Why there will never be another Bitcoin • Hacker News Board

Re: Why there will never be another Bitcoin

#31

Post by tromp » Sat, Apr 20, 2024, 9:29 AM UTC

> Bitcoin’s success was about more than creating a new money; it was about creating a system to distribute value in a way that couldn’t be gamed and that didn’t unfairly advantage any user. Even Satoshi mined all the Bitcoin he received, just like everyone else.

Bitcoin hugely advantages early miners/adopters by the exponential reward reduction over time. Every successive generation gets to mine 32x less of the supply than the previous one.

A truly fair distribution would have an unchanging block reward. It would still be disinflationary [1], crucially setting it apart from fiat currency.

[1] https://john-tromp.medium.com/a-case-for-using-soft-total-su...

Re: Why there will never be another Bitcoin

#32

Post by tromp » Sat, Apr 20, 2024, 9:34 AM UTC

phire wrote: post #20

TacticalCoder wrote: post #18

Earlier quoted context omitted.

> What happens to existing hardware at that point? Resold for video games? Sold to people who have cheaper electricity? I think some is sold to people who have cheaper electricity. Some miners shall probably also mine at a loss for a while, sitting on reserves, while smaller ones dies. Cannot resell for video games: Bitcoin is mined using dedicated ASICs since many years. And Ethereum, the second biggest after Bitcoi…

> I don't understand how it'd work out: too little BTCs rewarded per block The math only works out if value of bitcoin continues to increase in value, at least a constant 25% annual return, year after year (on top of inflation). If the price of bitcoin ever stabilises (or worse, drops) over the long term, then the security of bitcoin will go down, until eventually it becomes viable for someone to launch a 51% attack.

Instead the security will rely on maintaining a large backlog of high fee paying transactions.

Re: Why there will never be another Bitcoin

#33

Post by woleium » Sun, Apr 21, 2024, 1:55 PM UTC

phire wrote: post #26

woleium wrote: post #25

Earlier quoted context omitted.

difficulty also updates every couple of weeks. less folk mining means less energy per coin mined

Yeah, the amount of energy per coin mined kind of follows the price of the coin (in the longer term, not so much in the short term). So the price going down is great news for anyone concerned about energy conservation, but because the amount of energy wasted is directly correlated to the difficulty of launching a 51% attack, the energy usage going down is bad news for anyone actually using bitcoin.

The energy is not wasted, its used to sustain the system. Similarly the energy used to power inactive pos systems is used to sustain the system for immediate use when needed.

Re: Why there will never be another Bitcoin

#34

Post by npoc » Mon, Apr 22, 2024, 9:28 AM UTC

codetrotter wrote: post #6

odyssey7 wrote: post #5

> Some predecessors, like DigiCash, were too reliant on trusted authorities and so never gained market acceptance. Aren’t bitcoin holders trusting that no authority/state actor is going to 51% attack the blockchain?

A timeless classic on this question: https://m.youtube.com/watch?v=ncPyMUfNyVM

I'd like to hear how he'd kick the bad actors off the network. Bitcoin is fundamentally permissionless.

Re: Why there will never be another Bitcoin

#35

Post by npoc » Mon, Apr 22, 2024, 9:31 AM UTC

bigcoke wrote: post #14

odyssey7 wrote: post #5

> Some predecessors, like DigiCash, were too reliant on trusted authorities and so never gained market acceptance. Aren’t bitcoin holders trusting that no authority/state actor is going to 51% attack the blockchain?

you could go further and say that bitcoin holders are trusting that no major vulnerability will be found on the network.

yes absolutely.

But it's been going strong for 15 years now, completely open for attack 24/7 and with an enormous bounty for anyone successful. And yet, tick-tock, next block.

Re: Why there will never be another Bitcoin

#36

Post by npoc » Mon, Apr 22, 2024, 9:35 AM UTC

pinkmuffinere wrote: post #4

TacticalCoder wrote: post #2

FWIW, love or hate Bitcoin, the 4th Bitcoin halving is happening in 9 blocks as I type this, give our take 90 mins, probably a bit less.

How is this relevant?

The issuance, which is the main source of bitcoin for sale on the market (from the miners) is halving.

value = demand/supply.

It takes a few months for the supply reduction to filter through to the market, but then things get wild.

