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On the Instability of Bitcoin Without the Block Reward [pdf]

cs.princeton.edu

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Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#171

Post by moralsupply »

dragonwriter wrote: post #169
moralsupply wrote: post #143

Earlier quoted context omitted.

cryptocurrency mining is mostly done using ASICs

> cryptocurrency mining is mostly done using ASICs Bitcoin mining is mostly only effective with ASICs, but cryptocurrency is more than just Bitcoin.

Cryptocurrency mining is mostly about Bitcoin.

Bitcoin has maintained at least 60% market dominance year-over-year since its inception (averaging 75% all time dominance). Ethereum (which can be profitably mined using GPUs) has currently 15% dominance, with most of the other top 15 coins not being PoW (except for Litecoin, Bitcoin Cash and Dogecoin, from which only Bitcoin Cash can be mined either with ASICs or GPUs). Also, Ethereum is in the process of moving to PoS.

Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#172

Post by trophycase »

jariel wrote: post #140
uncletammy wrote: post #137

Earlier quoted context omitted.

> It can't be a functional currency, at least as it's designed. Citation needed > And the notion that it consumes gigantic amounts of energy for no net value gained should have everyone up in arms. For what it's worth, bitcoin aims to deprecate every single brick-and-morter bank as well as all the armored trucks driving paper currency to and from them. When you start to add up all of the energy that would be saved if…

"Citation needed" I literally just explained it to you. The price of BTC has always been highly unstable. There is absolutely no evidence it will ever be stable, to the contrary in fact, all evidence points to the fact that it will remain unstable. Every single commodity or currency extant to an economy is unstable relative to the currency of that economy. The only thing 'stable' in terms of USD are things closely ti…

"Financial Services are an entire industry. Lending, transactions, authorizations, contracts, accounting, risk management, asset allocation, it's a gigantic industry."

Right, this is all on ethereum

Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#174

Post by imtringued »

uncletammy wrote: post #137
jariel wrote: post #132

Earlier quoted context omitted.

" bitcoin for every day purchases and the hope is that by 2140 the price is relatively stable." This is fantastically impossible. It will about as stable as any other commodity plus the additional swings due to public stampedes one way or another, and the fact that there is no 'underlying value' to anchor the price (like Oil). Feasibly, if exchange rates are razor thin (unlikely) then it might be possible buy milk an…

> It can't be a functional currency, at least as it's designed. Citation needed > And the notion that it consumes gigantic amounts of energy for no net value gained should have everyone up in arms. For what it's worth, bitcoin aims to deprecate every single brick-and-morter bank as well as all the armored trucks driving paper currency to and from them. When you start to add up all of the energy that would be saved if…

>For what it's worth, bitcoin aims to deprecate every single brick-and-morter bank as well as all the armored trucks driving paper currency to and from them.

Is this supposed to be some joke? No it doesn't. Someone had to create a fork of Bitcoin called Bitcoin Cash just to increase the block size. You've had your chance and you blew it.

What's going to happen from now on is that Bitcoin will be absorbed by Visa, Mastercard and Paypal who build an actual payment layer on top of Bitcoin and then people will use Visa, Mastercard and Paypal as their bank. It's the Bitcoin you know and love that is going to die.

Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#175

Post by imtringued »

trophycase wrote: post #172
jariel wrote: post #140

Earlier quoted context omitted.

"Citation needed" I literally just explained it to you. The price of BTC has always been highly unstable. There is absolutely no evidence it will ever be stable, to the contrary in fact, all evidence points to the fact that it will remain unstable. Every single commodity or currency extant to an economy is unstable relative to the currency of that economy. The only thing 'stable' in terms of USD are things closely ti…

"Financial Services are an entire industry. Lending, transactions, authorizations, contracts, accounting, risk management, asset allocation, it's a gigantic industry." Right, this is all on ethereum

I dont know much about Ethereum but the mere existence of it threatens Bitcoin's "world domination" aspirations and who knows, maybe something will come out that will threaten Ethereum.

Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#176

Post by dragonwriter »

moralsupply wrote: post #171
dragonwriter wrote: post #169

Earlier quoted context omitted.

> cryptocurrency mining is mostly done using ASICs Bitcoin mining is mostly only effective with ASICs, but cryptocurrency is more than just Bitcoin.

