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[EN] The Book of Satoshi by Phil Champagne (beta)
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  • The Book of Satoshi : The Collected Writings of Bitcoin Creator Satoshi Nakamoto by Phil Champagne
  • About the Cover Picture
  • Acknowledgements
  • Who This Book is Intended For
  • Foreword
  • 1. Introduction
  • 2. How and Why Bitcoin Works
  • 3. The First Post on Crypto Mailing List
  • 4. Scalability Concerns
  • 5. The 51% Attack
  • 6. About Centrally Controlled Networks Versus Peer-to-Peer Networks
  • 7. Satoshi on the Initial Inflation Rate of 35%
  • 8. About Transactions
  • 9. On the Orphan Blocks
  • 10. About Synchronization of Transactions
  • 11. Satoshi Discusses Transaction Fees
  • 12. On Confirmation and Block Time
  • 13. The Byzantine General's Problem
  • 14. On Block Time, an Automated Test, and the Libertarian Viewpoint
  • 15. More on Double Spend, Proof-of-Work and Transaction Fees
  • 16. On Elliptic Curve Cryptography, Denial of Service Attacks, and Confirmation
  • 17. More in the Transaction Pool, Networking Broadcast, and Coding Details
  • 18. First Release of Bitcoin
  • 19. On the Purpose For Which Bitcoin Could Be Used First
  • 20. "Proof-of-Work" Tokens and Spammers
  • 21. Bitcoin Announced on P2P Foundation
  • 22. On Decentralization as Key to Success
  • 23. On the Subject of Money Supply
  • 24. Release of Bitcoin Vo.1.3
  • 25. On Timestamping Documents
  • 26. Bitcointalk Forum Welcome Message
  • 27. On Bitcoin Maturation
  • 28. How Anonymous Are Bitcoins?
  • 29. A Few Questions Answered By Satoshi
  • 30. On "Natural Deflation"
  • 31. Bitcoin Version 0.2 is Here!
  • 32. Recommendation on Ways to Do a Payment for An Order
  • 33. On the Proof-of-Work Difficulty
  • 34. On the Bitcoin Limit and Profitability of Nodes
  • 35. On the Possibility of Bitcoin Address Collisions
  • 36. QR Code
  • 37. Bitcoin Icon/Logo
  • 38. GPL License Versus MIT License
  • 39. On Money Transfer Regulations
  • 40. On the Possibility of a Cryptographic Weakness
  • 41. On a Variety of Transaction Types
  • 42. First Bitcoin Faucet
  • 43. Bitcoin 0.3 Released!
  • 44. On The Segmentation or "Internet Kill Switch"
  • 45. On Cornering the Market
  • 46. On Scalability and Lightweight Clients
  • 47. On Fast Transaction Problems
  • 48. Wikipedia Article Entry on Bitcoin
  • 49. On the Possibility of Stealing Coins
  • 50. Major Flaw Discovered
  • 51. On Flood Attack Prevention
  • 52. Drainage of Bitcoin Faucet
  • 53. Transaction to IP Address Rather Than Bitcoin Address
  • 54. On Escrow and Multi-Signature Transactions
  • 55. On Bitcoin Mining as a Waste of Resources
  • 56. On an Alternate Type of Block Chain with Just Hash Records
  • 57. On the Higher Cost of Mining
  • 58. On the Development of an Alert System
  • 59. On the Definition of Money and Bitcoin
  • 60. On the Requirement of a Transaction Fee
  • 61. On Sites with CAPTCHA and Paypal Requirements
  • 62. On Short Messages in the Block Chain
  • 63. On Handling a Transaction Spam Flood Attack
  • 64. On Pool Mining Technicalities
  • 65. On WikiLeaks Using Bitcoin
  • 66. On a Distributed Domain Name Server
  • 67. On a PC World Article on Bitcoin and WikiLeaks Kicking the Hornet's Nest
  • 68. Satoshi's Last Forum Post: Release of Bitcoin 0.3-19
  • 69. Emails to Dustin Trammell
  • 70. Last Private Correspondence
  • 71. Bitcoin and Me (Hal Finney)
  • 72. Conclusion
  • Bitcoin: A Peer-to-Peer Electronic Cash System
  • Terms & Definitions
  • Index
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45. On Cornering the Market

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Last updated 1 year ago

45

On Cornering the Market

SATOSHI REPLIES to a comment about someone’s trying to buy up all of the bitcoins and references the Hunt brothers and the silver market of the late 1970s. Note that the Hunt brothers’ share of buying was actually a small percentage of the silver market. What doomed them was their trading on COMEX from a leveraged position on the future exchange. COMEX changed the rules by placing a cap on the total amount of contracts one could have, thus forcing anyone having more than the specified limit into a selling position, and so forced the Hunt brothers to liquidate. See the detailed writing on this subject by Mike Maloney at WealthCycles.com:

Re: BTC Vulnerability? (Massive Attack against BTC system. Is it really?)

Satoshi Nakamoto July 09, 2010, 03:28:46 PM

Quote from: user on July 07, 2010, 06:15:28 PM

Hi. (I’m sorry if I don’t understand any concept).What you think if anyone intruder will buy up bitcoin currency and erase all binary data. This way can destroy bitcoin systems. Is btc network protected against that attack?

What the OP described is called “cornering the market”. When someone tries to buy all the world’s supply of a scarce asset, the more they buy the higher the price goes. At some point, it gets too expensive for them to buy any more. It’s great for the people who owned it beforehand because they get to sell it to the corner at crazy high prices. As the price keeps going up and up, some people keep holding out for yet higher prices and refuse to sell.

The Hunt brothers famously bankrupted themselves trying to corner the silver market in 1979: “Brothers Nelson Bunker Hunt and Herbert Hunt attempted to corner the world silver markets in the late 1970s and early 1980s, at one stage holding the rights to more than half of the world’s deliverable silver.[1] During Hunt’s accumulation of the precious metal silver prices rose from $11 an ounce in September 1979 to nearly $50 an ounce in January 1980.[2] Silver prices ultimately collapsed to below $11 an ounce two months later,[2] much of the fall on a single day now known as Silver Thursday, due to changes made to exchange rules regarding the purchase of commodities on margin.[3]”

http://wealthcycles.com/fe atures/the-hunt-brothers-capped-the-price-of-gold-not-50-silver
http://en.wikipedia.org/wiki/Cornering_the_market