Any other physical commodity such as gold for example, will naturally see a supply increase as the value increases (retired miners dusting off their picks to profit on the high prices) but bitcoin's issuance is hard fixed. No amount of effort will produce more bitcoin than 3.125 every 10 minutes. Mankind has never seen anything like this before.

Re: Why there will never be another Bitcoin

#37

Post by npoc » Mon, Apr 22, 2024, 9:41 AM UTC

tromp wrote: post #31

> Bitcoin’s success was about more than creating a new money; it was about creating a system to distribute value in a way that couldn’t be gamed and that didn’t unfairly advantage any user. Even Satoshi mined all the Bitcoin he received, just like everyone else. Bitcoin hugely advantages early miners/adopters by the exponential reward reduction over time. Every successive generation gets to mine 32x less of the suppl…

Why shouldn't it advantage early adopters? Back when bitcoin was $100, $1000, even $10000, it was far, far riskier than it is now. Those people buying it then were coming onto boards like this, only to be ridiculed and dismissed as scammers. There was no Blackrock ETF, there was no Michael Saylor. There was Mt Gox, the block wars etc.

You buy bitcoin at the price you deserve.

Re: Why there will never be another Bitcoin

#38

Post by npoc » Mon, Apr 22, 2024, 9:42 AM UTC

dpiers wrote: post #30

r2_pilot wrote: post #17

Earlier quoted context omitted.

>Bitcoin maxis aren't technologists; they're grifters trying to convince you their magic beans are the most special magic beans. Replace "bitcoin maxis" with any cryptocoin promoter and the statement remains true and equally as useless to those who refuse to consider digital coinage money.

I don’t disagree. Crypto is neat but has no useful (legal) real world applications.

Learn about money supply inflation and its enormous dilutive effects on the value of each currency unit.

https://fred.stlouisfed.org/series/M2SL

Re: Why there will never be another Bitcoin

#39

Post by npoc » Mon, Apr 22, 2024, 9:47 AM UTC

friend_and_foe wrote: post #24

dpiers wrote: post #12

Oh, please. Bitcoin is a protocol with no more inherent value than SMTP. Aside from being the Catholic cryptocurrency, it has been surpassed technologically in every way by newer and better designed protocols. Why would anyone who doesn't already own Bitcoin choose to use it for anything over, ex. Ethereum? Bitcoin maxis aren't technologists; they're grifters trying to convince you their magic beans are the most spec…

There are reasons why you'd choose bitcoin over your example, ethereum. For one, supply of ethereum is not deterministically predictable. As money, that makes it less compelling. Some other technical details are very short block time means network splits, orphaned blocks, reorgs are very common. In the short term, ethereum finality is not as reliable. Generally I agree with your point though. Money over IP can takean…

Bitcoin isn't the first form.

Study bitcoin long enough and you'll realise it is the best it could possibly be (allowing for small tweaks, additions that don't change the underlying fundamentals) It's not what it first appears and catches everyone out to start with.

Give me any number of negatives and I'll explain with clear reasoning why you're wrong and why they're a strength.

Re: Why there will never be another Bitcoin

#40

Post by npoc » Mon, Apr 22, 2024, 9:57 AM UTC

phire wrote: post #20

TacticalCoder wrote: post #18

Earlier quoted context omitted.

> What happens to existing hardware at that point? Resold for video games? Sold to people who have cheaper electricity? I think some is sold to people who have cheaper electricity. Some miners shall probably also mine at a loss for a while, sitting on reserves, while smaller ones dies. Cannot resell for video games: Bitcoin is mined using dedicated ASICs since many years. And Ethereum, the second biggest after Bitcoi…

> I don't understand how it'd work out: too little BTCs rewarded per block The math only works out if value of bitcoin continues to increase in value, at least a constant 25% annual return, year after year (on top of inflation). If the price of bitcoin ever stabilises (or worse, drops) over the long term, then the security of bitcoin will go down, until eventually it becomes viable for someone to launch a 51% attack.

You're forgetting the transaction fees. Not only is the number of bitcoin hard capped, but also the transaction rate.

As the network stores more and more value, the demand for transactions increases against a fixed supply, driving fees higher.

The fees are independent of transaction amount, so what looks like high fees to someone transferring $1000 - let's say $50 fee - will be extremely cheap for someone transferring $1,000,000,000 (when you consider it includes final settlement, and loss-less storage of value for eternity).

By 2140 all of the miners income will come from transaction fees, by which time the base layer will likely be transferring millions and billions of dollars worth of value in each transaction.