. Decentralization is great, but consensus is everything
BTC has occasionally obtained community driven patches by distributed consensus rather than a centralized approach (as recently as 2021 with the Taproot soft fork). When Quantum Computing finally becomes a threat to BTC, there will almost certainly be a distributed consensus to update the protocol again. Now what happened with Ethereum could be argued as not so decentralized since the organization (Ethereum Foundation) has extremely strong political influence over the corporations that support it.
Indeed. Permissionless blockchain is much less of a technological innovation, but more of a governance innovation, specifically an accountability sink, where instead of a named entity (corporation, institution, person) being in charge, you have this amorphous blob in charge that does come together if its interests are affected (this 184 bn Bitcoin bug, the DAO hack, etc.), but otherwise even in the presence of heinous crimes shrugs and says: "who, me? what can I do?"
I don't understand why that's so attractive to so many participants - possibly because the enormous negative externalities of such a thing more often than not don't fall on themselves, but other, more vulnerable people.
(Not always though: when 200 Bitcoin were stolen from ultra-libertarian Bitcoin developer Luke Dashjr, he came crying for help from the bad bad centralized FBI rather quickly...)
> ...until someone exploited a code defect and took the founders' money, then they re-write history and ignored the hypocrisy.
Not everybody agreed - and so the Ethereum Classic blockchain was created, causing all the problems that go hand in hand with having different, forked blockchains:
That's different because in Bitcoin's case there was a clear violation of the specification, of how it supposed to work. So the bug was fixed to make the software working as it intended to be. If there were two node implementations then one would just stop to work until fixed.
In Ethereum's case there were no violation of any specification. In fact there were no bug in the blockchain itself. Just someone took founder's money, they didn't like it and so they decided to get them back. And note that after that, there were bugs in the nodes code that were breaking the spec (which you should compare to the bitcoin's bug), but because of multiple node implementations only some of the nodes stopped and so we don't care about those issues.
That's probably more important than worrying about bugs in the code. There will be bugs, the concern is what are the rules for rectifying the damage done by those bugs. Plus, where do I go to appeal if I disagree with the decision?
It’s based on a social consensus only, the rest (Nakamoto Consensus, PoW, longest chain, difficulty adjustment, block halving, artificial limited supply, decentralization, censorship-resistant P2P network, open source, etc.) is a combination of a Rube Goldberg machine & crypto bros LARPing.
There is a huge scientific merit of the algorithms for reaching a distributed consensus when not all participants can be trusted (including the fact that the Bitcoin paper uses game theory to give evidence why malicious entities attempting to create another fork will by the mere design of the algorithms have a hard time).
What is, of course, social consensus are some aspects about what it "socially" means that there exists this concrete consensus in the blockchain. By the design of the protocol and its data structures, there do exist boundaries concerning possible "social interpretations" of this consensus, but a lot of aspects are up to different interpretations.
Yes, but no. The Rube Goldberg of PoW isn't just for show, it's a protection from Sybil attack (not that it makes the economics of it any less of a disaster).
That "rube goldberg machine" is what makes social consensus possible in a distributed system where everyone is anonymous and there's no single centralized authority.
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> The rapid implementation of the patch was vital in keeping Bitcoin a viable cryptocurrency. 184 billion Bitcoin would have devalued the currency completely, leaving it at the mercy of the person holding the newly-minted Bitcoin.
It would have become worthless, sure, but I imagine that other people would have also just gone around creating additional batches of 184 billion BTC and driving the project into the ground, rather than letting one person walk off with effectively the entire thing.
Deleted Comment
- 2.4 million bitcoins are lost forever. Their owners, for one reason or another, can't access their wallets. No insurance, no guarantees, nothing.
- 1.1 million are owned by a mysterious person who sits at the top of the pyramid.
- 2.3 million belong to investors and speculators, who make money by pumping and dumping.
- 1 million are owned by banks, the same institutions the mysterious man said his system would replace.
- 1.6 million are held by whales: billionaires, money launderers, narcos, weapons dealers, and so on.
