Well not when there’s better solutions like proof of stake or other solutions DPOS
Bitcoin is creaking, it's going to break. SAFE coin is the future. Also for BTC Price&Trading discussions
Maybe, but also have a read of this post i made highlighting some concerns with the safenetwork - Safenetwork sustainability concerns - Bandwidth has an ongoing cost however Safenetwork is a pay once, benefit forever model
Maybe not “waste” economically: the ‘proof of work’-concept. But it is waste ecologically and ecology > economy. What are you with the fact that Bitcoin is to the Moon if the Earth also is (which mean broken in Dutch) …
Maybe that is a bit exaggerated, but every small effort to reduce energy consumption helps, hence the Fridge comparison.
I have read this thread very carefully and I thought about the coin issuance and farmers motivation for a long time even before. I hope, core devs are going to stick with old plans and are not going to follow some of the dangerous proposals in this thread. The system as planned now, if the constants are chosen properly, will tend to reach stability and sustainability. Everything says the system will provide good price for the uploader and appropriate motivation for a farmer in the long term.
Another push on BTC price is 1 day ago info about CME group to start trading on futures
So than we can expect that more new money will rapidly come for BTC and later will widely support other projects and cryptocurrencies.
btw.https://www.thebalance.com/how-much-power-does-the-bitcoin-network-use-391280 is info from May 2015, now total electricity consumation of all HW is over 1GW
I agree that there will be a need for ‘stable’ crypto currencies that have flexible supply and steady price, in addition to fixed / inflexible supply cryptocurrencies such as Bitcoin, and that these will by definition not increase in value over time (though an asset that backs them up / enables these currencies may be, e.g. a better version of Bitshares or Nushares etc).
I don’t see any fundamental reason why Bitcoin should maintain its lead as a store of value in the long term if alternatives arise that are cheaper, faster, and bring new audiences that make Bitcoin’s first mover advantage irrelevant.
As for Bitcoin being hard money… it is until at some point in the future 50% of the community have a different vision to the other 50% of the community and 21m becomes 42m on 2 chains. However, I guess even in this case, the value is maintained if you keep both coins.
Try forking Gold into a new element with slightly different properties & taking half of the market with you
I hadn’t realised gold was now more expensive than Platinum these days!
I think Bitcoin will need to stay ahead technologically to maintain its lead economically, but of course I could be wrong… it’ll be fascinating to see how the whole scene plays out.
You’re right: I didn’t read it properly and it says ‘Updated October 05, 2017’ on top.
According to the more recent http://bitcoinenergyconsumption.com it is estimated to annually 24.05 TWh, so 24.05 * 1000 / (365.25 * 24) = 2.744 GW. I hope that conversion is correct
Every solution has its pros and cons
It should be less than that.
- They used power efficiency 0,223W/GH, while Antminer S9 have 0,1W/GH. So it depend what is approximately worldwide power efficiency.
- They used Total Network Hashrate 12,458 PH/s while bitcoinwisdom.com show 7,178,623,006 GH/s (-42%).
With bitcoinwisdom.com data it would be in case of 100% antminer S9 717MW and with PE 0,223 1,6GW.
Highly interesting topic, but I need to voice my disagreement with several statements here from Jabba.
Deflationary assets (hard money like gold or BTC) tend to slow down the
velocity as they increase in value over time and therefore have a high
‘hold’ incentive. A deflationary asset will always be volatile and bad for budgeting your
business or your weekly shop, the velocity of it will also always be low
as users tend not to want to part with it when they know it will keep
rising in value.
That’s a myth. The US economy on the gold standard created huge amounts of investments, prosperity and wealth. It allows people to save money without fear of losing value in order to invest it later. The only reason people hold on to bitcoin today is not because it’s deflationary in the same sense as gold is deflationary, but because people hope to get rich quickly. Gold has historically not behaved like that. Soft money is soft because it’s centrally abused money. That’s the only way it can be soft. It lets governments go into immeasurable debt and one day there will be judgment for it. It’s supremely present oriented money that punishes future generations to benefit the present generation (at least some of them).
Bitcoin is a great technology, but it cannot compete with safecoin. Safecoin has all the advantages of bitcoin PLUS actual utility apart from it’s use as money. I agree with you on that, but I don’t buy this whole velocity/deflation talk. It doesn’t make any sense.
