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No, not true. Nodes can literally just choose to use the version of software that provides the best money. You can’t choose to use the US monetary policy from 1

No, not true. Nodes can literally just choose to use the version of software that provides the best money. You can’t choose to use the US monetary policy from 1960, for example. This has happened multiple times with attempted hard forks of Bitcoin which have failed because once you change the monetary policy once, the promise of hard money effect disappears. So the original monetary policy remains in place and the original network continues as the reigning champion.

meribold 5y ago
I imagine the idea of a hard fork of Bitcoin may become more popular as the supply limit is approached and transaction fees go up. The current transaction fee is only a few dollars but the cost is over a hundred. Eventually the fee will have to cover the full cost and a hard fork may start to look more interesting. If this happens I can technically stay on the original protocol, but that would be rather pointless if a sufficient majority abandons it.
- javert 5y ago
  The natural scenario is that as the mining reward goes down, hash rate will dwindle until mining is profitable again. The only real problem with that is that with a small hash rate, bitcoin can be attacked more easily. If bitcoin is the monetary backbone for many nations, they will subsidize miners to maintain the balance of power. That is the actual scenario that I'm optimistically predicting. If bitcoin isn't the monetary backbone for many nations, by then, then it's probably a failure, and should probably be allowed to die. It's also very possible that transactions fees alone actually will be sufficient to support a high enough amount of hash power to secure the network.
  - meribold 5y ago
    I don't see why many nations would jump at the opportunity to make Bitcoin their monetary backbone. For example because an immutable monetary policy won't be seen as a feature.
    - nybble41 5y ago
      > For example because an immutable monetary policy won't be seen as a feature. Each nation would love to be able to manipulate the supply itself—why not, if people will let you get away with it?—but the fact that other nations can't do the same could be seen as a feature.
      - meribold 5y ago
        If that's how it's going to work, what stopped nations from making a treaty in which everyone commits to an immutable monetary policy so far? And how does Bitcoin result in whatever it was not being a showstopper anymore?
        nybble41 5y ago
        Many countries already use money internally such as the USD (outside the US) or Euro (outside the EU) for which they do not control the policy. Explicit agreements to use a common currency across nations and share control of the policy are relatively rare; no examples come to mind apart from the EU, and that hasn't always gone according to plan, as Greece can attest. But hard currency is still a fairly common basis for exchange between nation-states, and other countries' currencies are more likely to be adopted when they are governed by relatively immutable policies. Of course, if those policies change to be less immutable it can take time for the effects to manifest. The USD was relatively stable until recently, but other countries are probably reconsidering their dependence on it at this point given the increase in the supply over the past few years. If Bitcoin does eventually become a common instrument of trade at this level it will fill the same niche currently occupied by gold and other precious metals.
  - meribold 5y ago
    > It's also very possible that transactions fees alone actually will be sufficient to support a high enough amount of hash power to secure the network. I have to admit that I have no idea how much work is actually needed to secure the network. My point of view is that the current rate of energy expenditure outweighs whatever benefit Bitcoin does or could provide to society. But if this rate is a transient result of still-significant minting going on, things could definitely look different in the future. Do you know of any analyses on how much work really has to be continuously expended in order for Bitcoin to remain reasonably secure at a given market capitalization?
- rufusroflpunch 5y ago
  I wouldn’t worry about it. Bitcoin incentivizes energy development. As the world moves to a Bitcoin standard, we will unlock new types of energy that were previously unproductive. It’s likely that energy will more cheap and plentiful under a Bitcoin standard, leading to downward pressure on transaction prices as mining is more economical. Also, more transactions are likely to move off chain to Lightning Network and sidechains. Still plenty of scaling left in the Bitcoin ecosystem.
  - javert 5y ago
    I agree with this. Just want to add, bitcoin mining can happen in remote locations with available power (hydro, geothermal) which are too far from cities to be transported by power wires. There is a limit to how far you can transmit electricity through wires. So, there are tons of untapped natural energy sources.
    - iostream23 5y ago
      And precisely in places like these, such as Niagara Falls, you see coin mining displacing tangible goods production due to both needing cheap electricity and one being more profitable than the other. In this case the market is not thinking very clearly in long term priorities, nor is infinite development of hydro and geothermal possible. Actually, this is about realizing that we live on a finite planet with finite resources that a finite amount of humans can finitely exploit finite parts of before the whole thing goes catawumpus. POW and current cryptocurrency systems are thoughtlessly and needlessly wasteful and represent inelegant architecture and brute force hackery like lightnig to correct what ultimately isn’t scalable: blockchain ledgers and fast transaction speeds vs centralization and speed. Look at DNS, for example, and how slow that is, and it’s architecture amd full vs partial copies of ledgers and jeiraexhical canonical lookups etc.
      - javert 5y ago
        You're ignoring the potential good of bitcoin there. All economic activity looks like a waste if you ignore what it's good for. Niagara Falls is not what I had in mind. There is lots of untapped hydro power in extremely remote parts Canada where nobody lives, for example.

