5 ms·

I'm happy to answer any follow-up questions.

by rrecuero 9y ago

guiomie 9y ago
Was that a Jurassic Park quote you finished on with?
- rrecuero 9y ago
  Loosely but Dr. Ian Malcolm definitely came to mind :)
CJefferson 9y ago
I don't understand the long-term aim of bitcoin. It currently costs $40/transaction, that seems far beyond any reasonable idea that bitcoin could ever be useful. How is this not a ponzi scheme, help up by mining fees?
- rrecuero 9y ago
  One of the main use cases of Bitcoin is becoming a store of value. For that use case, transaction fees matter a lot less. If you want to store/move millions of dollars and protect them against inflation, those fees don't matter. Gold, also a store of value, has high transaction fees as well.
  - atarian 9y ago
    It's difficult to see mass adoption of Bitcoin from a purely store-of-value use case because most people don't (directly) own gold and probably don't think about hedging against inflation. I'd argue instead that the main use case is to buy a cup of coffee with Bitcoin anywhere in the world without having to deal with fees and red tape. So using your analogy of evolution, transaction scaling is probably going to be the biggest driver of who gets to be at the top of the crypto food chain.
    - rrecuero 9y ago
      I agree with your points. Transaction scaling is going to play a big role. I wouldn't neglect the store of value use case so quickly. Even if it only does that, it's a trillion dollar market. https://www.fool.com/investing/2017/08/17/how-does-bitcoins-market-cap-stack-up-next-to-gold.aspx https://www.fool.com/investing/2017/08/17/how-does-bitcoins-...
    - asciimo 9y ago
      Bitcoin Cash was forked to handle the cup-of-coffee use case. It looks like a diverse ecosystem is forming, where the consumer can choose to transact with the best currency for that transaction, rather than the "best currency."
    - nradov 9y ago
      Owning gold is not an effective hedge against inflation. If it was then we would see that gold returns would consistently be correlated with inflation rates, but in reality that hasn't happened. And there's no reason to expect that Bitcoin would be an effective inflation hedge either. If you want to actually hedge against inflation then TIPS or stock indexes are usually better choices for most investors.
    - CJefferson 9y ago
      I can't imagine using bitcoin as a store-of-value, it's so massively volatile. Also, I don't fancy trusting my money to a small group of Chinese miners, who seem in practice to control the network.
  - top256 9y ago
    You can do actually things with gold. More than you'd expect (for instance http://geology.com/minerals/gold/uses-of-gold.shtml http://geology.com/minerals/gold/uses-of-gold.shtml ) BTC is quite different as it is only a "value store" and is inflationary (the supply of BTC is fixed and won't increase)
    - kobeya 9y ago
      I think you mean non-inflationary?
      - top256 9y ago
        yes my bad: https://bitcoin.stackexchange.com/questions/19961/is-bitcoin-deflationary-and-inflationary-at-the-same-time https://bitcoin.stackexchange.com/questions/19961/is-bitcoin...
    - CJefferson 9y ago
      Well, except the supply of bitcoin goes is massively inflationary (miner's fees), and it is unclear the network can function without miner's fees. My personal suspision is at some point the miners will convince everyone to make a fork which keeps miner's fees forever.
- yarrel 9y ago
  "It currently costs $40/transaction" No it doesn't. "How is this not a ponzi scheme, help up by mining fees?" You misspelt "speculative bubble".
  - ivanche 9y ago
    So, how much it costs than? I'm genuinely interested because I've heard figures in the range of several cents up to $40.
    - sf_rob 9y ago
      ~$5 average right now, less for lower priority of course: https://bitinfocharts.com/comparison/bitcoin-transactionfees.html#1y https://bitinfocharts.com/comparison/bitcoin-transactionfees...
      - CJefferson 9y ago
        That $5 doesn't include the mining fees. With, it is closer to $40.
        sf_rob 9y ago
        Ah, fair enough.
        w-ll 9y ago
        https://bitcoinfees.21.co/ https://bitcoinfees.21.co/ has some better information on fees ~$3.50, and that is the mining fee. All transaction fees are given to the block that they are first included in.
- zby 9y ago
  Bitcoin might become an 'internet gold': https://medium.com/@zby/proof-of-work-8d8265def194 https://medium.com/@zby/proof-of-work-8d8265def194 Moving a kilogram of gold from one part of the world to another would already be more expensive than sending equivalent in bitcoin. But I am waiting for a new wave of POS systems: https://medium.com/@zby/proof-of-stake-can-be-cheaper-than-proof-of-work-da14223a965 https://medium.com/@zby/proof-of-stake-can-be-cheaper-than-p...

