5 ms·

> As long as someone cares about fair, censorship-resistant money that is independent of the state, Bitcoin will exist. With the majority of coins hodled by ea

by tromp 4y ago

> As long as someone cares about fair, censorship-resistant money that is independent of the state, Bitcoin will exist. With the majority of coins hodled by early adopters, Bitcoin suffers from a wealth concentration much worse than fiat's. While proof-of-work allows for fair distribution, the extremely front-loaded emission of Bitcoin is not that fair to late adopters, let alone later generations. Its capped supply, while unnecessary for being hard money [1], makes it more suitable for speculation than for use as a currency. [1] https://john-tromp.medium.com/a-case-for-using-soft-total-supply-1169a188d153 https://john-tromp.medium.com/a-case-for-using-soft-total-su...

once_inc 4y ago
Bitcoin having an unfair wealth distribution isn't a problem beyond just that; early adopters were heavily subsidised for the risk they were taking. Unlike under a Fiat standard, that uneven distribution doesn't benefit them beyond having many Bitcoin; they can't use those Bitcoin to create more Bitcoin, increasing the gorge between rich and poor. Even the most hard-core hodler from the 2010 era will eventually start spending his/her coins, at which point the distribution evens out. Also; many of the coins from that era are lost because the keys are lost.
- UncleMeat 4y ago
  You can’t make dollars from dollars in any way that you cannot also do with BTC.
  - once_inc 4y ago
    Perhaps you should check out the Cantillion effect, and research fractional reserve banking. Both are clear financial systems that greatly benefit the extremely rich.
    - shkkmo 4y ago
      Is the point you are trying to make that neither of those apply to cryotocurrencies? Because that is not true as the history of hard fork and failed exchanges demonstrates.
      - danuker 4y ago
        Which hard forks have disadvantaged the poor? One that pops to mind is Ethereum's expensive staking requirement, but Bitcoin is apparently more in touch with the community. Which exchange failures have disadvantaged the poor?
  - xani_ 4y ago
    Well, the new change in ethereum fixed that "problem"
- pwinnski 4y ago
  > early adopters were heavily subsidised for the risk they were taking This is amusing. I mined eight bitcoins in the very, very early days using my standard off-the-shelf windows PC with no GPU. It was agonizingly slow, but it worked just fine. There was zero risk. It was a fun thing to do, silly even, which is why I didn't even bother backing up the disk those BTC were on, so I'm in the keys-are-lost category. But risk? Each BTC was worth pennies, where was the risk?
  - danuker 4y ago
    It could have died out, and the volatility was extreme in those times. The risk varies with how much you invest. If you invest sensibly, then the risk is low. If you buy on leverage, you end up bankrupt.
    - yebyen 4y ago
      It doesn't even have to die out in order to ruin you. As you mentioned, you can go bankrupt from insolvency. You don't even have to directly use leveraged trading to purchase the Bitcoin to get bit by this. It just has to become a too-large proportion of your assets on your balance sheet, and the space it occupies feeling comfortable enough that you can take out as many loans as you want for other things you need. "Because no way am I killing my golden goose, but I might as well enjoy life" (PSA: Pay off your loans when you can, it may occasionally look like this bull run can never end. It will always end!)
  - rewgs 4y ago
    Man, even considering the current downturn, that is a lot of money (roughly $150,000 at the time of writing).
- throw0101a 4y ago
  > Unlike under a Fiat standard, that uneven distribution doesn't benefit them beyond having many Bitcoin; they can't use those Bitcoin to create more Bitcoin, increasing the gorge between rich and poor. Yes, they can. If anyone wants to use Bitcoin in transactions, since there is a finite supply of it, they have to go to someone who already has it. That person can be willing to lend them some, but will probably will ask for interest. So the rich Bitcoiner will get their original pile back and some extra. This is similar to the gold-based economy (and monetary Gold Standard): they who have the gold make the rules. If someone doesn't want you participating in the economy, they can restrict your access to currency since they own so much of it. Having a fixed/finite amount of money in an economy is a bug, not a feature: * https://en.wikipedia.org/wiki/Great_Bullion_Famine https://en.wikipedia.org/wiki/Great_Bullion_Famine
  - OnionSquared 4y ago
    If someone doesn't want me to participate in the Bitcoin economy, he won't sell me bitcoins. But he doesn't consist the entire economy. Similar to gold, it's always possible to acquire some, if you're living in a nation that is free market friendly.
superkuh 4y ago
Compare that to the way new circulating currency is created in fiat systems and I think you'll change your mind. All fiat system create new currency through chartered banks creating loans from reserves they don't have. There are only ~4500 chartered banks in the USA. That means all new currency is given to 4500 corporations and those corporations choose how to distribute it. This is a massively corrupt and unfair system. It's signficantly worse and more centralized than the way Bitcoin distributes new currency. At least with bitcoin actual humans get actual currency. In fiat actual human persons only get debt that mathematically can never be fully paid back. Unfortunately it's still the least worst way to run a "modern economy".
- tromp 4y ago
  I don't want to compare to fiat. I think bitcoin should have had a purely linear emission. No reward halvings. No early adopter advantage. No mere crumbs for later generations. Sure; it will take a century to get inflation down to 1%, but that means speculative use is strongly discouraged. As a result, its price would be much lower as would its environmental impact. While use as a peer-to-peer currency, its stated goal, would be largely unaffected.
  - scottiebarnes 4y ago
    That's the cool thing about open source software. You can literally design your own fork, and then work to persuade people that your vision is better. You'll be called a shit coin. But over a long enough time horizon, someone will be right. > but that means speculative use is strongly discouraged Volatility is ironically a "feature". As it stands your system has no incentive for anyone to overcome the barriers of joining. You're proposing a better system from the outside, not the inside.
  - Sohcahtoa82 4y ago
    For what it's worth, Dogecoin works this way.
    - tromp 4y ago

