RE: Why Raiblocks Will End as a Pump & Dump
You gained a new follower today, looking forward to going through some of your analysis, and glad to have ya on Steem. I really need to start watching more analysis videos, I've been enjoying them a lot over the holiday break :)
However, I don't agree with many of ways you've presented the data or the rational that this is just a pump and dump. I figured I'd leave my thoughts as to why, since I absolutely love a good debate.
First of all, the comparison to Steem and Bitshares isn't represented well. You are right in pointing out that Steem has incredibly high transaction volume (at a peak of 1.3m transactions), which is higher than any other blockchain that I know of. However, when you do the math on that, you'll see that 1.3m transactions/day is only about 15 transactions per second. Thats a long ways away from the 604m transactions/day that a 7000 TPS blockchain can produce. Steem and Bitshares are arguably close to each other in terms of transaction speed, but neither of them are anywhere close to what RaiBlocks has been proven to achieve. There's also the issue that both Steem and Bitshares are filled with non-transfer operation types, which can fill up blocks fast and could create delays in confirmation.
Why is RaiBlocks different? It's because it's not a blockchain like Bitcoin, Steem or Ethereum - it's something fundamentally different and new, a block lattice (or DAG).
These legacy blockchains you mention (Steem/etc) all have sequential numeric blocks which are produced by the block miners/producers, and those entities are allowed to produce blocks through PoW, PoS/DPoS, or some similar method. Users submit transactions to these producers for inclusion within the next block on the blockchain. Their transaction is included (if space permits), then subsequently confirmed, to prove that it's a valid transaction as it propigates through the network.
At the core, almost all adoption related issues can be attributed to this flaw within this model of the blockchain - limited space and time. It's also the reason that adoption is actually decreasing in the case of Bitcoin (primarily fees today, but also block speed/size). It doesn't matter how great you make the Bitcoin wallet's UI, how many stores accept it, or how many people are doing transfers to one another - the blockchain itself is the source of the frustration in nearly every case. Tweaking these values every time scaling needs to occur isn't a solution to the problem either, and Lightning doesn't solve any problems since it still requires the same fee/wait to open or close a channel. The model these blockchains follow creates inconveniences and a dependency upon whoever or whatever is creating each block (or until you move off-chain, like Lightning).
This next generation of cryptocurrencies, like RaiBlocks (and IOTA), no longer follow this model. Instead of a relationship between a user and block producer, in which the user submits operations to the block producers, they are one and the same. The user themselves now create new portions of the chain (or Tangle in IOTA) in the form of "blocks" (or Tips in IOTA). The only wait for inclusion is now based on the time it takes for your machine to create and validate that transaction and then broadcast it. Blocks are never full and there's no fee market to compete against.
Technologically, in my opinion, it's a superior way of including data within a publicly distributed and decentralized ledger.
The frenzied hype and most of the garbage you read on the internet doesn't talk about any of this because most people don't really understand what's actually happening or how it works. Most people are seeing fast transactions that don't cost them a dime, so that's what they're talking about. Once you dig deeper into the technology you'll start to realize what's magical about it and why smarter money is betting on RaiBlocks to upset many other currencies. At least that's what I see in this current rise :)
Also - one last point I'd like to make regarding something you said (@7:52) regarding Steem/Bitshares and adoption. I believe the adoption of RaiBlocks has already been much more rapid than either Steem or Bitshares. To compare apples to apples, out of the ~18.5m blocks within the Steem blockchain, only 3.3m (3,327,919) transfers of STEEM or SBD have actually occurred since it's creation in April of 2016. RaiBlocks at this point is at 2.3m (2,371,871) transfers of XRB which is not too far behind. Steem's been more widely used for much longer than RaiBlocks, so I'd imagine that at this point, there are more transfers on RaiBlocks per day than there are for Steem. There's no good way to look up this data at the moment so I'm speculating, but you can't rule it out and just say that these chains are more widely adopted.
To close, I have high expectations for all of the currencies you've mentioned. As a Steem witness myself, I obviously am cheering for all of the graphene chains to find success, but new advances in technology like this can't just be ignored and deemed as a P&D :)
This is a great comment and I really appreciate you taking the time to write out a very clear description of the technology that RaiBlocks runs on.
