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You're right, bitcoin is something entirely new, and we don't know the future, so we don't know what it will end up being.
Entirely new is a stretch. And haven't we reached the end? It's not broadly useful nor sustainable nor trustworthy.
I don’t own any yet but I don’t think it’s ever going away.
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The question asked on that video does not mention lightning. But his answer begins by explaining lightning. Back early on forsaw that lightning is the way forward and not larger blocks. Which is another indication to me, that he is indeed Nakamoto. It was a great insight very much in line with Nakamoto's thinking. Nakamoto who forsaw so many things early on like the need for a script instead of just transaction data…
Meanwhile, in actual 2023, Bitcoin once again has bloated mempool and high transaction fees while big block Bitcoin cash is clearing regularly. I think we have enough real history at this point to dismiss the notion that "lightning is the way forward" in an absolute, concrete and not theoretical way.
If a mempool clears, that just means there is limited demand to use the chain, even for free.
> Who, we ask, is so altruistic as to create a new monetary system but not use it to enrich themselves? Bitcoin's supply schedule, in which half of all Bitcoin is mined in the first four years, guaranteed a Bitcoin wealth concentration on the early miners, especially considering how few there were. At long intervals, Satoshi would be the only one, mining on his laptop. A truly altruistic system would not confer such…
You really need to get someone rich in order for the meme to spread. This is the only way. People have a natural tendency to not be interested in currencies. Thinking about currencies makes their head ache. It needs to be really rewarding. On the other hand, there was no precedent and it was really risky. Most people were throwing away bitcoin at the start, and they just wanted it to spread.
In Bitcoin the security depends on the price of the currency. If the price doesn't pick up, the network won't be secure enough. It has to be rewarding, it has to spread as an idea, it has to be secure. The more secure it is, the more plausible it is to succeed, and so forth.
Most people don't really understand the disinflationary model as you explained, although I agree that in theory it is better and more elegant way to distribute coins. However, I think that if Bitcoin had chosen this model, it wouldn't have taken off. This model has too high inflation for too long, and the meme and security would have died off.
If the inflation is too high for too long, the meme won't spread, and the price will stay very low or nearly zero. Then a single miner will mine all coins and no one buys them, or only a single rich dude buys them. So in the end the coins won't get distributed as widely / fairly and the project will fail.
I think that Bitcoin succeeded in it's distribution as fairly as possible. I don't think that this can be replicated. It's impossible to create a new cryptocurrency where someone won't scoop them all off cheaply in the start, and that's why the creators typically own most of the coins, which will eventually doom the project. The infinite disinflationary model might be the only way to succeed in distributing a completely new currency, because no one wants to invest in it. But it has to have some other properties in order to spread widely.
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Plus rewarding early miners creative the incentive structure more likely to drive adoption.
Just the reverse, you discourage adoption by turning a currency into an investment. If bitcoins had constant or decreasing value through time then people would be more willing to trade them. This is why deflation is so economically dangerous. It did encourage mining, but that doesn’t driving long term adoption and has nearly purely negative consequences. The ideal long term strategy for adoption would have mining to…
Yet there is no more successful digital currency on the planet. If you think you can make one with "better" rules please go ahead!
> This is why deflation is so economically dangerous.
The idea that inflation and constant spending are the only thing that makes an economy work is faith-based, and bitcoin was intentionally not started that way. So far I'd say it has worked quite well.
The thing I don't understand: if Satoshi is still alive, surely they'd have spent some of that money. They're filthy rich, so why not enjoy it? I get that you can't cash out 5% of any market in one go, without tanking prices. But you can do it gradually.
If Satoshi cashed out even a single satoshi the market would crash because now the odds of him cashing out the rest will have just risen dramatically.
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Just the reverse, you discourage adoption by turning a currency into an investment. If bitcoins had constant or decreasing value through time then people would be more willing to trade them. This is why deflation is so economically dangerous. It did encourage mining, but that doesn’t driving long term adoption and has nearly purely negative consequences. The ideal long term strategy for adoption would have mining to…
> Bitcoin failed all of those which is why it’s never had significant adoption as a currency. Yet there is no more successful digital currency on the planet. If you think you can make one with "better" rules please go ahead! > This is why deflation is so economically dangerous. The idea that inflation and constant spending are the only thing that makes an economy work is faith-based, and bitcoin was intentionally not…
Back when people used precious metals for currency many different economies would all be tied to the same shifts in value. I don’t know all the details but there’s real world support for significant deflation being detrimental not just theory.
That said trivial levels of deflation aren’t harmful, but bitcoin had very extreme deflation.
I think there is some systematic reason why people like Satoshi, Buckethead, Banksy, etc are not uncovered. In each case, I doubt that it really is hard to figure out who they are. Maybe it is the way the press and social media work. You get as many clicks for a wild theory as you get for a properly researched opinion. As for Satoshi Nakamoto: The most obvious candidate seems to be Adam Back. His invention of proof o…
> As for Satoshi Nakamoto: The most obvious candidate seems to be Adam Back. His invention of proof of work, his biography, character, writing style and role as the CEO of the company behind the main wallet software all point to him. Adam Back is obviously not Satoshi. His level of writing or thinking is not even close to the level of Satoshi. When asked what people should pay with when fees were high and Lightning N…
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Eventually with quantum computing or other advancements, someone will break the encryption and potentially swipe the part of Satoshi's coin. Bitcoin, and other crypto in general even more with higher concentration of early owners, will always be precarious because of this concentration. Whoever has control of the early issued coins, holds a leverage that is dangerous and has extortion properties. Satoshi owns 5% of b…
Eventually with quantum computing or other advancements, someone will break the encryption and potentially swipe the part of Satoshi's coin. Based on what? The search space is large enough that if you used the smallest amount of energy possible to check keys, all the energy in the known universe would still give you an astronomically small chance of success.
Are you suggesting as processing/compute increases, encryption doesn't get weaker from previous algorithms? 40-bit SSL certificates, Triple-DES encryption and MD5 + SHA-1 hashing would like a word. AES-256 could outlast the universe but that is based on our current knowledge, and sometimes encryption systems have doors, not only in the algorithm but the tooling that does the encrypting... the creators of bitcoin tools they used for keys may also be a weak link or even had doors they put in themselves as a failsafe, humans tend to do that due to game theory.
Encryption is a balance of compute/processing for encryption and decryption, too intense and the system is computationally too heavy. So with that, over time all encryption will be able to be broken at some point following, as history has show so far.
Even if that holds, the chance that someone finds the keys or tracks them down, might be faster and most likely will happen as time goes on.
The point being mainly that too much concentration in any financial system is a time bomb.
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> Bitcoin failed all of those which is why it’s never had significant adoption as a currency. Yet there is no more successful digital currency on the planet. If you think you can make one with "better" rules please go ahead! > This is why deflation is so economically dangerous. The idea that inflation and constant spending are the only thing that makes an economy work is faith-based, and bitcoin was intentionally not…
> is faith based Back when people used precious metals for currency many different economies would all be tied to the same shifts in value. I don’t know all the details but there’s real world support for significant deflation being detrimental not just theory. That said trivial levels of deflation aren’t harmful, but bitcoin had very extreme deflation.
> I don’t know all the details but there’s real world support for significant deflation being detrimental not just theory.
The problem is that the "real world support" is usually taken from fiat money economies that are entirely built on inflation, and for historical examples there usually was an economic crisis at the same time that was accompanied by deflation. It's hardly conclusive.