Nick Szabo

I posted this because it is an interesting view, and it was written in 1913 and so a lot the ideas here got picked up and included in ideas of economics since then.

But I do have some major disagreements with the author:

"Credit and debt have nothing and never have had anything to do with gold and silver."

The history goes that originally humans used things like shells and beads to signal debts and obligations ( http://szabo.best.vwh.net/shell.html ). The idea is you need to have some collectible that is very hard to produce or fake, otherwise someone could forge it and fake that you owed them a debt. Overtime, it turns out gold and silver make the best tokens, because they are rare, easily molded into tokens of various size, and are very hard to fake. Then the government makes coins out of these gold and silver, and tries to make the coins the official tender, and sets the value of the coins at premium over the bullion included. Finally, the government tries to debase the coins gradually so it can make money from seinorage.

"Such legislation was, no doubt, due to the erroneous view that has grown up in modern days that a depositor has the right to have his deposit paid in gold or in “lawful money.” I am not aware of any law expressly giving him such a right, and under normal conditions, at any rate, he would not have it"

It would have been news to the depositors that they did not have the right to withdraw the money they put in. If they were not given this right, would…

Sure, no problem. As you can see I didn't dig deep in other instruments, though there are a lot of interesting things (selling puts for banks, corporate bonds, buying VIX), but they require due diligence as well, you just need to dig deep and read everything that you can find about them.

This is the video series I was writing about:
http://www.youtube.com/playlist?list=PLE88E9ICdipidHkTehs1VbFzgwrq1jkUJ

Mike Maloney most important part of the film about investing in silver:
http://www.youtube.com/watch?v=vAAIwef3dOg

Why you should invest in Bitcoin (Tuur Demester, 2013):
http://www.youtube.com/watch?v=K7LQu-eIOO0

Bitcoin Whitepaper: http://bitcoin.org/bitcoin.pdf

Origins of money (by Nick Szabo):
http://szabo.best.vwh.net/shell.html
http://szabo.best.vwh.net/index.html

Also if you decide to invest into Bitcoin, the most important things are:

- Buy only what you can hold for at least 5 years (and expect the 95% downturns)

- Use a hardware wallet (I prefer https://trezor.io/ , Ledger is probably OK as well, but the source code is really ugly, and it has a trusted module that I don't trust).

- Don't buy alt coins, or if you do, make sure that you read the source code, look at the test coverage, read cryptography books to understand their cryptography, see how many bugs they have, make sure that you are really able to run a full node that synchronizes from the genesis block, if it has smart contracts, see if the smart contracts have integration tests as well, look at…

In implying the penny gap can be eliminated, this article fails to account for mental transaction costs. No matter how simple a microbilling service is, there is still a mental transaction cost for deciding whether to pay or not. If my time is worth $20/hour (US average wage), and it takes me 3 seconds to read your microbilling screen and understand what you are charging, it has already cost me a penny. 3 seconds is enough time for the average reader to read 5 words. I would estimate you have about a minute to explain your service and charge for it, if you want the customer to spend a quarter on something that is worth fifty cents (or more) to them. (See http://szabo.best.vwh.net/micropayments.html or http://en.wikipedia.org/wiki/Micropayment#Theory.2Fcriticism for more background on mental transaction costs.)

If the price of your freemium service is artificially high, then you are doing it wrong. The freemium model is for services where the price of supporting free users is less than the price of other ways of informing your paying customers that you exist. (Including cases where free users contribute value.)

The best way to structure the freemium model is such that you only charge for things that are natural scarcities, not things that can be freely replicated. For example, charging for support (human time to solve your problem) is better than charging for features. (Existing features aren't scarce, it costs nothing to roll them out to all users. Implementing new…

1. You just make an agreement with someone who would like to buy your tokens for some national currency. If you ever played an MMORPG or Diablo 2 or something, you know that "imaginary" digital items can be traded for "real" money. There are many exchanges where you can do this conveniently.

2. For one example, consider how tedious it is to open a new bank account; with cryptocurrency, you just make a new keypair. Smart contracts improve on normal contracts in that they are executed automatically and cheaply. One of the first theoreticians of smart contracts wrote:

"A canonical real-life example, which we might consider to be the primitive ancestor of smart contracts, is the humble vending machine. Within a limited amount of potential loss (the amount in the till should be less than the cost of breaching the mechanism), the machine takes in coins, and via a simple mechanism, which makes a freshman computer science problem in design with finite automata, dispense change and product according to the displayed price. The vending machine is a contract with bearer: anybody with coins can participate in an exchange with the vendor. The lockbox and other security mechanisms protect the stored coins and contents from attackers, sufficiently to allow profitable deployment of vending machines in a wide variety of areas. Smart contracts go beyond the vending machine in proposing to embed contracts in all sorts of property that is valuable and controlled by digital…

http://szabo.best.vwh.net/jointstock.html

"The modern joint-stock corporation has many sources in medieval Europe. First among these was corporate law itself. Although the era is commonly referred to as "feudalism," for the hierarchy of individually owned "fiefs" of land and control of serfs as fixtures of that land, large amounts of wealth in Europe were actually controlled by corporate entities. Chief among these were church lands, the corporate entities being dioceses, religious orders and the Roman Church itself. These entities controlled a substantial fraction of the land in Western Europe. Furthermore cities (with varying degrees of political independence), merchant guilds, craft guilds, and many charitable entities (such as hospitals) were legal "corporations," i.e. artificial and perpetual legal persons under law. Some basic issues in corporate law (for example, when are officers individually liable for acts of the corporation, and when the corporation is liable for acts of its agents) had already been solved in canon law and urban law long before the joint-stock corporation."

and more on the "Origins of the Joint-Stock Company"

I don't know about "stylometry", but textual analysis is definitely a field that is grounded in statistics and probability.

And here's an excellent textual analysis of Satoshi's writing -- really quite convincing:
https://likeinamirror.wordpress.com/2013/12/01/satoshi-nakamoto-is-probably-nick-szabo/

The verdict? Nick Szabo, a professor of computer science at GWU and trained attorney, with significant expertise in the digital economy and smart contracts. He's got a fascinating blog at: http://szabo.best.vwh.net/

To be honest, I was convinced by this particular analysis back in December, but I haven't been passing it around because I respected Satoshi's desire for anonymity. However, now that an innocent man is being hounded and harassed, I think it's about time that the creator step up and claim his creation. We also need to know what happened to the Satoshi stash for this amazing project to move forward with greater certainty.

So I would encourage the real Satoshi to step up. I'm not at all convinced that Dorian Nakamoto -- albeit a pretty fascinating man -- is actually the creator of Bitcoin.