I noticed that one of Crypto Investor's points was that scalability is something that is always solved in time, and though it is somewhat true for centralized technologies, the case for Bitcoin is far from the typical, and the LN is not even close to being the decentralized scalability solution that Bitcoin has been searching for.
First of all, how does LN work? If Alice wants to send money to Bob, they have to open up a payment channel on LN, which involves both of them sending money into a special Bitcoin address, after which they can exchange bitcoin so long as the channel is open, and eventually close it in order to "commit" the transactions on the main blockchain (hence the "off-chain" nature of the LN).
You can link multiple channels like so: if Alice <-> Bob and Bob <-> Stacy, in order for Alice to pay Stacy, Bob would have to pay Stacy first, and Alice would reimburse Bob (in order to see why this actually works in practice I recommend reading the LN whitepaper or this series of articles on the LN: https://bitcoinmagazine.com/articles/understanding-the-lightning-network-part-building-a-bidirectional-payment-channel-1464710791/).
All of this is supposed to be over a distributed network, but unfortunately LN will never be in a position to scale to a million users, let alone 10/100 million.
First: in order to create a payment channel, you actually need to do an on-chain transaction in order to place bitcoins in escrow. If you plan on only doing off-chain transactions, it's basically not possible, because these bitcoins must be sent on-chain in order for the channel to get set up.
Second: payment networks don't scale. Suppose we want to support 100,000 users. In this iteration of the LN, we can have a user with one payment channel to 10 other users, with no redundant connections (i.e, no cycles in the network). This means that the maximum amount of "links" we need to make in order to set up a channel between two users U_1 and U_2 is 5, but we needed 10 payment channels to have this property.
However, this isn't the only setup for the network. You can drop the number of channels from user to user, but you'll have to increase the number of hops - for example, if instead of 10 users we connected each user to 2 other users, we'd have a binary tree which would have depth log_2(100000) ~= 17, meaning that we would need at most 17 hops in order to connect any two users in the network with a payment channel.
A large number of channels (in CS terminology, the branching factor) means that users would have to divide up their funds over all of these channels in order to even use them. A large number of hops means that all of the users' bitcoins will be locked up routing everybody else's bitcoin. Especially since, in a hop, there is effectively a loan going on because we use network time to eliminate risk: Alice can only send money to Bob once she is sure that Bob has paid Stacy, otherwise we'd be in trouble.
In addition to this, every single hop that we make over the network must have sufficient funds in order to make this lend possible - for example, if Alice wanted to send 1 BTC to Stacy but Bob doesn't have that much, we can't use Bob for this payment channel, and have to find another one.
So you can see that, at least from this very quick explanation, the LN makes nothing better for (decentralized) scalability. It lends itself very well to centralization because then exchanges can act as the middlemen that ensure that enough bitcoin is in all the required payment channels so that merchants are able to use them, but I don't see any merchant ever using the LN anyways, because it has to commit some amount of Bitcoin for each channel, which is not feasible for many day-to-day businesses or even big corporations (Starbucks, for example).
So my point is, if RaiBlocks has indeed "solved" the scalability problem, it will be extremely good for crypto as a whole because we can actually use the damn thing to pay for our groceries.
A great writeup and you highlighted my thoughts exactly regarding LN, I couldn't have said it better myself. I deleted a couple paragraphs from my original response that actually echoed some of these exact same thoughts because I was getting too word-y :)
I really wish I could say the same about IOTA, but it's in a semi non-functional state and is a painful experience to use.
Thanks for sharing your opinion about Iota. The whitepaper fascinated me so much I was thinking about opening an account on some exchange to buy a little. Still might but feeling less urgency now.
Regards,
Rick
It has a lot of potential and I'm still hopeful but I don't think there's a rush to buy IOTA. I personally hold IOTA and will continue to do so. But - I have a feeling it'll slide down a bit more before it jumps any higher. I'm a terrible trader though, so don't take my investment advice for more than it's worth :)
I, too, am a terrible trader. I want to be a buy and hold investor but that has caused me to ride too many positions to zero or near there.
So I treat every position as a trade and let the ones that work become investments. The market finally convinced me that controlling my losses was more important than maximizing my gains. That took a while because I appear to be a slow learner.
I take your advice as freely given and nominally value it at cost. ;-)
Regards,
Rick
We have TREMENDOUS doubts in our mind bitcoin will fix it's scalability issues. This author states it, but that doesn't make it true, and his claim is unsubstantiated. for one thing, crypto will eventually be a para-legal mechanism, and anything requiring PEOPLE to "fix" it technologically, will be a legal hot potato.