meribold 5y ago

I imagine the idea of a hard fork of Bitcoin may become more popular as the supply limit is approached and transaction fees go up. The current transaction fee is only a few dollars but the cost is over a hundred. Eventually the fee will have to cover the full cost and a hard fork may start to look more interesting. If this happens I can technically stay on the original protocol, but that would be rather pointless if a sufficient majority abandons it.

javert 5y ago
The natural scenario is that as the mining reward goes down, hash rate will dwindle until mining is profitable again. The only real problem with that is that with a small hash rate, bitcoin can be attacked more easily. If bitcoin is the monetary backbone for many nations, they will subsidize miners to maintain the balance of power. That is the actual scenario that I'm optimistically predicting. If bitcoin isn't the monetary backbone for many nations, by then, then it's probably a failure, and should probably be allowed to die. It's also very possible that transactions fees alone actually will be sufficient to support a high enough amount of hash power to secure the network.
- meribold 5y ago
  I don't see why many nations would jump at the opportunity to make Bitcoin their monetary backbone. For example because an immutable monetary policy won't be seen as a feature.
  - nybble41 5y ago
    > For example because an immutable monetary policy won't be seen as a feature. Each nation would love to be able to manipulate the supply itself—why not, if people will let you get away with it?—but the fact that other nations can't do the same could be seen as a feature.
    - meribold 5y ago
      If that's how it's going to work, what stopped nations from making a treaty in which everyone commits to an immutable monetary policy so far? And how does Bitcoin result in whatever it was not being a showstopper anymore?
      - nybble41 5y ago
        Many countries already use money internally such as the USD (outside the US) or Euro (outside the EU) for which they do not control the policy. Explicit agreements to use a common currency across nations and share control of the policy are relatively rare; no examples come to mind apart from the EU, and that hasn't always gone according to plan, as Greece can attest. But hard currency is still a fairly common basis for exchange between nation-states, and other countries' currencies are more likely to be adopted when they are governed by relatively immutable policies. Of course, if those policies change to be less immutable it can take time for the effects to manifest. The USD was relatively stable until recently, but other countries are probably reconsidering their dependence on it at this point given the increase in the supply over the past few years. If Bitcoin does eventually become a common instrument of trade at this level it will fill the same niche currently occupied by gold and other precious metals.
- meribold 5y ago
  > It's also very possible that transactions fees alone actually will be sufficient to support a high enough amount of hash power to secure the network. I have to admit that I have no idea how much work is actually needed to secure the network. My point of view is that the current rate of energy expenditure outweighs whatever benefit Bitcoin does or could provide to society. But if this rate is a transient result of still-significant minting going on, things could definitely look different in the future. Do you know of any analyses on how much work really has to be continuously expended in order for Bitcoin to remain reasonably secure at a given market capitalization?
rufusroflpunch 5y ago
I wouldn’t worry about it. Bitcoin incentivizes energy development. As the world moves to a Bitcoin standard, we will unlock new types of energy that were previously unproductive. It’s likely that energy will more cheap and plentiful under a Bitcoin standard, leading to downward pressure on transaction prices as mining is more economical. Also, more transactions are likely to move off chain to Lightning Network and sidechains. Still plenty of scaling left in the Bitcoin ecosystem.
- javert 5y ago
  I agree with this. Just want to add, bitcoin mining can happen in remote locations with available power (hydro, geothermal) which are too far from cities to be transported by power wires. There is a limit to how far you can transmit electricity through wires. So, there are tons of untapped natural energy sources.
  - iostream23 5y ago
    And precisely in places like these, such as Niagara Falls, you see coin mining displacing tangible goods production due to both needing cheap electricity and one being more profitable than the other. In this case the market is not thinking very clearly in long term priorities, nor is infinite development of hydro and geothermal possible. Actually, this is about realizing that we live on a finite planet with finite resources that a finite amount of humans can finitely exploit finite parts of before the whole thing goes catawumpus. POW and current cryptocurrency systems are thoughtlessly and needlessly wasteful and represent inelegant architecture and brute force hackery like lightnig to correct what ultimately isn’t scalable: blockchain ledgers and fast transaction speeds vs centralization and speed. Look at DNS, for example, and how slow that is, and it’s architecture amd full vs partial copies of ledgers and jeiraexhical canonical lookups etc.
    - javert 5y ago
      You're ignoring the potential good of bitcoin there. All economic activity looks like a waste if you ignore what it's good for. Niagara Falls is not what I had in mind. There is lots of untapped hydro power in extremely remote parts Canada where nobody lives, for example.