Why are Platinum and Palladium worth less per ounce than gold even though they’re more industrially useful and rarer?
This is the old “paradox of value” the classical economists couldn’t solve. Carl Menger and the Austrians figured it out. The solution is that value is subjective and prices are made at the margin. Prices are not established based on the sum total of all commodities and their utility, i.e. not based on all the supplies of platinum and all the supplies of gold. If we were to establish prices on the sum total of all utilities of all commodities, food would be much more expensive than smart phones. Luckily, prices are formed based on subjective valuations of marginal amounts of commodities. Comparing the price of gold with the price of platinum is literally the same as comparing apples and oranges. You might as well compare the price of gold with the price of apples and oranges. It won’t provide you any insight. More on that here: https://mises.org/library/mises-marginalism
I wasn’t saying the gold standard didn’t have some big advantages. I’m a big fan of hard money, without it any economy and society is destined to morph into short-termism, debt and consumerism. My point was certainly true and self-evident in Bitcoin today though. Holders don’t spend their bitcoins (by definition) and it is too volatile for pricing so BTC prices have to be pegged to stable fiat values in the market. You can’t make a new, limited supply resource straight into ‘currency’. As I said, even at $7trillion (top end of gold’s cap) BTC would not be anywhere close to stable enough to facilitate business (some operate at scale on tiny margins, and margins matter to everyone). Velocity does improve as Bitcoin grows because the hodl incentive decreases slightly as the returns lose some of their Xs. We are nowhere near there yet though, so BTC is nowhere near ready to become anything like currency - aside form the inherent scaling issues in its design…
BTC would surely have to become the world reserve and have a value of several million dollars a coin before it could even be considered as suitable for currency?
Tbh I don’t see a problem with fiat once I am in control of my own money. If we can hold all of our money in crypto then I can just buy as much fiat as I need that day or week to use, as can everyone else. As long as they can’t eat my savings with inflation I don’t much care what ‘the state’ does as long as they leave me alone. Let’s face it, they are not going to get rid of fiat even when this version/experiment fails, they will just create a new type of fiat. The fractional reserve system and debt-based, private bank money will probably disappear in favour of central bank’s govtcoin imo. That does not worry me and does not negate the benefits of us suddenly having easy access to hard money once again. I still see our hard money bringing in another ‘golden age’, even/especially with govt-fiat-coin in tow.
I think you’ve misunderstood my point since you’ve made it again for me here . I was addressing the idea of Bitcoin being displaced as the gold standard. I was agreeing with the point you make, value is decided subjectively by people. Gold is indeed worth more than some rarer and more useful metals, just as BTC could be worth more than some more ‘useful’ cryptos. I do not think BTC will be displaced as a store of value personally because it has become the ‘gold standard’. My point was exactly that you can’t compare the prices of gold and platinum based on utility or rarity, it is like apples and oranges. Gold is worth more because there’s more demand for it, just as I believe BTC will continue to be worth more than many more useful cryptos out there.
I think it is far too early to assert that. Bitcoin is a technology and most technologies become obsolete. Maybe it will reinvent itself with lightning network, side chains, etc, but it will start to show it weaknesses if not.
Mind you, I don’t see a collapse in Bitcoin price due to obsolescence. It wouldn’t be am overnight rejection. Just, over time, faster, cheaper, more private, better distribution, etc, will whittle away at Bitcoin’s USP.
We have to remember that the vast majority of people have never used Bitcoin and probably don’t even know much about it. While people don’t tend to know what gold is worth, it is mentioned in everything from fairy tales to economics and is at a different extreme here.
I think Bitcoin has provided an excellent runway for crypto technology. It has more than served its purpose and should be forever revered for it. However, technology marches on and Bitcoin is far from perfect. Safe coin improves on it in numerous ways, for example.
I’m a holder, meaning I mostly hodl rather than trade, but I still spend quite a bit. I might expect my crypto to go up, but that doesn’t stop me from buying for example a new computer. Am I supposed to wait for 10 or 20 years to buy a new computer? That doesn’t make any sense. My crypto could also go down, there’s no guarantee it will go in any particular direction. I mean I could put all my money into crypto and just eat rice, live in a shed, use a 10 year old computer and wait for that magic moment when deflation stops, but I don’t and I don’t really see other people doing that either.
