midas

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How do you explain that gold is worth so much more than bitcoin and is barely ever used in transactions?

I wrote this comprehensive guide that sums up what I’ve learned in the years since I found myself having to solve this (awesome) problem: https://medium.com/@michaelflaxman/how-to-preserve-and-grow-...

In your specific case, I’d consider investing a small chunk of the proceeds in a qualified opportunity zone fund. The tax incentives are massive, but there are a lot tradeoffs that you’re unfortunately probably not in the best place to fully work through right now :(

Wallet author here. Thanks @ryan-c for your question.

BlockCypher does get the extended public key, which is necessary for fetching transaction history, balance, and UTXOs. Child private keys never leave your system [0]. I chose against hardened derivation because it doesn't solve any problems and introduces a new one.

Let's say you assume that you have an extended private key A (with a corresponding extended public key). You then use hardened derivation on A to calculate a hardened chain at m/0'. Let's call this extended private key B. We then send all our transactions to addresses calculated by B (m/0'/0, m/0'/1, m/0'/2, etc). Now we're back in our same boat, we have transactions to dozens (or potentially thousands) of addresses created by B and so we use the extended public key of B to ping a third party service to fetch the transaction history/balance/UTXOs. If an attacker gets any child private key of B, and the extended public key of B, they can derive all child keys of B, even though hardened derivation was used. What they can't do, is derive A (or any of its children). In other words, the purpose of hardened derivation is to separate risk between different wallets, not within the same wallet. You could give B to one wallet and know that if you lose funds from A it's not B's fault.

The problem that hardened derivation introduces is that if you set it up to use hardened derivation on your receiving and change chains (as m/0' and m/1' for example), then in order to fetch transaction history/balance/UTXOs, you need to reveal the extended public key for every hardened chain. Besides destroying any benefit of hardening, this is also a UX nightmare. Want to boot your wallet in watch-only mode? With hardened derivation, you need to supply an extended public key for every chain your wallet interacts with.

Does that make sense?

You can also read more in our FAQ [1].

Thanks!

[0] https://news.ycombinator.com/item?id=11331789 [1] https://github.com/blockcypher/bcwallet#faqs

Thanks @buss for your library! It's very well written, I recommend it to people all the time.

Wallet author here, thanks @vessenes for the comment.

Yes, as with all HD wallets, an attacker with a single private key and the the extended public key can derive all child private keys. You can read more about that aspect of HD wallets in this blog post here (https://bitcoinmagazine.com/articles/deterministic-wallets-a...).

What's important to keep in mind, is that the child keys never leave your computer. In fact, they aren't even stored in the file system. Transactions are signed locally, and only the signature (which by definition doesn't reveal the private key) is broadcast. If you dump your private keys using the wallet (option 0 for advanced users only after booting the wallet), you will see a big warning to this effect. The app won't let you dump your private keys before confirming you understand the risks.

This only matters of course if you're going into the wallet internals. If you're just using the wallet, you never have to think about this attack.

Do keep in mind from a privacy perspective though that because you're revealing your extended public key to BlockCypher, BlockCypher is able to calculate all your public bitcoin addresses.

You can read more in the FAQs here: https://github.com/blockcypher/bcwallet#faqs

Feel free to ask more questions anytime!

Edits: minor grammar tweaks.

Keep in mind that bitcoin transactions are not reversible, so any refund would require the merchant's approval.

The use of a Materialized View here is clever, but it means that every time you add a new row you have to refresh the view. For an app that accepts user-generated content, this would be very frequent since you wouldn't want users to create content and then test the search and not find it.

It takes a while to fully understand how blockchain.info works, and how their wallet is very different from something like Coinbase/Circle/Xapo. Once you do, you realize that blockchain.info is an amazing example of the types of things that can be created with cryptocurrency that weren't possible before. They truly embody the spirit of Bitcoin.

Now if only they would support HD wallets so you don't have to backup your wallet after every transaction...

I've always been surprised that landlords routinely return security deposits in full. After a decade of renting in multiple cities, I've always received 100% of my deposit back, even in cases where it probably would've been fair to charge me for some minor things (holes in the wall from hanging things, some small stains, etc).

