6 ms·

Why there will never be another Bitcoin

31 points by codetrotter 3y ago

TacticalCoder 3y ago
FWIW, love or hate Bitcoin, the 4th Bitcoin halving is happening in 9 blocks as I type this, give our take 90 mins, probably a bit less.
- m3kw9 3y ago
  Is being used as pump fuel
- pinkmuffinere 3y ago
  How is this relevant?
  - TacticalCoder 3y ago
    I think it's no coincidence that Kraken (a very old cryptocurrencies exchange) is publishing a post on its blog about Bitcoin the very day a Bitcoin halving is happening... Thought it was worth mentioning.
  - npoc 3y ago
    The issuance, which is the main source of bitcoin for sale on the market (from the miners) is halving. value = demand/supply. It takes a few months for the supply reduction to filter through to the market, but then things get wild. Any other physical commodity such as gold for example, will naturally see a supply increase as the value increases (retired miners dusting off their picks to profit on the high prices) but bitcoin's issuance is hard fixed. No amount of effort will produce more bitcoin than 3.125 every 10 minutes. Mankind has never seen anything like this before.
- gowld 3y ago
  6 blocks ~60 minutes left. https://www.nicehash.com/countdown/btc-halving-2024-05-10-12-00 https://www.nicehash.com/countdown/btc-halving-2024-05-10-12... What happens to existing hardware at that point? Resold for video games? Sold to people who have cheaper electricity?
  - TacticalCoder 3y ago
    > What happens to existing hardware at that point? Resold for video games? Sold to people who have cheaper electricity? I think some is sold to people who have cheaper electricity. Some miners shall probably also mine at a loss for a while, sitting on reserves, while smaller ones dies. Cannot resell for video games: Bitcoin is mined using dedicated ASICs since many years. And Ethereum, the second biggest after Bitcoin, is now mined using proof-of-stake (so neither GPUs nor ASICs involved). But in a few halvings (every four years, so in a "few halvings" I won't be here anymore) I don't understand how it'd work out: too little BTCs rewarded per block and I don't see tx fees paying the miners.
    - phire 3y ago
      > I don't understand how it'd work out: too little BTCs rewarded per block The math only works out if value of bitcoin continues to increase in value, at least a constant 25% annual return, year after year (on top of inflation). If the price of bitcoin ever stabilises (or worse, drops) over the long term, then the security of bitcoin will go down, until eventually it becomes viable for someone to launch a 51% attack.
      - tromp 3y ago
        Instead the security will rely on maintaining a large backlog of high fee paying transactions.
      - greyface- 3y ago
        100% return over 4 years refigured as constant annual return is 19%, not 25%, due to compounding.
      - woleium 3y ago
        difficulty also updates every couple of weeks. less folk mining means less energy per coin mined
        phire 3y ago
odyssey7 3y ago
> Some predecessors, like DigiCash, were too reliant on trusted authorities and so never gained market acceptance. Aren’t bitcoin holders trusting that no authority/state actor is going to 51% attack the blockchain?
- codetrotter 3y ago
  A timeless classic on this question: https://m.youtube.com/watch?v=ncPyMUfNyVM https://m.youtube.com/watch?v=ncPyMUfNyVM
  - npoc 3y ago
    I'd like to hear how he'd kick the bad actors off the network. Bitcoin is fundamentally permissionless.
- drdeca 3y ago
  I suppose, but, not on the basis of "they are granted the authority to do this thing, but will not abuse it", so much as, "it is costly for them to do this thing, and it is unlikely to be worth it to them" ?
- _heimdall 3y ago
  More specifically, bitcoin holders are trusting that some collection of entities with more than 50% share of the mining power won't collude. It seems like a reasonable assumption honestly, everyone would know and value would tank. I'm by no means a fan of bitcoin, but miner collusion was never what kept me away. I like the original arguments for bitcoin related to a decentralized currency and privacy. Neither have proven to be possible on the bitcoin blockchain and I see absolutely no value in btc if I have to use off chain solutions to make it fit any real world use case.
  - odyssey7 3y ago
    If a party could control the irregular tide of Bitcoin’s value rising and crashing, then it holds a means to stimulate or impoverish whatever economies rely on Bitcoin. This could be particularly attractive for parties who want to avoid formally declaring sanctions or for situations where sanctions might not be effective. I would see a 51% attack as a nuclear option, since it could take a while for cryptocurrency users to once again believe that the network is secure, but you could imagine a situation where there is geopolitical conflict with a country, the people in that country adopt a cryptocurrency due to fiat currency collapse, and then it becomes useful to induce a cryptocurrency collapse as well. Edit: oops, might have added this comment in the wrong place.