Cryptocurrency mining is mostly about Bitcoin. Bitcoin has maintained at least 60% market dominance year-over-year since its inception (averaging 75% all time dominance). Ethereum (which can be profitably mined using GPUs) has currently 15% dominance, with most of the other top 15 coins not being PoW (except for Litecoin, Bitcoin Cash and Dogecoin, from which only Bitcoin Cash can be mined either with ASICs or GPUs).…

> Cryptocurrency mining is mostly about Bitcoin.

What cryptocurrency mining is mostly about is entirely irrelevant to either the claim that GPUs, and the power thet consume, are used exclusively for gaming or the counterclaim that, on the contrary, significant sources of GPU use outside of gaming exist, including cryptocurrency mining. It doesn't matter if the coins for which GPU mining is viable are a much smaller share, by whatever measure you care to use, of the cryptocurrency space than Bitcoin, what matters is whether or not mining them (among other non-gaming uses) is significant in the demand for and use of GPUs.

Which it is, which is why Nvidia has recently taken steps to actively cripple mining on some gaming cards so that thet can actually reach the gaming market.

(GPGPU is also a thing, and non-gaming display acceleration; the idea that GPUs are only used for gaming is ridiculous even beyond the cryptocurrency applications.)

Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#177

Post by imtringued »

herodoturtle wrote: post #139
phroobster wrote: post #110

Earlier quoted context omitted.

>do you think the distribution of bitcoin will be somewhat equitable as we approach 2140 I don’t see why the distribution of anything would be “equitable”, outside of a communist utopia/dystopia. These days that word is mostly used by people exploiting the empathy of others to gain power for themselves.

I see what you're saying. Forgive my choice of wording. Perhaps "equitable" wasn't the correct choice. I more meant whether it will become a currency of the people. Or a store of wealth for the average person. I'm looking at this through an African lens. Bitcoin showed a lot of promise for cheap and reliable remittance payments and one day a fully fledged currency for the masses. Gave us Africans lots of hope in many…

It's ironic. Bitcoin can only keep going up if it becomes more accessible and more people use it. Yet people resist making it more accessible. It's like they are betting on a failing technology stack that will blow up after x amount of users.

Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#178

Post by delaaxe »

mumblemumble wrote: post #131
michaelscott wrote: post #86

Earlier quoted context omitted.

A much bigger assumption is that this will even be necessary, considering the last BTC mined will be in 2140. With such a long time horizon any prediction is basically fanciful guesswork; at that time miners might have all moved to renewables after they become cheap enough, we may have new forms of energy generation which make supply both super easy and cost negligible, or Earth may have entered a post-apocalyptic st…

The last BTC mined will be 2140, but the decay is exponential. The reward will halve in about 3 years, and it is likely to halve again 4 years after that, and so on.

But price appreciation is also exponential

Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#179

Post by imtringued »

uncletammy wrote: post #133
tromp wrote: post #40

Earlier quoted context omitted.

The point remains that eliminating the backlog of high fee paying transactions would jeopardize mining stability and security in the long term.

I think this is depends on how large the network has scaled at the time the block reward dies. If BTC is doing 100x visa levels, each transaction fee can have a tiny fee and mining would still be viable. That being said, I don't BTC has any intention of scaling to that degree (or at all really). The BTC devs seem much more concerned with building second layer products like lightning network. All these products actual…

The problem is that lightning is basically federated Paypal. You have to trust your specific provider to some degree. If he stiffs you, you can get arbitration on-chain. There are almost zero barriers to entry so Paypal can be replaced by Paypal 2.0.

I don't believe for one second that when you increase the size of the audience that anyone will care which provider they use. In practice that means they will just use Visa, Mastercard and Paypal, maybe even by skipping lightning entirely.

Re: On the Instability of Bitcoin Without the Block Reward [pdf]

#180

Post by imtringued »

sjy wrote: post #104
drdeca wrote: post #58

Earlier quoted context omitted.

I don’t think individual transactions are meaningfully tied to an energy cost.

Why can’t you estimate the power consumption of the whole network and divide it by the number of transactions per second?

Because that would imply linear scaling. There is a fixed energy cost that doesn't depend on the number of transactions. It goes up and down all the time.
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