|
Title: What if future transaction fees don't compensate enough? Post by: minerva on January 09, 2014, 02:43:31 AM What if these insufficient transaction fees causes miners to accept only higher fees, and this encourages miners to only accept even higher fees. Because of these high fees, people stop transacting.
Perhaps the only way to compensate is inflation? Title: Re: What if future transaction fees don't compensate enough? Post by: markf78 on January 09, 2014, 03:04:55 AM What if these insufficient transaction fees causes miners to accept only higher fees, and this encourages miners to only accept even higher fees. Because of these high fees, people stop transacting. Perhaps the only way to compensate is inflation? I personally think the only mistakes of the original bitcoin design (if it really was originally designed to be a currency) was not instituting a fixed target of 2% inflation - a nominal amount ensuring things today will be cheaper than they will be tommorrow -- forcing bitcoin users to lean toward spending & investing but not hoarding. It is for this reason I expect the CFTC to classify bitcoin to be a commodity similar to gold and not a currency like the dollar/euro/yen. Title: Re: What if future transaction fees don't compensate enough? Post by: Rannasha on January 09, 2014, 10:21:15 AM What if these insufficient transaction fees causes miners to accept only higher fees, and this encourages miners to only accept even higher fees. Because of these high fees, people stop transacting. Perhaps the only way to compensate is inflation? If fees aren't enough for the average miner to break even, the least efficient miners will stop mining, the difficulty will go down and profitability will go up for the remaining miners. Title: Re: What if future transaction fees don't compensate enough? Post by: Vandroiy on January 09, 2014, 02:06:07 PM What if these insufficient transaction fees causes miners to accept only higher fees, and this encourages miners to only accept even higher fees. Because of these high fees, people stop transacting. Perhaps the only way to compensate is inflation? If fees aren't enough for the average miner to break even, the least efficient miners will stop mining, the difficulty will go down and profitability will go up for the remaining miners. Interestingly, this happens almost indefinitely. Under ideal conditions, neglecting block limits, difficulty drops arbitrarily low. The transaction fee is therefore determined by the block limits and the amount of transactions. Sadly, it's not self-regulating in the sense that the minting of new Bitcoins is now. I kicked off a discussion about this back in 2011 (https://bitcointalk.org/index.php?topic=6284.0 (https://bitcointalk.org/index.php?topic=6284.0)). By now, the common answers are that either block limits will remain or the block chain will be secured by insurance companies that stockpile mining equipment and aid the older branch in case of a fork. In the latter case, look at the bright side: less wasted electricity and less problems with difficulty oscillations. :P Heh. Look who was debating in that thread, it's a who's who of Bitcoin now. I was only on a single Bitcoin conference and met a lot of these guys, heard of their products or projects, there's the devs and admins... now who wants to say the topic is boring and simple? ;D |