- 1.4 million are still left to be mined, but only a handful of rich people with servers worth millions can actually mine them.
- The rest are owned by individuals who see it as a long term investment.
- It's a digital currency most people don't use to buy or sell anything. The only ones making transactions are banks, investors, and the rich.
- And if you own even a tiny bit of bitcoin, and read something like this, you go ballistic and end up siding with the banks, investors, and the rich to keep the system going.
I can't think of a worse system to fight inequality.
The banks won.
Dead Comment
This is the dumb part about today's crypto imo. It is just a type of consensus among humans. People like to say its "all math" or some fundamental property of nature but that isn't true at all. It is a constant in a text file + people agreeing on its value. I.e. if a sufficient number of people agree that "we're bumping it up to 1 billion now", that is how many there would be. The argument really is how much better is this mechanism than other stores of value? Fiat currency is also a number where some people are given a magic wand to make more of it up on the spot. Gold is something that you either store in your house and hope that it is real or have someone else store it for you (or pretend to store it). Real estate is fine until the city / government decides that you don't own the title anymore. Basically it is a comparison of one absurd mechanism vs other absurd ones but perhaps Bitcoin is less absurd in the final analysis.
Having 50+% of the hashpower could let you double spend by mining on two forks in parallel, but it will never let you change the rules of the protocol, since these are defined on clients run by many people.
In fact that is what happened in the article. Someone realized there was a problem, got everyone to change their clients, and it changed. The first person to notice the bug did not need to hold any Bitcoin at all to make this change.
What?? Are we just going to forget about BTC, BCH and BSV? Same thing happened with Ethereum too - with Ethereum (ETH) and Ethereum Classic (ETC).
Bitcoin is a mind virus that’s working. It co-opts human minds and synthetics to support itself. If you understood that perspective, you would have contributed to its growth earlier, others get it later.
I don't know if this is the central takeaway I get from this. Moreso it shows Bitcoin dodged a bullet, in that there was still a central figure or group with enough clout to roll back and fork the chain.
You can't hold down superior money.
So, it's good that the transaction was undone, or 15% of our planet would now be owned by some hacker.
(To be real: if they had not undone the transaction immediately, then the price of Bitcoin would have collapsed, and probably that would have been the end of Bitcoin)
$21tn in bitcoin isn't going to get you any more money than $1tn would.
Imo not great, not terrible.
why? It's not like btc has anywhere near the trade volume for 15% of global money supply.
There are still influential people, but none with the authority of Satoshi himself.
I don't understand why that's so attractive to so many participants - possibly because the enormous negative externalities of such a thing more often than not don't fall on themselves, but other, more vulnerable people.
(Not always though: when 200 Bitcoin were stolen from ultra-libertarian Bitcoin developer Luke Dashjr, he came crying for help from the bad bad centralized FBI rather quickly...)
[0]: https://en.wikipedia.org/wiki/The_DAO
Not everybody agreed - and so the Ethereum Classic blockchain was created, causing all the problems that go hand in hand with having different, forked blockchains:
> https://en.wikipedia.org/wiki/Ethereum_Classic
In Ethereum's case there were no violation of any specification. In fact there were no bug in the blockchain itself. Just someone took founder's money, they didn't like it and so they decided to get them back. And note that after that, there were bugs in the nodes code that were breaking the spec (which you should compare to the bitcoin's bug), but because of multiple node implementations only some of the nodes stopped and so we don't care about those issues.
You don't need to exaggerate so strongly.
Is there a tiny community of a couple of nodes running the original network?
There is a huge scientific merit of the algorithms for reaching a distributed consensus when not all participants can be trusted (including the fact that the Bitcoin paper uses game theory to give evidence why malicious entities attempting to create another fork will by the mere design of the algorithms have a hard time).
What is, of course, social consensus are some aspects about what it "socially" means that there exists this concrete consensus in the blockchain. By the design of the protocol and its data structures, there do exist boundaries concerning possible "social interpretations" of this consensus, but a lot of aspects are up to different interpretations.
Dead Comment