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Cryptocurrency continues to gain more ground but I still have my reservations about it being the currency of the future. If by design, cryptocurrency has a fin

Cryptocurrency continues to gain more ground but I still have my reservations about it being the currency of the future. If by design, cryptocurrency has a finite volume of transferrable currency, do early adopters have an unfair advantage that could potentially make the currency unusable? I don’t see how it could possibly be fair when earlier mining yielded currency more quickly.

La1n 6y ago
Isn't this kinda inherent in all currencies in a way? Those born in rich families "yielded currency much more quickly".
- Nursie 6y ago
  In currencies which are not subject to maximum limits, no. Managed currencies tend to devalue over time. Rich families must invest and risk capital to keep growing their fortune, not just sit on it.
foxrider 6y ago
And in the early days the cost of 1 Bitcoin was abysmal. The idea is that the harder it gets to mine the more expensive it becomes.
z0xz0xz0x 6y ago
Not all cryptocurrencies have finite volumes by design. Ethereum, for example, currently doesn't have one. It also uses a proof-of-stake instead of proof-of-work for consensus, so even early owners of hardware don't maintain an advantage.
- Nursie 6y ago
  Has ethereum actually switched to PoS? It was still in the pipeline last I heard.
  - JacobSuperslav 6y ago
    afaik still PoW
  - icelancer 6y ago
    ETH 2.0 is operational and is PoS but the main Ethereum is not Proof of Stake just yet. 2ish years (Vitalik time = Valve time, so probably 3+ years).
shanecoin 6y ago
> cryptocurrency has a finite volume of transferrable currency This is true of Bitcoin. Others, such as Ethereum, have a known inflation schedule, which would help alleviate the issue you mentioned as being a currency of the future. Furthermore, it is looking like the "currency of the future" may (at least in the short term), look more like a cryptocurrency that is worth $1 and is 1:1 backed by a dollar in a bank account. These are known as stablecoins and are an in-demand topic right now for central banks around the world. Bitcoin has a property of having a known, fixed supply. This allows it to serve as a store of value. It can and is used for day-to-day transactions, but there may need to be more advancements to make these types of transactions viable long-term (such as the lightning network).
- wincy 6y ago
  Couldn’t a government just destroy a stable coin by seizing the currency backing it? Isn’t the point of a cryptocurrency supposed to be that it’s not controlled by any government?
  - londons_explore 6y ago
    Hasn't panned out that way for Tether... So far...
  - devoutsalsa 6y ago
    I don’t know if a government today could just seize crypto, but the USA did so with gold in the past. Imagine owning a whole bunch of gold, and then waking up one morning & finding out it’d been replaced with US Dollars. https://en.wikipedia.org/wiki/Executive_Order_6102 https://en.wikipedia.org/wiki/Executive_Order_6102
  - ripply 6y ago
    A stable coin doesn’t necessarily have to be backed by fiat, DAI is backed by crypto assets and those assets can fluctuate and sometimes need to be increased during volatility. I think the point of fiat backed stable coins are more for getting around regulations (eg Tether) and a fiat on-ramp for getting into the ecosystem. Certainly if the government seized a large portion of Tethers assets then that could affect other assets, but this actually has already happened with (a small portion, not large) Tether and nothing catastrophic happened.
doggosphere 6y ago
Fiat currencies will probably always exist. Digital crypto assets like Bitcoin or Ethereum will exist alongside them. Bitcoin can be an asset like gold, of which users keep a portion of their networth to protect from economic uncertainty. Its deflationary policy may make it less usable as a currency, but at least crypto gives people choice.
- daptaq 6y ago
  > Digital crypto assets like Bitcoin or Ethereum will exist alongside them. Bitcoin can be an asset like gold, of which users keep a portion of their networth to protect from economic uncertainty. Seems improbable, as it is far less stable than Gold. From what I see, it is almost never used as a currency, and almost always as a speculative asset. The main indicator for me is that Bitcoin is always measured in Dollars (or some other fiat currency), instead of having some value that it taken to be it's own. Have you ever heard someone say "This bike cost me 0.63 Bitcoin"?
  - chillwaves 6y ago
    And how do you measure the value of gold?
  - nr2x 6y ago
    How much gold only exists on paper? Once people realize there is more in paper than in vaults that stability may evaporate. The Germans move their physical gold out of the US for a reason
    - delaaxe 6y ago
      The issue is apparently way worse with silver
  - delaaxe 6y ago
    Gold is also almost never used as a currency. BTC's product market fit is store of value, not medium of exchange
cft 6y ago
The original holders will die, and their heirs will sell. The original holdings will diffuse to the richest as with any asset, give it 100 years
eMGm4D0zgUAVXc7 6y ago
> If by design, cryptocurrency has a finite volume of transferrable currency, do early adopters have an unfair advantage that could potentially make the currency unusable? > I don’t see how it could possibly be fair when earlier mining yielded currency more quickly. If by design, fiat currency has an infinite volume of transferrable currency, do governments have an unfair advantage that could potentially make the currency unstable? I don't see how it could possibly be fair when just printing it yielded currency more quickly than properly earning it.