by tromp 4y ago

once_inc 4y ago

Bitcoin having an unfair wealth distribution isn't a problem beyond just that; early adopters were heavily subsidised for the risk they were taking. Unlike under a Fiat standard, that uneven distribution doesn't benefit them beyond having many Bitcoin; they can't use those Bitcoin to create more Bitcoin, increasing the gorge between rich and poor. Even the most hard-core hodler from the 2010 era will eventually start spending his/her coins, at which point the distribution evens out. Also; many of the coins from that era are lost because the keys are lost.

UncleMeat 4y ago
You can’t make dollars from dollars in any way that you cannot also do with BTC.
- once_inc 4y ago
  Perhaps you should check out the Cantillion effect, and research fractional reserve banking. Both are clear financial systems that greatly benefit the extremely rich.
  - shkkmo 4y ago
    Is the point you are trying to make that neither of those apply to cryotocurrencies? Because that is not true as the history of hard fork and failed exchanges demonstrates.
    - danuker 4y ago
      Which hard forks have disadvantaged the poor? One that pops to mind is Ethereum's expensive staking requirement, but Bitcoin is apparently more in touch with the community. Which exchange failures have disadvantaged the poor?
- xani_ 4y ago
  Well, the new change in ethereum fixed that "problem"
pwinnski 4y ago
> early adopters were heavily subsidised for the risk they were taking This is amusing. I mined eight bitcoins in the very, very early days using my standard off-the-shelf windows PC with no GPU. It was agonizingly slow, but it worked just fine. There was zero risk. It was a fun thing to do, silly even, which is why I didn't even bother backing up the disk those BTC were on, so I'm in the keys-are-lost category. But risk? Each BTC was worth pennies, where was the risk?
- danuker 4y ago
  It could have died out, and the volatility was extreme in those times. The risk varies with how much you invest. If you invest sensibly, then the risk is low. If you buy on leverage, you end up bankrupt.
  - yebyen 4y ago
    It doesn't even have to die out in order to ruin you. As you mentioned, you can go bankrupt from insolvency. You don't even have to directly use leveraged trading to purchase the Bitcoin to get bit by this. It just has to become a too-large proportion of your assets on your balance sheet, and the space it occupies feeling comfortable enough that you can take out as many loans as you want for other things you need. "Because no way am I killing my golden goose, but I might as well enjoy life" (PSA: Pay off your loans when you can, it may occasionally look like this bull run can never end. It will always end!)
- rewgs 4y ago
  Man, even considering the current downturn, that is a lot of money (roughly $150,000 at the time of writing).
throw0101a 4y ago
> Unlike under a Fiat standard, that uneven distribution doesn't benefit them beyond having many Bitcoin; they can't use those Bitcoin to create more Bitcoin, increasing the gorge between rich and poor. Yes, they can. If anyone wants to use Bitcoin in transactions, since there is a finite supply of it, they have to go to someone who already has it. That person can be willing to lend them some, but will probably will ask for interest. So the rich Bitcoiner will get their original pile back and some extra. This is similar to the gold-based economy (and monetary Gold Standard): they who have the gold make the rules. If someone doesn't want you participating in the economy, they can restrict your access to currency since they own so much of it. Having a fixed/finite amount of money in an economy is a bug, not a feature: * https://en.wikipedia.org/wiki/Great_Bullion_Famine https://en.wikipedia.org/wiki/Great_Bullion_Famine
- OnionSquared 4y ago
  If someone doesn't want me to participate in the Bitcoin economy, he won't sell me bitcoins. But he doesn't consist the entire economy. Similar to gold, it's always possible to acquire some, if you're living in a nation that is free market friendly.

superkuh 4y ago

Compare that to the way new circulating currency is created in fiat systems and I think you'll change your mind. All fiat system create new currency through chartered banks creating loans from reserves they don't have. There are only ~4500 chartered banks in the USA. That means all new currency is given to 4500 corporations and those corporations choose how to distribute it. This is a massively corrupt and unfair system. It's signficantly worse and more centralized than the way Bitcoin distributes new currency. At least with bitcoin actual humans get actual currency. In fiat actual human persons only get debt that mathematically can never be fully paid back. Unfortunately it's still the least worst way to run a "modern economy".

tromp 4y ago
I don't want to compare to fiat. I think bitcoin should have had a purely linear emission. No reward halvings. No early adopter advantage. No mere crumbs for later generations. Sure; it will take a century to get inflation down to 1%, but that means speculative use is strongly discouraged. As a result, its price would be much lower as would its environmental impact. While use as a peer-to-peer currency, its stated goal, would be largely unaffected.
- scottiebarnes 4y ago
  That's the cool thing about open source software. You can literally design your own fork, and then work to persuade people that your vision is better. You'll be called a shit coin. But over a long enough time horizon, someone will be right. > but that means speculative use is strongly discouraged Volatility is ironically a "feature". As it stands your system has no incentive for anyone to overcome the barriers of joining. You're proposing a better system from the outside, not the inside.
- Sohcahtoa82 4y ago
  For what it's worth, Dogecoin works this way.
  - tromp 4y ago