RonToaster 3y ago
The overall premise is true but this is a very poor-quality article that has a few extremely obvious giveaways that it was AI-written.
dpiers 3y ago
Oh, please. Bitcoin is a protocol with no more inherent value than SMTP. Aside from being the Catholic cryptocurrency, it has been surpassed technologically in every way by newer and better designed protocols. Why would anyone who doesn't already own Bitcoin choose to use it for anything over, ex. Ethereum? Bitcoin maxis aren't technologists; they're grifters trying to convince you their magic beans are the most special magic beans.
- r2_pilot 3y ago
  >Bitcoin maxis aren't technologists; they're grifters trying to convince you their magic beans are the most special magic beans. Replace "bitcoin maxis" with any cryptocoin promoter and the statement remains true and equally as useless to those who refuse to consider digital coinage money.
  - dpiers 3y ago
    I don’t disagree. Crypto is neat but has no useful (legal) real world applications.
    - npoc 3y ago
      Learn about money supply inflation and its enormous dilutive effects on the value of each currency unit. https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL
      - r2_pilot 2y ago
        Lol as if BTC or any cryptocoin is a store of value(instead of speculative tulips). One of the reasons why I refuse to accept crypto as money.
        npoc 2y ago
        Regardless, take my advice
friend_and_foe 3y ago
> ...and this makes it incredibly unlikely Bitcoin will ever be outcompeted by a government or private market alternative. The premise of the article. I don't believe this for a second. Imagine the delusional hopefulness one would have to have to believe that something will, for eternity, not be superseded. Nothing in the history of humanity, or even life, remains unsurpassed from it's inception. Yet somehow this thing is unbeatable. There are cryptocurrencies out there that meet all of the criteria that is laid forth in the article as the reason for this conclusion. True, most, I'd say almost all, don't, as the article does point out, but some do. So what's the secret sauce that makes those currencies incapable if it isn't simply these criteria laid out? Is it magic? Is it some emergent property we have yet to comprehend? If so, why not say it in the article? No, the article says those traits are all you need to draw that conclusion and yet, there's no compelling reason why that's the case. It's hand waving. The criteria not mentioned is network effects. But we know, network effects are not an insurmountable obstacle. So the conclusion still does not follow. Those criteria are a must, and network effects make it incredibly difficult to supersede bitcoin, but not impossible. I say the opposite: bitcoin's demise is inevitable. Not because I don't like bitcoin, don't believe in it, think it's a scam. I am a bitcoiner. But because nothing lasts forever, bitcoin isn't perfect, and there are people out there trying to make it better that aren't getting their PRs merged and/or making it to consensus to become a part of the network software. I can think of at least one cryptocurrency that is better than bitcoin in every way, that meets all the criteria in the article, but just doesn't have the network effects. And to surmount that, the technical superiority, the benefit to the user to switch has to be so compelling that network effect diminishes. It's not enough to be marginally better, it has to be astronomically better. Maybe that one I have in mind doesn't have that, but you can bet that one will be made that will have that eventually.
tromp 3y ago
> Bitcoin’s success was about more than creating a new money; it was about creating a system to distribute value in a way that couldn’t be gamed and that didn’t unfairly advantage any user. Even Satoshi mined all the Bitcoin he received, just like everyone else. Bitcoin hugely advantages early miners/adopters by the exponential reward reduction over time. Every successive generation gets to mine 32x less of the supply than the previous one. A truly fair distribution would have an unchanging block reward. It would still be disinflationary [1], crucially setting it apart from fiat 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...
- npoc 3y ago
  Why shouldn't it advantage early adopters? Back when bitcoin was $100, $1000, even $10000, it was far, far riskier than it is now. Those people buying it then were coming onto boards like this, only to be ridiculed and dismissed as scammers. There was no Blackrock ETF, there was no Michael Saylor. There was Mt Gox, the block wars etc. You buy bitcoin at the price you deserve.