There are penalties in some cases (the letter in this post says in Georgia if you get caught there's a 3x penalty), but I've never heard of those actually enforced.

In other words, there's a lot of incentive for this to happen all the time, especially since landlords don't have much of an online reputation (like restaurants). The fact that it's rare in the US is a great sign for doing business here generally.

Yikes! Thanks for sharing.

It's a bad sign for the crypto community that the market doesn't demand better terms. You can debate price forever but nobody should argue for misaligned incentives.

I'd prefer projects like this go one step further and destroy the bitcoin invested up-front. It doesn't make sense to do ex post (now in this case), but ex ante it signals a commitment to the new coin and a genuine bet on its future value.

Full disclosure: I hold some bitcoin, so other people destroying theirs might benefit me ever so slightly :)

What happens to all the bitcoins that are being sent in now if ethereum fails? In startups, investors almost always have a liquidation preference, which means that if things go south they get their money back first (or at least what's left of it).

I haven't heard any mention of this and I'm wondering how this is structured? If the ethereum founders were able to fail spectacularly and still walk away as millionaires that'd be quite a perverse incentive structure!

I wonder if we'll see city medallion prices fall as drivers like this choose to not buy/rent medallions. Once that happens, the math might change such that it makes sense for him to keep the medallion.

Sucks to be an investor who bet who bet against technology, ouch!

This is dangerously insecure.

Let's say badsite.com stores your password in plaintext and their database is compromised (or they're malicious actors in the first place who created the site with the purpose of gathering login credentials).

Now, an attacker who sees this will try go to gmail.com and enter the password gmail.com!@#t3st1ng (with your email address), or bankofamerica.com and try bankofamerica.com!@#t3st1ng.

Would anyone have bought the bonds without this clause?

I'm not sure, but keeping in mind that these bonds were issued at a time when Argentina was considered extremely risky to lend to, I'd imagine this was more than just an oversight on the part of some lawmaker or beaurocrat. If this clause makes it harder for Argentina to reneg on their promises (as they have done repeatedly in the past) that strikes me as crucial.

It's quite telling that they structured the deal in NY and not Argentina. I don't know why a country would agree to that unless they knew it was the only way foreign investors would consider lending them money.

Going from PDF to nicely formatted word doc would be huge for lawyers and people who do a lot of contract negotiations. It's hard to do well though.

Most people aren't aware that the difference in energy efficiency between glass and aluminum recycling is enormous. Here are some choice quotes from National Geographic...

"each 10 percent of cullet in the mix reduces the energy required to make new [glass] containers by 2 to 3 percent"

At 70% cullet (the max), that's only 14-21% in energy savings for glass.

"creating an aluminum can out of recycled materials requires only 5 percent as much energy as creating a brand new can from bauxite ore"

That's 95% energy savings for aluminum. Big difference!

Source: http://greenliving.nationalgeographic.com/energy-recycle-gla...

I love that trick. I often try to type more, but since "USA", "U.S.A." and "United States" are all different it often ends up backfiring. It's eally minor in the grand-scheme of things, but it often makes me feel unlucky for guessing incorrectly!

When websites do it well I love it! They can pick the most important links for me and put them in the nav so they're always available without me having to scroll around.

If you login to Facebook, go to the search bar and type in the letter A, you will see a list of your friends whose name (first/middle/last) starts with an A, but it's sorted based on who you are most likely to be looking for. I don't know exactly how they determime this since it could be based on so many factors like messaging, profile viewing, searching, photo tagging, shared events... even pokes!

It's spooky accurate and yet Facebook goes out of their way to never mention this kind of thing: they don't want us to realize how well they know us!

One important aspect of party rounds that this post leaves out: not everyone comes to the party at the same time.

Party rounds usually happen because investor A is interested and invites B and C, who invite D & E, and the situation repeats itself over days/weeks. All along the way, the founder is able to angle for better terms (and price!) as investors realize they have less and less leverage.

