Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Bitcoin is largely controlled by a small group of investors and miners

techspot.com

Post reply on HN
Print view View original

31–40 of 486 posts

Re: Bitcoin is largely controlled by a small group of investors and miners

#31

Post by ajkdhcb2 »

jayd16 wrote: post #22
ajkdhcb2 wrote: post #19

Users, miners and developers all have different powers and hold each other to account in an interesting way that few people understand so far, affecting what 'control' really means. It needs to be put in context with alternatives. Compared to the alternative of corrupt governments that have complete control to print money at will, I have no doubt that it is a extremely promising experiment. ASICs do seem to pervert s…

In what way do users have control over miners or developers? If the assumption is that corruption can overcome a democratic state, I never understood why its so crazy to suggest it can overcome developers or a mining cartel.

Developers are wasting their time if nobody wants to use what they develop. Miners lose their income if they are mining blocks on a chain that nobody wants to use.

Users running software nodes validates the blocks, limiting what miners can do. Miners can be pushed to change the rules with methods like a 'User Activated Soft Fork'. The proof of work algorithm can even be changed, rendering all the ASIC hardware of the mining industry worthless.

Re: Bitcoin is largely controlled by a small group of investors and miners

#33

Post by CryptoPunk »

Importantly, distributed public blockchains like Bitcoin and Ethereum don't give large holders the power to tax other participants, engage in seigniorage (1), or censor transactions and thereby become gatekeepers/tollgaters.

(1) PoW hardware or staked coins, in PoW and PoS Sybil control mechanisms, respectively, do give their owners the power to issue new currency and collect transaction fees, but it is an open market where all capital earns the same percentage return, and thereby does not exacerbate wealth inequality.

Re: Bitcoin is largely controlled by a small group of investors and miners

#35

Post by nightski »

graeme wrote: post #24
ofou wrote: post #13

How much does it cost the sum of all BTC mining?

Easy to calculate. Assuming an efficient mining market, yearly costs are 900 * 365 * price of bitcoin. 900 is the number of new coins mined per day. At current market price, $60,000, bitcoin costs $19.7 billion USD. Or, 13x Tesla’s famous investment. You’d need a Tesla sized investment every month for a year just to balance sell pressure from miners. This is without any existing investor cashing out. And this scales…

Gold trades something like $183 BN per day. U.S. Equities something like $240 BN per day. These are very rough figures. But Bitcoin is worldwide and I don't see how you are hung up on $1B / day.

Bitcoin volume in the past 24 hours was actually $36 BN.

Re: Bitcoin is largely controlled by a small group of investors and miners

#36

Post by mechanical_bear »

arcticbull wrote: post #11
JoiDegn wrote: post #5

Earlier quoted context omitted.

Yeah I think this is not really surprising. Why would bitcoin be any different than e.g. wealth more generally.

My understanding is it expends unbelievable quantities of resources pretending otherwise.

What is “it” in this case?

Re: Bitcoin is largely controlled by a small group of investors and miners

#38

Post by iszomer »

senectus1 wrote: post #3

yup, this has been the way since the beginning. in fact most of the alt coins are the same way. and its super obvious that its being manipulated by those with the largest amounts. the market is too immature. the financial gene pool is too shallow.

I guess depending on how people define it, Bitcoin would originally be the hedge against the traditional banking and monetary policy just as Ethereum would be considered a hedge against Bitcoin. Other major blockchain platforms like the upcoming Polkadot and Cardano would be hedges against Ethereum and Bitcoin -had it not been for- (hope I'm articulating this right) the philosophical rift of their founding members seeking to improve on their network without causing hard forks which coincidentally happened, both times.

Re: Bitcoin is largely controlled by a small group of investors and miners

#39

Post by ceilingcorner »

> the top 10,000 individual Bitcoin investors control roughly one third of the cryptocurrency in circulation.

The relevant comparison here is to other currencies, not to organizations in general, and to the ability and incentive of these controllers to influence the trajectory of the currency.

Two points:

1. 10,000 people controlling 33% is dramatically less control and centralization than the Federal Reserve, which ultimately has about 10 powerful people.

2. These 10,000 people have very little ability and even less incentive to affect the price of Bitcoin. Again, unlike the Fed, which can print money at will and increase inflation.

Re: Bitcoin is largely controlled by a small group of investors and miners

#40

Post by matteotom »

nightski wrote: post #35
graeme wrote: post #24

Earlier quoted context omitted.

Easy to calculate. Assuming an efficient mining market, yearly costs are 900 * 365 * price of bitcoin. 900 is the number of new coins mined per day. At current market price, $60,000, bitcoin costs $19.7 billion USD. Or, 13x Tesla’s famous investment. You’d need a Tesla sized investment every month for a year just to balance sell pressure from miners. This is without any existing investor cashing out. And this scales…

Gold trades something like $183 BN per day. U.S. Equities something like $240 BN per day. These are very rough figures. But Bitcoin is worldwide and I don't see how you are hung up on $1B / day. Bitcoin volume in the past 24 hours was actually $36 BN.

It's not about volume, but that to support a certain price bitcoin needs $x/day net inflow. To support $1M bitcoin, the market would need ~$1B/day of new money buying into bitcoin (at least for the next few years until the next reward halving).
Post reply on HN