Interesting article here (Pro tip - to get around the FT paywall just Google or Bing the title ‘Cryptocurrency exchange to exclude majority of ICOs’ - doesn’t work with DDG, Startpage etc).
I wonder how (or if) it will ultimately change the balance between the more established cryptos and the rest?
Short for Global Digital Asset Exchange, GDAX currently has the world’s fourth highest bitcoin trading volumes and is regulated by the New York Department of Financial Services. It belongs to San Francisco-based Coinbase, a digital wallet company valued at $1.6bn this summer, whose investors include Andreessen Horowitz and Union Square Ventures.
Designed for institutional traders, GDAX currently supports bitcoin, litecoin and ethereum, established cryptocurrencies which have been circulating for nine, six and two years respectively.
But as a wave of new coins has hit the market, GDAX says it is under pressure to expand its listings.
“The number one feedback I’d say we get from customers is, ‘add more things, I want to trade more assets’,” Adam White, head of GDAX, told the Financial Times. “We see those customers going to other venues, and we don’t want that to happen.”
However, Mr White played down the amount of new coins GDAX will list, saying only it expects to add “more than three” next year. “It’s not going to be hundreds,” he added, clarifying: “We plan to support dozens of new assets in the coming years.”
Sorry, I didn’t mean to imply that Bitcoin would be with us as the gold standard for the next century. I don’t generally think more than 10 years into the future because its likely to be so far removed from assumptions we make today. What I mean is in the short and medium term it seems unlikely to me that BTC will be displaced for its core function. I do strongly disagree that Bitcoin is just ‘technology’ though. I don’t think that’s any more true than ‘gold is just a metal’ or McDs is just burgers. There’s been a huge amount of energy and time poured into the Bitcoin brand and it is still the only globally recognised crypto. I see Bitcoin adopting and adapting to threats to its position as ‘store-of-value’ and a global settlement layer. Really, it is already much better than gold and has all the qualities it needs for that function. I don’t think being a bit cheaper or faster will undo the brand value of bitcoin as digital gold personally, so I find it hard to imagine it being displaced for that purpose. That doesn’t mean I don’t see the possibility of SAFE will a $20 trillion cap and BTC with a $10 trillion cap one day though. I just think BTC would make very poor currency right now, but I also don’t see how anything will be able to challenge it in the near term for store-of-value properties.
It sounds like you’re thinking in absolutes instead of shades of grey - slows, not stops. A holder does not stop spending or living, they simply try to hold as much as they can for as long as they can. The argument is not that money stops when it is deflationary, it is that is slows down relative to how big the deflation is. With slow growth like gold it is not a huge deal, with BTC at this stage it certainly looks like it is to me.
For example, I have not bought anything with BTC since I bought some gold in 2016. It cost me 2btc per ounce. Now 1BTC would buy me >4oz. I still spend my fiat to buy stuff, I still have to cash in the odd bit of BTC to fund my lifestyle. However, my crypto spending is very low. The Mrs wants a campervan conversion thing. She asked me at the start of this year. I told her she could have it at the end of next year because it will likely cost us less than half as much in BTC. The money has not stopped, nor has my life or my needs, but I have slowed down my plans and spending because it eats into our future in a much bigger way to spend now, at the early stages of BTC’s exponential growth.
I am not saying this is exclusively a bad thing btw. My point is not that hard money is bad. Quite the opposite. Without the deflationary effect of hard money I could not afford to get the campervan next year. Deflationary savings increase wealth and prosperity and they are great for the economy imho. Currency is a different matter though. It is useful for us to have access to both hard and soft money. The fiat crap in my bank is worth less every day, so I hold very little in there and I spend it without worrying about it. I have an incentive to spend it and I would never consider keeping any savings in fiat. It is reliable for the fact that it will be worth a tiny bit less each day, so folks can reliably plan, budget and fix prices around it, so it’s not all bad from a user perspective.