Raiblocks attempted to solve most problems from the getgo, and make it so a committee of people didn't have to change ANYTHING, and part of this vision resulted in raiblocks laser-focus on CURRENCY-ONLY, not platform or nifty use-cases.
We attempted to simplify the raiblocks discussion, read our article here...
We enjoyed your writeup, even if we disagree a little bit.
Here's more on raiblocks, we think it's pretty cool, even tho you're right that it could be a pump-and-dump, but then again, so could ANY cryptocurrency. It MIGHT be better than bitcoin tho, read why...
https://steemit.com/cryptocurrency/@harpooninvestor/raiblocks-master-crypto-series-because-everyone-deserve-their-own-blockchain
You hit the nail on this semi-article comment @jesta. One of the things that I like about you the most man (nah, I'm a straight guy bro) is that you're not blinded by blockchain fanaticism towards your own house, given the fact that you are a Steem witness yourself.
You actually bring in the facts into the table without hiding anything unlike others who tend to cherry pick facts just to preserve whatever vested interest they might be trying to uphold.
I come across this post--which is apparently dated almost one month ago already because I was searching for answers as to why Raiblocks has been continuously demonstrating a stellar price surge despite the whole market is down.
Keywords such as Raiblocks vs anycoin has led me to this post--and I'm not even surprised why Google is presenting me this page, we all know Google is tailoring their algorithm based on browsing history.
Going back, this article has actually a lots of loopholes within its arguments. I can spot them immediately upon first reading of it--and I know it cannot hold a candle the moment you try to examine the validity of those arguments very closely. In the end, it hasn't lived up to what the tittle was supposed to be doing. It's either the author was lacking the sufficient understanding at the time he's writing this or this article was driven by his dogmatic emotion around the possible circumstances.
To be clear, I am against his opinion not because I have a considerable stake in XRB, but because I simply love to approach things objectively based on merit. In fact I don't even own a single XRB coin, which is unforgivable since I stumbled upon this platform way back in November, last year--back then it only costs a dime. Shame on me though!
There are two things that I find about this coin somehow unappealing for long term and adoption side.
It has a poor branding.
The total number of coin supply is relatively very low for this type of instant and fee-less protocol. It undermines the very purpose of being a utility currency for everyday use. It should instead be at least 1 billion total supply or even more!
But thankfully they've re-branded it into Nano which I have just discovered today. I find it awkward but at least it's better and it best describes what the coin is about--capable of nano transactions without breaking a sweat, without charging a penny.
To end this rant, I'd like to thank you man for the in-depth insight about the Raiblocks technology and I surely will try my best to get at least a handful of Nano coins once the price corrects. I'm thinking of dumping my AGI for this solid project.
Not a problem, pretty awesome that you ran across this article via a google search! :)
Regarding #2 - there's been a lot of talk of "moving the decimal" to address that problem. Currently XRB (errr NANO I guess?) is using Mxrb, but could easily be changed to kxrb, which moves the decimal to the right by 3 places. In the current system:
1 Mxrb = 1 XRB = 1000 kxrb
But it could easily be changed so that:
1 Mxrb = 1000 XRB = 1000 kxrb
More info on the units themselves that are compatible with the blockchain can be found here:
https://github.com/clemahieu/raiblocks/wiki/Distribution,-Mining-and-Units
Now I understand it. This also applies to IOTA as well if I'm reading it correctly, right?
On a side note, I'm wondering what is your assessment on Blockstack? How is it different from EOS or can it even be considered a full-time competitor?
Their project sounds very legit and mesmerizing based on my initial impression, not to mention they have Edward Snowden on board.
Would love to hear your thoughts on this. Thanx!
Yup! Pretty much any blockchain can pull this trick off to some degree.
I haven't looked deeply into blockstack - but I do know they have some existing platforms that are pretty interesting and could be adapted to their own blockchain. I don't think it's as robust of a solution as something like EOS, but more focused sort of like Steem. Again, I've probably spent less than an hour reading about them, so I could be wrong ;)
I think you're missing the point - as the video explains there is little practical value (at the current time) in a feature that increases transaction limits regardless of how clever it might be at a technical level. If it doesn't provide a market advantage that can entrench it for the long haul it's nothing but a fanciful distraction until the next contender comes along incorporating the very same ideas but with more whistles.
