Now that 21 has revealed their plans concretely, I'm finding it hard to figure out some seemingly obvious gaping flaws in their plan. Adding mining to everything isn't efficient, not even a little bit. Mining requires a specialized data center, it can't be done with a toaster: the amount generated will be insignificantly small.
I made a stab at translating their medium post from crazy talk into something that could possibly make sense
Point 1: A new approach to micropayments
21 claims people won't use their credit cards when signing up, so they will use a BitShare chip instead.
How I think this could make sense: think Captchas, not Credit Cards. When you sign up for a site, you have to fill in an annoying captcha, it's a way of ensuring that you aren't abusing the site resources. Bitcoin's hashing concept was originally created as an alternative to this: hashcash, something to make abuse a little bit expensive. So the BitShare chip could act as a way to avoid captchas, or to go old school, to send emails with a little bit of authority that yes, I did some work to send this email and help send a signal to a spam filter it's not spam.
Point 2: Silicon as a service
21 claims that video cards and routers are going to be mining
How I think this could make sense: Imagine a future world in which the race to ASICs is over, the smaller and smaller, more efficient and more efficient war is over. Now it's all about electricity. Although this is not a business model I think is very ethical, companies start selling heavily discounted video cards and routers that make up for their discount by basically taking electricity from the customer. The thing is, people are not all that savvy about upfront payments vs payments on installment. This basically takes the payments on installment business model and moves it from the retail level to the manufacturer level
Point 3: Decentralized authentication
21 claims that you will be able to use embedded private keys to authenticate
How I think this could make sense: the best practice we have at the moment to ensure security is using multiple factor security. Instead of just something you know (your password), you use something you have (2 factor auth token) as well. Of course this is still vulnerable, more factors would be better but even 2 is a pretty frustrating experience of copying numbers etc. Imagine if you created auth tokens based on all your surrounding devices. Like to access your bank account fast checking you need to be at home on your network with your toaster, your fridge, your computer, all your devices co-signing to authenticate you. Even at the smallest level, your phone and your password automatically signing together would provide a lot more security than we currently have with just passwords and the rare user who turns on 2FA.
Point 4: Machine Twitter
21 claims that machines want to tell the world they are pooping
How this could make sense: there's a race on to figure out how to make decentralized databases. Whether it's OpenBaazar or Storj or Ethereum or Namecoin, there's obvious use cases for a key value store that's decentralized. The trouble is no one has yet figured out how to make it work and make it useful yet. BitShare chip could act as a gateway into this future database, where you have a Windows registry in the sky that's controlled by no one and authenticated via BitShare too. So your refrigerator can write to the decentralized database how many eggs you have left and you can check that from your mobile phone, and BitShare chip acts as the key that is needed to avoid people from super spamming this decentralized, standardized global database. Theoretically.
Point 5: Pay for associated services
21 claims that their chip could be used to pay for software as a service
How this could make sense: now almost all of the time the mining the chip is doing is going to be pretty worthless, but some of the time it won't. Imagine if Tesla put in BitShares into their new home battery, where when the battery gets full it can start mining, say if you have a solar panel setup. Now Tesla can offer a service to you, you can subscribe to Tesla Home PRO for free (actually paid with electricity) which has a bunch of cool new software, all you have to do is enable the Tesla BitShare chip.
Point 6: Devices create revenue splits
21 claims that the supply chain can be compensated partially
How this could make sense: this could be basically a restatement of smart contracts, where companies can work together and have a contract guiding their cooperation that needs no legal framework to ensure ongoing cooperation. For example I'm a Sauna designer and I contract out to a Chinese company to manufacture my Saunas. Now I can offer the Chinese company a split of the sales directly, and we don't have to trust each other very much. Plus I can cut the Chinese in on ongoing sales, so they now have an incentive to make a quality product that people continue to use and not just lower quality so they can lower their costs and screw me over.
Point 7: Bitcoin for the developing world
21 claims that poor people can't afford things with high upfront costs so they need the BitShare thing to offset the cost of things. This could make sense if you buy the idea that people will buy lower cost things even though there will ultimately be a higher total cost of ownership, because they are too poor for upfront costs and/or not wise buyers. Like I could sell a slightly cheaper car in India that had some embedded BitShare that was reducing the car's efficiency but sending me coins. It's kind of the idea behind the Google ChromeBooks/Android business model: Google gives away stuff for free/low-cost and then people click on ads to make up the difference.
The thing that trips me up and I'm not sure about is the underlying assumption which is that Bitcoin mining efficiency will plateau and these BitShare chips will actually be somewhat competitive vs the most advanced ASICs going forward. If ASICs blow them out of the water completely, all these points won't work because the hashing is so so difficult that mining bitcoin with these things would become indistinguishable from not mining.
Submitted May 19, 2015 at 12:01PM by pb1x http://ift.tt/1AbW8kS Bitcoin
No comments:
Post a Comment