There have been various attempts. Being a hard money fan I liked the analysis that compared costs of fiat, gold and bitcoin.
The costs are well known, but people disagree what the benefits are. That’s why it’s difficult to say whether it’s sustainable or not (we’ll reach a practical conclusion, if not theoretical, few years from now).
The critics say confirmation times are long (compared to less secure alternatives), but you get less security. I absolutely don’t mind to transact in insecure coins, but I wouldn’t necessarily keep more than (say) few thousand dollars in them for weeks or months so although I agree that for many payments bitcoin isn’t viable at the moment (maybe it will be once Lighting Network and SegWit come on line, but it’s not now).
They also say transaction fees are expensive. Depends on the amount. For micro-transactions they are, but all payment systems are good for one thing and not so good for another. We don’t use Wire Transfer to pay for a $15 phone cover on Amazon.com, but you probably wouldn’t use PayPal to transfer a down payment for your overseas real estate investment.
So there are all these pro’s and con’s, but the bottom line is when one today parks value in crypto, it’s too expensive to exit to fiat and park it there. Bitcoin is the most liquid and most secure, so for that reason alone it’s a reasonable decision. Even if you never buy any good or service, it’s the best place to store value and it’s widely used as the unit of account.
Now back to the benefits: 1) It’s very hard to confiscate, 2) It’s not going to be impacted by the negative interest rate lunacy so if the lunatics from central banks keep going, it’s going to be one of obvious escape routes, 3) IIRC mining costs that need to be paid are few hundred million dollars a year; that’s not hard to collect once the number of transactions goes up (after those changes, including the max. block size increase). (Other cryptocurrencies have similar benefits, but aren’t as liquid and secure, as I mentioned earlier).
When have we heard any of those bitcoin or crypto critics in general asking about the costs of Negative Interest Rates Policy? Currently trillion$ of bonds carry negative interest. That’s money that central banks steal from those who save.
$6 trn. at 3% is $180 billion dollars in unpaid interest per year. If you add the hard to measure costs of other forms of destruction perpetrated by the fiat system, I’d say bitcoin is doing great and it’s not too expensive for the value and convenience it provides.
I am not a bitcoin-only guy, but bitcoin does look like an anchor to me. it’s great that there are other cryptocurrencies. As long as people can choose what to use, anything that works is fine by me.
Look at supply and demand (and prices!) of BTC on local bitcoins for say Sweden, and tell me with straight face that Safecoin will be more liquid and in higher demand than BTC and then I’ll reconsider.
Okay I’ll do it for you to increase signal-to-noise ratio of this post.
- Richmond Hill, Canada (a “BTC rich” city, as many as 37 offers) - https://localbitcoins.com/places/587845/richmond-hill-ca/; the lowest sell price CAD 551.35 (Buy and sell bitcoins in Canada, with cash and online - LocalBitcoins) with a note “Floating price. The final Bitcoin amount will be determined at the time of the trade finalization.”); the other two fixed prices are over CAD 560. But even the best “floating price” has a 0.36% premium.
- The current XBTCAD exchange rate per xe.com: CAD 549.99 Peev.com shows CAD 547.5 (calculated indirectly via USD), Google shows CAD 549.99, the second largest BTC exchange (https://www.taurusexchange.com/) shows CAD 549.50
Spreads:
- the largest CA BTC exchange 554-557 (CAD 3)
- Kraken Canada CAD 541.510 - 547.000 (CAD 5+)
- For comparison, on bitfinex.com: USD 414.260 - 414.360 (USD 0.1)
Liquidity:
- On Kraken CA, if you were to sell 10 BTC thre now you’d get CAD 545 for the first 4, but CAD 530 for the last 6
And that’s an active market for the largest crypto-currency in a Tier 1 country.
In almost all Tier 2 countries (in cryptocurrency terms) you can’t even get the freaking price in the local currency , let alone trade - everything is calculated by way of USD (like peev.com calculates the CAD price). Over weekend (like now) when banks are closed you can’t even guess the price because the banks aren’t open so exchange rates are “stale”.
Are you’re saying Safecoin will will become more successful on local currency markets than bitcoin sometime soon (say within 3 years)?
It’s not one topic, but hundreds of comments across 10-20 topics over the past two years, in which various individuals (at least one of whom had forgotten to mention his investment in BitShares in a post where he was promoting BitShares) shamelessly peddled total nonsense. (Another group of such experts are those who have been calling for MAID to trade on as many cyrpto-exchanges as possible because it’s somehow “better”. Now months after Bittrex started supporting MAID, the volume is pathetic and they command a 1% market share. Thankfully for SafeX there was only one taker, so there’s still good chance for a “native” SAFE exchange to take off.)