- Nursie 6y ago
  That doesn't even make sense. For a start governments don't earn money. Secondly, a managed currency controlled by a central bank under the control of a democratic government is a good thing.
  - eMGm4D0zgUAVXc7 6y ago
    > For a start governments don't earn money. Build infrastructure = provide a service. Get paid taxes for usage of said infrastructure = earn money for properly providing a service. > Secondly, a managed currency controlled by a central bank under the control of a democratic government is a good thing. That is a tautology, you merely rephrased the claim without providing any argument.
    - Nursie 6y ago
      Currency supply to the economy and the amount of services a government supplies are orthoganal issues. I didn't provide a reason, but it's not a tautology. I would accept "bland assertion".
    - conanbatt 6y ago
      > Get paid taxes for usage of said infrastructure = earn money for properly providing a service. Taxes and provision of services are completely separated. Citizen did not get their money back when schools closed because of the pandemic.
pmorici 6y ago
There is no reason that limited supply need be an inherent mechanism to a crypto currency.
- itsdsmurrell 6y ago
  Yeah, I'm sure people would be happy to transact in a crypto with 1000% inflation \s
  - pmorici 6y ago
    Historically people have been willing to use currencies with inflation like the US Dollar. The point is that any government could build a out a crypto version of their currency if they so wished and have the same inflation policies they use with paper money. The crypto part doesn't imply a specific monetary policy. Crypto just means you can use it peer to peer over the Internet without an intermediary.
- brianobush 6y ago
  Not all coins have limited supply, e.g., Ethereum does not.
dalbasal 6y ago
Is it? I mean it's certainly gaining value, but are people using it to pay for stuff? In the earlier days of bitcoin there where ATMs near me, and bars that accepted bitcoin.
crocodiletears 6y ago
Not necessarily. Dogecoin has no fixed cap on the amount of Đ in existence. Rather, it expands at a rate of Đ5billion/yr, much to the chagrin of several currency pumpers. https://github.com/dogecoin/dogecoin/issues/1674 https://github.com/dogecoin/dogecoin/issues/1674
- lovetocode 6y ago
  I did not know this. Thanks for the information. So do this make a currency like Doge more attractive as a long term solution? Will BitCoin be a one hit wonder per se?
  - crocodiletears 6y ago
    Looking at Doge's price-history, it's relatively stable, and its inflationary nature prevents it from becoming an asset to invest in. The enduring popular meme also gives it some intrinsic value that other Cryptos don't have. I'd like the coin to take off as an actual currency, and of the coins I've looked at, I think it has the most potential for adoption in that respect. But I don't think it's got the ecosystem to support that right now. A metamask-style doge wallet would do wonders for this. Also, knowing little to nothing about the backend (or other crypto backends, tbh), other than that it's derived from Bitcoin - I have concerns about scalability wrt transaction settlement times, power consumption, and ease-of-entry with self-hosted wallets.
I_am_tiberius 6y ago
The initial distribution is not fair. This is a disadvantage but it doesn't matter much. It was similar with Gold. The more time passed, the better it became distributed.
piracy1 6y ago
Isn't that true of everything? If you were an early adopter of America you could get free land that today could be worth hundreds of millions.
- delaaxe 6y ago
  That's a great analogy
  - teslaberry 6y ago
    yea, and thats why land feudalism and revolutions occur. older stakeholders become too top heavy. new ones must take their place by burning lamd records and redistribution of 'gods' bounty (land). bitcoin has inertia but theres zero reason trust cent be established with an entirely new bitcoin 2.0 3.0 4.0......after all that was bcash's pitch. as scammy as it is , at least you roger ver started it not an anonymous japanese dildo. dont like it? start bitcoin 3.0 and airdrop evenly to all citozens, you know ...because ubi solves eveuthing. .
  - piracy1 6y ago
    Thanks :)
- lovetocode 6y ago
  I mean I don’t disagree with you but it still makes my stomach turn a bit.
- MisterSandman 6y ago
  That's a valid analogy but also on a much longer time frame. Bitcoin increased in value orders of magnitude quicker than the value of land in the US. If somebody who bought a house 5 years ago was selling it for 100 times today, you bet your ass people would be mad.
  - brianobush 6y ago
    Like Tesla stock? In the past year Tesla has gone parabolic, which looks very much similar to Bitcoin. How are they different?
xiphias2 6y ago
Quite the opposite. Bitcoin was the first fair currency, where everybody who had a computer could get it. There wasn't any currency created a more fair way. Even now everybody can look at it and evaluate how well its design resonates with his or her philosophy.
- quesera 6y ago
  > Bitcoin was the first fair currency, where everybody who had a computer could get it. Even if it was correct, that would be an extraordinarily bizarre definition of "fair".
  - xiphias2 6y ago
    Sure, you're right, but the other option is to be a banker...there are much more people with computers than with banking license.
  - brianobush 6y ago
    Why? You could easily mine the currency on an average computer with no special hardware. Just because you didn't notice, doesn't mean it wasn't fair.
deleted 6y ago
[deleted]