Anyway, if you don’t spend your deflationary assets any slower than your inflationary ones then fair play, but I know I do and I can think of several other friends in similar boats who are sitting on a fair amount of crypto-wealth but they’re not spending it like they would fiat because it is going up in value and they have plans for 5x or 10x what they have now. That is both a good and a bad thing. High velocity is good for growth, deflationary assets provide access to wealth and security. I don’t think any of this is black and white. I also don’t think the state is going anywhere for now (sadly), so we’ll have fiat to provide the soft money qualities that are useful and BTC or the like for the hard money qualities we all want and need. Imo other cryptos will need to aim at different niches than currency unless they find a way to solve stability and scalability at the same time. I reckon digital fiat will probably do a better job of being currency. Fine by me as BTC is censor resistant and convenient/cheap/secure etc. That’s all any of us need to change the wealth game really. Other cryptos will change lots of other things. Some may get bigger than BTC, but I doubt any will replace BTC as a simple store of value in the next 5-10 years. I also don’t see how BTC could be used as currency in anything other than dire need - like countries who’s fiat is too volatile or for black market purchases.
But all of those things are also true! if the only advantage Bitcoin preserves is branding and tradition, I would suggest growth would become anemic.
I am not suggesting that better technology alone is sufficient to overturn Bitcoin. I am suggesting that better technology and growing support may do. If kids start pinging safe coin to one another, they will quickly forget about old fashioned Bitcoin.
To put it another way, the barriers to replace Bitcoin are not all that high. It is just convenient to use Bitcoin to move from fiat to crypto currently.
This is basically Gresham’s Law. But what happens when you earn good money and all you have or need is good money?
6 Months ago, there was lot of buzz about Ethereum. I have seen so many articles and so many ads claiming that BTC is obsolete and ETH is goanna replace BTC in few weeks. ETH hit more than 50% of BTC market cap and almost everyone was convinced ETH is new BTC. Where is ETH now? Even hardest alt gamblers prefer LTC over ETH as investment. What I want to say, BTC was very close to become no 2. And I have seen so many people throwing their precious BTC into ETH. Now BTC is exploding, people are dumping their precious MAID and other alts for BTC. Soon, it will be another way. In this crypto world everything changes every few months. Maybe in 2 months, BTC will be for $2000 and MAID for $2, who knows? When everything seems clear market usually does what almost nobody expect. Maid is old coin, all those crypto millionaires know about it. Such old project with such long history. Only new fools throwing their life savings into BTC do not know about MAID. Old whales made huge profit last months and they want more, they know where a gold mine is. Sooner or later MAID will pump even if there will be not any development at all. It is simple, few paid ads, some organized hype and dead shit can explode. Than imagine you do not pump shit but best project in crypto, that has much higher potential. So I think, right now there is a huge accumulation phase on MAID and sooner or later huge money will flow in.
That depends what kind of good money it is. If it is a store of value with great distribution that’s only deflating by a few percent a year then great, those soft money properties no longer look so attractive in that context. If that currency is still increasing by 100% or more per year then I’d say it would likely lead to great turmoil.
For something as simple as a store of value you don’t want or need any bells and whistles. You want tradition and security, you need something dependable and universally recognised. Bitcoin has all the qualities that use case demands as far as I can see.
Imo ‘better tech’ means shooting at different goal posts because BTC has all the tech qualities it needs for its #1 use case. Other alt coins may gain a bigger market cap than BTC, but I see no reason why BTC needs to go anywhere or ‘stop growing’ simply because other value exchanges are being adopted for other use-cases.
I agree that something like SafeCoin could eventually displace BTC. But from here that feels like it would take a very very long time and there’s no real reason to think one growing means the other needs to shrink. Demand for a safe store of value is all BTC needs to fulfill imo, that’s a pretty huge need and doesn’t detract from any other uses cases for value exchange tokens or imply that they can’t be bigger than BTC one day.
I guess time will tell, although we’ll be waiting another decade until we know for sure, I already think BTC has crossed the threshold needed for survival in the short and medium term and I feel quite confident that BTC will still be around in 10 years and it will be worth a lot more than it is today, but still not really used widely as ‘currency’. I could be wrong, but I’m yet to hear an argument that makes me think differently…
You could also use that fiat to buy crypto instead. Not buying crypto is kinda the same as spending it really.
If we come to a point where all we have is cryptocurrency, then that’s pretty much impossible, there won’t be enough money around and growth would have to slow down to something like the growth of the global economy.