There's an alt-coin singularity event on the horizon - maybe 2-5 years out - where big problems will have been solved and all of the best-of-breed approaches will have amalgamated into the surviving protocols (just as has happened with every single software platform in history, laying waste to the competition). My bet is with cryptovestor on this one - for better or for worse it will be successive versions of ethereum and bitcoin that are left standing, the rest is just a game of musical chairs.
I'm would argue Cardano over Ethereum, but like you said, it's going to be the big coins that incorporate the little coins' technologies/advancements that come out on top. Though it's still early, so maybe the Google/Microsoft/Apple of cryptocurrencies hasn't been born yet.
One thing to keep in mind is that you can't just always "incorporate" a feature from one blockchain to another, since there are incompatibilities that arise from the fact that blockchains have an immutable history.
We have TREMENDOUS doubts in our mind bitcoin will fix it's scalability issues. This author states it, but that doesn't make it true, and his claim is unsubstantiated. for one thing, crypto will eventually be a para-legal mechanism, and anything requiring PEOPLE to "fix" it technologically, will be a legal hot potato.
Raiblocks attempted to solve most problems from the getgo, and make it so a committee of people didn't have to change ANYTHING, and part of this vision resulted in raiblocks laser-focus on CURRENCY-ONLY, not platform or nifty use-cases.
We attempted to simplify the raiblocks discussion, read our article here...
We enjoyed your writeup, even if we disagree a little bit.
Here's more on raiblocks, we think it's pretty cool, even tho you're right that it could be a pump-and-dump, but then again, so could ANY cryptocurrency. It MIGHT be better than bitcoin tho, read why...
https://steemit.com/cryptocurrency/@harpooninvestor/raiblocks-master-crypto-series-because-everyone-deserve-their-own-blockchain
Is there anything I can read to understand IOTA and or RaiBlocks from a laymen perspective? I can go as deep as it get, I just can't read code.
I wish I had a list of bookmarks so I could just drop a link or two, but I don't have anything immediately on hand.
The easiest way I can explain it is that blockchains are a 1-dimensional path (from block 1 -> 2 -> 3), with a specific target time between those blocks. DAGs (which both IOTA and RaiBlocks use) jump to a 2 or 3-dimensional model, where instead of a set progression, the ledger itself expands infinitively in all directions.
The above is a decent representation of the difference.
Interesting analogy. I'll feel like I need to read more on them.
This video is a great watch for newbies:
What is a graphene chain?
It's an older name that Bitshares/Steem used for the core code behind them. I think now a days it's called AppBase or (something)Base in almost all of the variants. Bitshares, Steem, Golos, Peerplays, EOS, Decent, Muse, Karma, Scortum... there's a lot of them.
Graphene probably isn't the best term to use since they've all modified the core at this point, but it's stuck in my vocabulary :)
HOW ABOUT IOTA. HOW ABOUT HSR?
I agree with most here, but I feel the urge to educate you a little bit. IOTA and RaiBlocks claim to have instant transactions and no fees. For IOTA the tangle still has to be saved somewhere. The founders say, it should be able to store data on the tangle. So you need access to the whole history. But if there is no mining and no fees, who is going to download and store the whole tangle? If transactions are free, this means: free storage. The tangle will grow exponentially with free transactions. Same with Raiblocks. That's a huge conceptional mistake, no one seems to care about. Why would anyone download and save the tangle, if there is no incentive? IOTA has so called perma nodes and even has to use a coordinator node to handle the technical problems, which come with this promises. Both these solutions are the highest form of centralization. You have to understand that whenever someone tells you about free transactions and super fast and high scaling, the trade offs are most like found in censorship resistance and decentralization. If you just buy on their promises, you will get burned. You think they are revolutionary, because they use cool buzzwords, but you only know very little about the technology and the related problems. Moreover, Ethereum can reach thousands of transactions per second in small private networks. This has nothing to do with the real world.
> Why would anyone download and save the tangle, if there is no incentive?
Why do people run Steem seed, bitcoin or ethereum nodes? What about seeding torrents? There's no incentive to any of these either, yet people do it.
