Auroracoin – Forked and Game Over
bitcointalk.org
bitcointalk.org
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...
(not even sure if u can buy aur idk anything about it)
Is there a visual representation available?
I'm not sure it would be very profitable, but it definitely would be helpful :)
Let's wait what will happen.
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)
Can anyone comment on this interpretation ?
http://bitcoin.stackexchange.com/questions/658/what-can-an-a...
Further, just using a new algorithm only protects you briefly, right ? Can't the pools implement new algorithms as they see fit ?
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.
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 yeah, it would seem that miners of new cryptocurrencies should expect to lose money initially.
No. The most powerful thing a 51% miner can do is roll-back transactions. The currency goes back to the spender, not to the miner.
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?
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.
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.
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.
>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.
Not necessary. There simply need to be enough people supporting the currency at launch.
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.
>I'll choose BTC every time if it's offered
I hate to break this to you, but you might be a fan of Bitcoin
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.
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.
Isn't Satoshi Nakamoto's design brillian!
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.
Though I'm not disappointed: I made over 20000% on AUR.
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 :-)
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.
Good luck with A16Z. :)
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.
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.
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.
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!"
If you tried to fork bitcoin today, it'd would be freakin' OVER++.
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.
It's going to cause a big mess.
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.
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.
30 day chart:
http://coinmarketcap.com/aur_30.html
7 day chart:
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.