31 points by codetrotter 3y ago

FWIW, love or hate Bitcoin, the 4th Bitcoin halving is happening in 9 blocks as I type this, give our take 90 mins, probably a bit less.

m3kw9 3y ago
Is being used as pump fuel
pinkmuffinere 3y ago
How is this relevant?
- TacticalCoder 3y ago
  I think it's no coincidence that Kraken (a very old cryptocurrencies exchange) is publishing a post on its blog about Bitcoin the very day a Bitcoin halving is happening... Thought it was worth mentioning.
- npoc 3y ago
  The issuance, which is the main source of bitcoin for sale on the market (from the miners) is halving. value = demand/supply. It takes a few months for the supply reduction to filter through to the market, but then things get wild. Any other physical commodity such as gold for example, will naturally see a supply increase as the value increases (retired miners dusting off their picks to profit on the high prices) but bitcoin's issuance is hard fixed. No amount of effort will produce more bitcoin than 3.125 every 10 minutes. Mankind has never seen anything like this before.
gowld 3y ago
6 blocks ~60 minutes left. https://www.nicehash.com/countdown/btc-halving-2024-05-10-12-00 https://www.nicehash.com/countdown/btc-halving-2024-05-10-12... What happens to existing hardware at that point? Resold for video games? Sold to people who have cheaper electricity?
- TacticalCoder 3y ago
  > What happens to existing hardware at that point? Resold for video games? Sold to people who have cheaper electricity? I think some is sold to people who have cheaper electricity. Some miners shall probably also mine at a loss for a while, sitting on reserves, while smaller ones dies. Cannot resell for video games: Bitcoin is mined using dedicated ASICs since many years. And Ethereum, the second biggest after Bitcoin, is now mined using proof-of-stake (so neither GPUs nor ASICs involved). But in a few halvings (every four years, so in a "few halvings" I won't be here anymore) I don't understand how it'd work out: too little BTCs rewarded per block and I don't see tx fees paying the miners.
  - phire 3y ago
    > I don't understand how it'd work out: too little BTCs rewarded per block The math only works out if value of bitcoin continues to increase in value, at least a constant 25% annual return, year after year (on top of inflation). If the price of bitcoin ever stabilises (or worse, drops) over the long term, then the security of bitcoin will go down, until eventually it becomes viable for someone to launch a 51% attack.
    - tromp 3y ago
      Instead the security will rely on maintaining a large backlog of high fee paying transactions.
    - greyface- 3y ago
      100% return over 4 years refigured as constant annual return is 19%, not 25%, due to compounding.
    - woleium 3y ago
      difficulty also updates every couple of weeks. less folk mining means less energy per coin mined
      - phire 3y ago

odyssey7 3y ago

> Some predecessors, like DigiCash, were too reliant on trusted authorities and so never gained market acceptance. Aren’t bitcoin holders trusting that no authority/state actor is going to 51% attack the blockchain?

codetrotter 3y ago
A timeless classic on this question: https://m.youtube.com/watch?v=ncPyMUfNyVM https://m.youtube.com/watch?v=ncPyMUfNyVM
- npoc 3y ago
  I'd like to hear how he'd kick the bad actors off the network. Bitcoin is fundamentally permissionless.
drdeca 3y ago
I suppose, but, not on the basis of "they are granted the authority to do this thing, but will not abuse it", so much as, "it is costly for them to do this thing, and it is unlikely to be worth it to them" ?
_heimdall 3y ago
More specifically, bitcoin holders are trusting that some collection of entities with more than 50% share of the mining power won't collude. It seems like a reasonable assumption honestly, everyone would know and value would tank. I'm by no means a fan of bitcoin, but miner collusion was never what kept me away. I like the original arguments for bitcoin related to a decentralized currency and privacy. Neither have proven to be possible on the bitcoin blockchain and I see absolutely no value in btc if I have to use off chain solutions to make it fit any real world use case.
- odyssey7 3y ago
  If a party could control the irregular tide of Bitcoin’s value rising and crashing, then it holds a means to stimulate or impoverish whatever economies rely on Bitcoin. This could be particularly attractive for parties who want to avoid formally declaring sanctions or for situations where sanctions might not be effective. I would see a 51% attack as a nuclear option, since it could take a while for cryptocurrency users to once again believe that the network is secure, but you could imagine a situation where there is geopolitical conflict with a country, the people in that country adopt a cryptocurrency due to fiat currency collapse, and then it becomes useful to induce a cryptocurrency collapse as well. Edit: oops, might have added this comment in the wrong place.