I'm happy to answer any follow-up questions.

guiomie 9y ago

Was that a Jurassic Park quote you finished on with?

rrecuero 9y ago
Loosely but Dr. Ian Malcolm definitely came to mind :)

CJefferson 9y ago

I don't understand the long-term aim of bitcoin. It currently costs $40/transaction, that seems far beyond any reasonable idea that bitcoin could ever be useful. How is this not a ponzi scheme, help up by mining fees?

rrecuero 9y ago
One of the main use cases of Bitcoin is becoming a store of value. For that use case, transaction fees matter a lot less. If you want to store/move millions of dollars and protect them against inflation, those fees don't matter. Gold, also a store of value, has high transaction fees as well.
- atarian 9y ago
  It's difficult to see mass adoption of Bitcoin from a purely store-of-value use case because most people don't (directly) own gold and probably don't think about hedging against inflation. I'd argue instead that the main use case is to buy a cup of coffee with Bitcoin anywhere in the world without having to deal with fees and red tape. So using your analogy of evolution, transaction scaling is probably going to be the biggest driver of who gets to be at the top of the crypto food chain.
  - rrecuero 9y ago
    I agree with your points. Transaction scaling is going to play a big role. I wouldn't neglect the store of value use case so quickly. Even if it only does that, it's a trillion dollar market. https://www.fool.com/investing/2017/08/17/how-does-bitcoins-market-cap-stack-up-next-to-gold.aspx https://www.fool.com/investing/2017/08/17/how-does-bitcoins-...
  - asciimo 9y ago
    Bitcoin Cash was forked to handle the cup-of-coffee use case. It looks like a diverse ecosystem is forming, where the consumer can choose to transact with the best currency for that transaction, rather than the "best currency."
  - nradov 9y ago
    Owning gold is not an effective hedge against inflation. If it was then we would see that gold returns would consistently be correlated with inflation rates, but in reality that hasn't happened. And there's no reason to expect that Bitcoin would be an effective inflation hedge either. If you want to actually hedge against inflation then TIPS or stock indexes are usually better choices for most investors.
  - CJefferson 9y ago
    I can't imagine using bitcoin as a store-of-value, it's so massively volatile. Also, I don't fancy trusting my money to a small group of Chinese miners, who seem in practice to control the network.
- top256 9y ago
  You can do actually things with gold. More than you'd expect (for instance http://geology.com/minerals/gold/uses-of-gold.shtml http://geology.com/minerals/gold/uses-of-gold.shtml ) BTC is quite different as it is only a "value store" and is inflationary (the supply of BTC is fixed and won't increase)
  - kobeya 9y ago
    I think you mean non-inflationary?
    - top256 9y ago
      yes my bad: https://bitcoin.stackexchange.com/questions/19961/is-bitcoin-deflationary-and-inflationary-at-the-same-time https://bitcoin.stackexchange.com/questions/19961/is-bitcoin...
  - CJefferson 9y ago
    Well, except the supply of bitcoin goes is massively inflationary (miner's fees), and it is unclear the network can function without miner's fees. My personal suspision is at some point the miners will convince everyone to make a fork which keeps miner's fees forever.
yarrel 9y ago
"It currently costs $40/transaction" No it doesn't. "How is this not a ponzi scheme, help up by mining fees?" You misspelt "speculative bubble".
- ivanche 9y ago
  So, how much it costs than? I'm genuinely interested because I've heard figures in the range of several cents up to $40.
  - sf_rob 9y ago
    ~$5 average right now, less for lower priority of course: https://bitinfocharts.com/comparison/bitcoin-transactionfees.html#1y https://bitinfocharts.com/comparison/bitcoin-transactionfees...
    - CJefferson 9y ago
      That $5 doesn't include the mining fees. With, it is closer to $40.
      - sf_rob 9y ago
        Ah, fair enough.
      - w-ll 9y ago
        https://bitcoinfees.21.co/ https://bitcoinfees.21.co/ has some better information on fees ~$3.50, and that is the mining fee. All transaction fees are given to the block that they are first included in.
zby 9y ago
Bitcoin might become an 'internet gold': https://medium.com/@zby/proof-of-work-8d8265def194 https://medium.com/@zby/proof-of-work-8d8265def194 Moving a kilogram of gold from one part of the world to another would already be more expensive than sending equivalent in bitcoin. But I am waiting for a new wave of POS systems: https://medium.com/@zby/proof-of-stake-can-be-cheaper-than-proof-of-work-da14223a965 https://medium.com/@zby/proof-of-stake-can-be-cheaper-than-p...