The reason people run these network nodes is because they want a reliable on-ramp that they control to access the blockchain, which is the same reason you'd run a IOTA or RaiBlocks node. Every business or advanced user that utilizes these networks ends up running a node, which decentralizes it to some extent.
> IOTA has so called perma nodes and even has to use a coordinator node to handle the technical problems, which come with this promises.
I can't defend IOTA's coordinator, as it's one of the biggest problems with their technology as I see it. The only reason I mentioned IOTA a few times is because it uses the same technology principals as RaiBlocks, albeit in a slightly different way. IOTA promises to remove the coordinator at some point in the future, but we'll wait and see if/when that actually happens. If they don't, it's a huge problem.
> You think they are revolutionary, because they use cool buzzwords, but you only know very little about the technology and the related problems.
I hope you're not addressing me directly, because I know plenty about the technology behind these products, both in their advantages and disadvantages. I do my research and surround myself with others that do the same. I don't buy into marketing hype.
Edit - Also I just noticed you're a brand new user, welcome to Steem! :)
Originally posted in the /f/undefined forum on chainBB.com (learn more).
Thank you. I am referring to all the persons, jumping on the hype train.
Bitcoin and ethereum network is run by miners, which will earn money for handling transactions and downloading the whole blockchain. If you have a 100 Terabyte Tangle, do you think people will download it just for good will? You mentioned seeding torrents is done without incentive. It is not. It is one of the biggest problems of torrents. Try to download a random torrent and it will be offline 90% of the time. It is exactly the problem I am describing. Blockchain should be persistent. To reach this goal, people need an incentive to download and store the data. No fees makes no sense here. I read many arguments against it and they are all based on good will. Well, I don't want to take the bet, that some people just want to make this world a better place and will invest millions of dollars, just to keep the network alive, without gaining direct profit from it.
There's a lot of em, that's for sure. I can't argue the fomo/hype is out of control at this point - but not all of us just stumbled on this stuff in the past 30-60 days :)
I don't believe this is true, though I'd love to see any information that says otherwise. The network itself is actually decentralized via people running full nodes. The miners are just the ones producing the blocks and earning the rewards. It only takes one (or a few, if you want failover/high availability) bitcoin full nodes to power an entire mining farm. You could setup hundreds/thousands of ASIC devices to mine and use a single full node to feed block headers to all of them and occasionally submit a block.
Then there's the case of mining pools, which arguably is one of the most prevalent forms of mining in terms of individual users. The miners who use pools don't download the blockchain either, the pool does, and they again probably run only a handful of nodes for the entire pool. Those full nodes are not even publicly accessible to the larger network (to prevent DDOS) and hidden behind a stratum. Every home ETH miner you know probably uses a pool and doesn't run a full node, nor do they actually download the entire blockchain. They're taking rewards and not contributing to that P2P distribution.
In the case of Steem (one of the blockchains I know the most about), the witnesses here do download the full blockchain on their "mining" servers, but then they completely firewall it off from the world so that it'll never be discoverable by the rest of the network. The P2P distribution on the Steem blockchain doesn't happen on incentivized nodes either.
The ones who probably run the most full nodes on any blockchain network (and thus distributing on the P2P network) are likely the exchanges and service providers, since they're continually bombarding the APIs with requests to monitor transactions and submit operations at a far greater rate than any miner would.
From what I understand - those who are actually rewarded in mining make up an incredibly small portion of the people who actually download the full blockchain and then redistribute it to others across the P2P network.
From Spain Madrid, thank you for an honest un vias expert opinion, any other currency with new tech we should know about?
you are a Artist mi friend.
You got a lot of hate for your opinionated post/video :). When bitcoin passed 10 or 14k, you said one thing, market doesn't care about tech anymore, it's a ponzi, bigger fool theory.Even right now when I'm "investing", I do look what coin or project offers but I'm more inclined to see if there'll be bigger fools to buy that shit for a higher price, maybe because of some pretty website, maybe because they have a "partnership" deal with someone.
Everytime I argued against iota, it's flaws, I got downvoted to oblivion in reddit, it's the same thing with raiblocks, or ripple right now. There are laggards everywhere, honestly I don't care about the tech behind raiblocks, today it dipped and I got myself small amount xrb, I may increase that position only to dump it on binance, hoping there'll be fools who'll buy it for a higher price there.
Every coin actually has its own set of fools, even in Bitcoin. There are various kinds of crypto investors however, that's for sure!