La1n 6y ago

Isn't this kinda inherent in all currencies in a way? Those born in rich families "yielded currency much more quickly".

Nursie 6y ago
In currencies which are not subject to maximum limits, no. Managed currencies tend to devalue over time. Rich families must invest and risk capital to keep growing their fortune, not just sit on it.

foxrider 6y ago

And in the early days the cost of 1 Bitcoin was abysmal. The idea is that the harder it gets to mine the more expensive it becomes.

z0xz0xz0x 6y ago

Not all cryptocurrencies have finite volumes by design. Ethereum, for example, currently doesn't have one. It also uses a proof-of-stake instead of proof-of-work for consensus, so even early owners of hardware don't maintain an advantage.

Nursie 6y ago
Has ethereum actually switched to PoS? It was still in the pipeline last I heard.
- JacobSuperslav 6y ago
  afaik still PoW
- icelancer 6y ago
  ETH 2.0 is operational and is PoS but the main Ethereum is not Proof of Stake just yet. 2ish years (Vitalik time = Valve time, so probably 3+ years).

shanecoin 6y ago

> cryptocurrency has a finite volume of transferrable currency This is true of Bitcoin. Others, such as Ethereum, have a known inflation schedule, which would help alleviate the issue you mentioned as being a currency of the future. Furthermore, it is looking like the "currency of the future" may (at least in the short term), look more like a cryptocurrency that is worth $1 and is 1:1 backed by a dollar in a bank account. These are known as stablecoins and are an in-demand topic right now for central banks around the world. Bitcoin has a property of having a known, fixed supply. This allows it to serve as a store of value. It can and is used for day-to-day transactions, but there may need to be more advancements to make these types of transactions viable long-term (such as the lightning network).