By the end of the party, it looks like a waste since investors D, L and R were the best fit and could have covered the whole round themselves. But, what brought investors D-R to the table was everyone who came before them. We can't go kicking them out of the round now! So, everyone takes a group picture (Techcrunch announcement) and makes it sound like they're so cool that they've always been partying together; nobody needs to know that most of the people showed up at the end and can't really remember the founder's name that they used to get in at the door.

tl;dr: One important aspect of the party round is that founders get better terms and less stress by signing investors as they arrive at the party. To the founder, that may be worth it.

Thanks for another great blog post Sam, keep 'em coming!

I find our community desire towards home ownership to be really strange. For example, we all need to eat food everyday for the rest of our lives, but you almost never hear society bemoaning how few people own their own means to produce food! We seem perfectly happy to pay for what we use (i.e. rent) instead of investing in production (i.e. own).

If you know you're going to live somewhere for 20 years it usually makes a lot of sense to own, but I don't know why we ascribe that aspiration to all our real estate needs.

That's it!

Keep in mind that not all founders are this savvy when it comes to deal terms, and most investors will push founders to issue a larger option pool than needed. The investor will say something like "we want to be sure we have enough options available to recruit the best employees" or "we don't want to have to issue more options later because it would be a distraction". Both of these arguments have a kernel of truth in them, but they're not very good. You can always issue more options later and it's quite simple. What they're actually saying is, "I don't want you to come back and dilute me later when you could dilute yourself now instead". How thoughtful!

In a perfect world, this would have no effect on you. In the real world, it sometimes causes people to create option pools that are too big/small, since it's a confusing topic and it can be really hard to predict exactly what you need in advance! How people then act in those situations differs massively, but only affects things on the margin (e.g. perhaps the founder will issue a slightly more generous equity package to a new employee because "I have this whole option pool to spend").

tl:dr; this should have very little effect on you as an employee, but if your company's option pool came out of the pre, then the founders probably wasted valuable time and energy figuring this out with an investor who shouldn't have asked to structure it this way in the first place. Unfortunately, like many terms in financing (see the rest of Sam's post), this is too often the case. Fortunately, it will have little impact on the company or your experience, so don't worry about it :)

The no option pool part is great. Taking the option pool out of the pre money creates horrible incentives: founders are incentivized to tell investors they only need a tiny option pool and then once they've exhausted it come back to the board later to ask for a larger pool (that will now dilute everyone).

Founders and Investors should be incentivized to work together for the benefit of the company, not work against each other to the benefit of themselves.

tl:dr; Sam is right, and I hope this becomes standard practice.

Was anyone else surprised by the quality of food that the elites were/are eating? It doesn't surprise me that they had tons of expensive possessions and services, but I would've thought the perishable nature of food would make getting the ingredients for gourmet cuisine nearly impossible!

Why do you recommend easy_install (vs pip)? I have hardly any experience with easy_install so I'm always curious when projects use it.

http://stackoverflow.com/questions/3220404/why-use-pip-over-...

I love google products (and I'm not worried about my email for a second), but their explanation is really bad:

"The problem with Google Mail should be resolved. We apologize for the inconvenience and thank you for your patience and continued support. Please rest assured that system reliability is a top priority at Google, and we are making continuous improvements to make our systems better."

It sounds like something an airline might say after bumping you to another flight!

http://www.google.com/appsstatus#hl=en&v=issue&ts=13...

EDIT: Thanks @mpeg for pointing out that this is a different outage. Still yucky copy though.

I've heard rumors that lots of stolen bikes are exported on container ships leaving the US. The argument is that the shipping is basically free, since most ships are carrying large deliveries to the US and are empty on the return trip.

Does anyone know if this is fact or fiction?

I usually buy refurbished to save money, and I'm always surprised how negatively people react when they find that out. I'm under the impression manufacturers very thoroughly test refurbished products (after all, they know part of it was broken!); it makes me wonder if on average refurbished might be in even better condition than new.

I'm guessing apple just doesn't care that much about the secondary market for their products since they make all their money off selling new products. It'd be nice if they did though!