RonToaster 3y ago

The overall premise is true but this is a very poor-quality article that has a few extremely obvious giveaways that it was AI-written.

dpiers 3y ago

Oh, please. Bitcoin is a protocol with no more inherent value than SMTP. Aside from being the Catholic cryptocurrency, it has been surpassed technologically in every way by newer and better designed protocols. Why would anyone who doesn't already own Bitcoin choose to use it for anything over, ex. Ethereum? Bitcoin maxis aren't technologists; they're grifters trying to convince you their magic beans are the most special magic beans.

r2_pilot 3y ago
>Bitcoin maxis aren't technologists; they're grifters trying to convince you their magic beans are the most special magic beans. Replace "bitcoin maxis" with any cryptocoin promoter and the statement remains true and equally as useless to those who refuse to consider digital coinage money.
- dpiers 3y ago
  I don’t disagree. Crypto is neat but has no useful (legal) real world applications.
  - npoc 3y ago
    Learn about money supply inflation and its enormous dilutive effects on the value of each currency unit. https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL
    - r2_pilot 2y ago
      Lol as if BTC or any cryptocoin is a store of value(instead of speculative tulips). One of the reasons why I refuse to accept crypto as money.
      - npoc 2y ago
        Regardless, take my advice

friend_and_foe 3y ago

> ...and this makes it incredibly unlikely Bitcoin will ever be outcompeted by a government or private market alternative. The premise of the article. I don't believe this for a second. Imagine the delusional hopefulness one would have to have to believe that something will, for eternity, not be superseded. Nothing in the history of humanity, or even life, remains unsurpassed from it's inception. Yet somehow this thing is unbeatable. There are cryptocurrencies out there that meet all of the criteria that is laid forth in the article as the reason for this conclusion. True, most, I'd say almost all, don't, as the article does point out, but some do. So what's the secret sauce that makes those currencies incapable if it isn't simply these criteria laid out? Is it magic? Is it some emergent property we have yet to comprehend? If so, why not say it in the article? No, the article says those traits are all you need to draw that conclusion and yet, there's no compelling reason why that's the case. It's hand waving. The criteria not mentioned is network effects. But we know, network effects are not an insurmountable obstacle. So the conclusion still does not follow. Those criteria are a must, and network effects make it incredibly difficult to supersede bitcoin, but not impossible. I say the opposite: bitcoin's demise is inevitable. Not because I don't like bitcoin, don't believe in it, think it's a scam. I am a bitcoiner. But because nothing lasts forever, bitcoin isn't perfect, and there are people out there trying to make it better that aren't getting their PRs merged and/or making it to consensus to become a part of the network software. I can think of at least one cryptocurrency that is better than bitcoin in every way, that meets all the criteria in the article, but just doesn't have the network effects. And to surmount that, the technical superiority, the benefit to the user to switch has to be so compelling that network effect diminishes. It's not enough to be marginally better, it has to be astronomically better. Maybe that one I have in mind doesn't have that, but you can bet that one will be made that will have that eventually.

tromp 3y ago

> Bitcoin’s success was about more than creating a new money; it was about creating a system to distribute value in a way that couldn’t be gamed and that didn’t unfairly advantage any user. Even Satoshi mined all the Bitcoin he received, just like everyone else. Bitcoin hugely advantages early miners/adopters by the exponential reward reduction over time. Every successive generation gets to mine 32x less of the supply than the previous one. A truly fair distribution would have an unchanging block reward. It would still be disinflationary [1], crucially setting it apart from fiat 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...

npoc 3y ago
Why shouldn't it advantage early adopters? Back when bitcoin was $100, $1000, even $10000, it was far, far riskier than it is now. Those people buying it then were coming onto boards like this, only to be ridiculed and dismissed as scammers. There was no Blackrock ETF, there was no Michael Saylor. There was Mt Gox, the block wars etc. You buy bitcoin at the price you deserve.