wincy 6y ago
Couldn’t a government just destroy a stable coin by seizing the currency backing it? Isn’t the point of a cryptocurrency supposed to be that it’s not controlled by any government?
- londons_explore 6y ago
  Hasn't panned out that way for Tether... So far...
- devoutsalsa 6y ago
  I don’t know if a government today could just seize crypto, but the USA did so with gold in the past. Imagine owning a whole bunch of gold, and then waking up one morning & finding out it’d been replaced with US Dollars. https://en.wikipedia.org/wiki/Executive_Order_6102 https://en.wikipedia.org/wiki/Executive_Order_6102
- ripply 6y ago
  A stable coin doesn’t necessarily have to be backed by fiat, DAI is backed by crypto assets and those assets can fluctuate and sometimes need to be increased during volatility. I think the point of fiat backed stable coins are more for getting around regulations (eg Tether) and a fiat on-ramp for getting into the ecosystem. Certainly if the government seized a large portion of Tethers assets then that could affect other assets, but this actually has already happened with (a small portion, not large) Tether and nothing catastrophic happened.

doggosphere 6y ago

Fiat currencies will probably always exist. Digital crypto assets like Bitcoin or Ethereum will exist alongside them. Bitcoin can be an asset like gold, of which users keep a portion of their networth to protect from economic uncertainty. Its deflationary policy may make it less usable as a currency, but at least crypto gives people choice.

daptaq 6y ago
> Digital crypto assets like Bitcoin or Ethereum will exist alongside them. Bitcoin can be an asset like gold, of which users keep a portion of their networth to protect from economic uncertainty. Seems improbable, as it is far less stable than Gold. From what I see, it is almost never used as a currency, and almost always as a speculative asset. The main indicator for me is that Bitcoin is always measured in Dollars (or some other fiat currency), instead of having some value that it taken to be it's own. Have you ever heard someone say "This bike cost me 0.63 Bitcoin"?
- chillwaves 6y ago
  And how do you measure the value of gold?
- nr2x 6y ago
  How much gold only exists on paper? Once people realize there is more in paper than in vaults that stability may evaporate. The Germans move their physical gold out of the US for a reason
  - delaaxe 6y ago
    The issue is apparently way worse with silver
- delaaxe 6y ago
  Gold is also almost never used as a currency. BTC's product market fit is store of value, not medium of exchange

cft 6y ago

The original holders will die, and their heirs will sell. The original holdings will diffuse to the richest as with any asset, give it 100 years

eMGm4D0zgUAVXc7 6y ago

> If by design, cryptocurrency has a finite volume of transferrable currency, do early adopters have an unfair advantage that could potentially make the currency unusable? > I don’t see how it could possibly be fair when earlier mining yielded currency more quickly. If by design, fiat currency has an infinite volume of transferrable currency, do governments have an unfair advantage that could potentially make the currency unstable? I don't see how it could possibly be fair when just printing it yielded currency more quickly than properly earning it.

Nursie 6y ago
That doesn't even make sense. For a start governments don't earn money. Secondly, a managed currency controlled by a central bank under the control of a democratic government is a good thing.
- eMGm4D0zgUAVXc7 6y ago
  > For a start governments don't earn money. Build infrastructure = provide a service. Get paid taxes for usage of said infrastructure = earn money for properly providing a service. > Secondly, a managed currency controlled by a central bank under the control of a democratic government is a good thing. That is a tautology, you merely rephrased the claim without providing any argument.
  - Nursie 6y ago
    Currency supply to the economy and the amount of services a government supplies are orthoganal issues. I didn't provide a reason, but it's not a tautology. I would accept "bland assertion".
  - conanbatt 6y ago
    > Get paid taxes for usage of said infrastructure = earn money for properly providing a service. Taxes and provision of services are completely separated. Citizen did not get their money back when schools closed because of the pandemic.

pmorici 6y ago

There is no reason that limited supply need be an inherent mechanism to a crypto currency.

itsdsmurrell 6y ago
Yeah, I'm sure people would be happy to transact in a crypto with 1000% inflation \s
- pmorici 6y ago
  Historically people have been willing to use currencies with inflation like the US Dollar. The point is that any government could build a out a crypto version of their currency if they so wished and have the same inflation policies they use with paper money. The crypto part doesn't imply a specific monetary policy. Crypto just means you can use it peer to peer over the Internet without an intermediary.
brianobush 6y ago
Not all coins have limited supply, e.g., Ethereum does not.

dalbasal 6y ago

Is it? I mean it's certainly gaining value, but are people using it to pay for stuff? In the earlier days of bitcoin there where ATMs near me, and bars that accepted bitcoin.

crocodiletears 6y ago

Not necessarily. Dogecoin has no fixed cap on the amount of Đ in existence. Rather, it expands at a rate of Đ5billion/yr, much to the chagrin of several currency pumpers. https://github.com/dogecoin/dogecoin/issues/1674 https://github.com/dogecoin/dogecoin/issues/1674

lovetocode 6y ago
I did not know this. Thanks for the information. So do this make a currency like Doge more attractive as a long term solution? Will BitCoin be a one hit wonder per se?
- crocodiletears 6y ago
  Looking at Doge's price-history, it's relatively stable, and its inflationary nature prevents it from becoming an asset to invest in. The enduring popular meme also gives it some intrinsic value that other Cryptos don't have. I'd like the coin to take off as an actual currency, and of the coins I've looked at, I think it has the most potential for adoption in that respect. But I don't think it's got the ecosystem to support that right now. A metamask-style doge wallet would do wonders for this. Also, knowing little to nothing about the backend (or other crypto backends, tbh), other than that it's derived from Bitcoin - I have concerns about scalability wrt transaction settlement times, power consumption, and ease-of-entry with self-hosted wallets.

I_am_tiberius 6y ago

The initial distribution is not fair. This is a disadvantage but it doesn't matter much. It was similar with Gold. The more time passed, the better it became distributed.

piracy1 6y ago

Isn't that true of everything? If you were an early adopter of America you could get free land that today could be worth hundreds of millions.

delaaxe 6y ago
That's a great analogy
- teslaberry 6y ago
  yea, and thats why land feudalism and revolutions occur. older stakeholders become too top heavy. new ones must take their place by burning lamd records and redistribution of 'gods' bounty (land). bitcoin has inertia but theres zero reason trust cent be established with an entirely new bitcoin 2.0 3.0 4.0......after all that was bcash's pitch. as scammy as it is , at least you roger ver started it not an anonymous japanese dildo. dont like it? start bitcoin 3.0 and airdrop evenly to all citozens, you know ...because ubi solves eveuthing. .
- piracy1 6y ago
  Thanks :)
lovetocode 6y ago
I mean I don’t disagree with you but it still makes my stomach turn a bit.
MisterSandman 6y ago
That's a valid analogy but also on a much longer time frame. Bitcoin increased in value orders of magnitude quicker than the value of land in the US. If somebody who bought a house 5 years ago was selling it for 100 times today, you bet your ass people would be mad.
- brianobush 6y ago
  Like Tesla stock? In the past year Tesla has gone parabolic, which looks very much similar to Bitcoin. How are they different?

xiphias2 6y ago

Quite the opposite. Bitcoin was the first fair currency, where everybody who had a computer could get it. There wasn't any currency created a more fair way. Even now everybody can look at it and evaluate how well its design resonates with his or her philosophy.

quesera 6y ago
> Bitcoin was the first fair currency, where everybody who had a computer could get it. Even if it was correct, that would be an extraordinarily bizarre definition of "fair".
- xiphias2 6y ago
  Sure, you're right, but the other option is to be a banker...there are much more people with computers than with banking license.
- brianobush 6y ago
  Why? You could easily mine the currency on an average computer with no special hardware. Just because you didn't notice, doesn't mean it wasn't fair.

deleted 6y ago

[deleted]