No, it is not responsible as human beings to waste electricity.
The Sun wastes about 3.846 × 10 20 MW. I don't see why humans must bear responsibility for such an piddling amount. |
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A cryptocurrency that cost nothing to make will eventually worth nothing, because it is voluntarily participated. Why should I pay 200 dollar for something that cost nothing to make??? Suppose that you can generate 1 bitcoin today with a cost of 1 dollar, then everyone will immediately go to generate coin and sell it on market for $199 of profit right away, that will drag the price down to 1 dollar.
First, if I gave 144 people 25 bitcoins each, and they sold them, what would happen to the price of a bitcoin? According to you, the market would collapse because it cost them nothing to gain those bitcoins. Obviously, it wouldn't because there are enough free bitcoins to affect the market. You can't generate an unlimited number of bitcoins, so you can't drag the value down to the marginal cost. Second, suppose Bitcoin was premined and 1 bitcoin was given to each of 21,000,000 people. Would the value of the bitcoins forever be 0? What if other people wanted some? What if people wanted two or more? What if one person managed to collect 10,000 and got someone to trade two pizzas for them? Would the value still forever be stuck at 0? No. Don't you see? The value of a bitcoin has nothing to do with the cost of creating it. The supply of bitcoins does not depend on their value and bitcoins are not consumed. The economics of gold, oil, and other commodities do not apply to bitcoin. |
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1. Regardless of the efficiency of the mining equipment and the cost of electricity, the total value of the energy used will be around the value of the bitcoins mined. If mining equipment becomes more efficient, the amount of energy used won't go down, the amount of mining equipment will go up.
2. Halving the block reward subsidy will halve the value of energy spent on mining (assuming that the price stays the same). It will not increase it as you claim.
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The effect is called an "antique" finish, and it is popular because it gives the coin's strike more depth. I prefer pure silver, but I don't mind it as much as painted or colorized silver coins.
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... All risks related to the ownership/use of Bitcoin should be borne by the owner/user of the Bitcoin and other virtual currency.”
In other words, if you want to use Bitcoin, you have to take responsibility for your own actions. Everyone else can act like babies, and depend on the state to tell them what to do. |
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There is a lot of wishful thinking, speculation, and random guesses in this thread. I can do that too.
It seems pretty straightforward: half the bitcoins, half the price. Sell now.
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Ultimately, money serves to facilitate the exchange of goods, and a slightly depreciating money does this better than an appreciating money (or just time invariant money)...
Money serves to facilitate the exchange of value, and "better" is a matter of opinion. I prefer a constant value, and slightly appreciating or depreciating values are equivalently inconsequential. |
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So regarding the group of developers - are they a set group, or is it a free-for-all system where anyone wishing to implement changes can join the group? I'm assuming that the group of developers will need to agree by themselves on whether to implement the changes or not, rather than asking the consent of each and every miner or person sustaining the network? It's true that consensus from the community is sought before implementing changes, but how many BTC users actually participate in the discussion? I understand that ultimately the users and miners will be the ones deciding whether to accept the changes or not via adoption, but then again, someone has to implement these changes at a higher-up level, aka the developers.
Bitcoin is a protocol. Anyone can write software implementing the protocol, and many have. The legacy software implementing the protocol is called Bitcoin Core. The people that control that particular Github repo are known as "Core" developers. Ultimately, it is the miners that determine consensus. They can choose or write whatever software they want for mining, so if a developer wants to move Bitcoin in a certain direction, they have to convince a majority of miners to use their software, or at least implement their proposal. |
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The whole network's distributed and nobody is in charge of making decisions. The majority of people running network nodes decide whether to accept a change or not by upgrading the Bitcoin software they use to a new version containing the change.
There is a group of developers who code changes into the software, but anyone can suggest changes they could make, and if they approve the developers will include the change in the next software version they produce.
Keep in mind that there is no "The Software". Anybody can make any change to their own code. The trick is to get others to make the same changes. Right now, most bitcoin developers tend to follow the code in Bitcoin Core, but that could change (perhaps even in a few months if enough people switch to Bitcoin XT). |
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Shorting helps stabilize the market by making bitcoins available for buyers to buy.
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The subsidy halves after every 210,000 blocks (see the bottom axis). That takes approximately 4 years.
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You could add this to the command instead of making the links: -datadir=x:\BitCoin
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You cannot assume that difficulty is constant. If miners can produce bitcoins for less than their value, then they will increase their capacity and the difficulty will increase until the cost of mining reaches the value of the mined bitcoins. I suppose there might be shocks that shift the supply curve temporarily, but otherwise, value drives cost and not the other way around.
No kidding you can't, but in scientific inquiry being able to see how things change by holding all else constant gives insight into how the world works! Also cost of production influences price in nearly every market for produced goods, not only commodities. There is a ton of research on this subject in economics. Look up "cost plus pricing" to get an intro. As for miners vs. traders all you need is enough miners to sell close to cost for this to work, you don't need each one to. In fact, many miners hoard or speculate on price. On the other hand, those in the business of mining are producers who sell as soon as they are made. Especially the Chinese mining farms. -- Take the analogy with the oil market. There are many more non-producers involved in the oil market - whether it is traders, consumers etc. and yet the price of oil usually trades around its cost of production (extraction + refinery & transport) The critical difference is that bitcoins are not consumed. That changes everything. Your oil, commodity, and produced goods analogies are all not applicable to the Bitcoin market. In the Bitcoin market, producers have little influence on the supply of bitcoins, so they little influence on the price. |
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The CIA or NSA want to crack passwords. So, instead of simply building a chip that hashes data using various hashing algorithms, the CIA or NSA develops a revolutionary payment system with the hope that four years later some Chinese dudes are motivated to develop chips that do a very specific kind of hashing that might not even be useful for cracking passwords.
Yeah, that makes sense.
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Wouldn't the total yearly budget deficit be destroyed simply by adding a surtax to the incomes of the super mega duper millionaires? Start with those who whine that their rates are too low - change their rates to 70% of their income or something, and disallow all deductions. And to harden social security, make their social security tax to be 15% of their income.
France actually tried something to that effect. Though I don't know how it fared in the long run (I guess we should ask Arthur Laffer), but I heard some celebrities giving up their French citizenship... That's indeed the problem, when you tax the super rich guess what happens... they leave to Switzerland and alike places. The only thing that could stop them is public shame, so those that are public figures (top athletes, actors, etc) are risking that their native fanbase starts hating on them. But the anonymous rich bankers and so on? these guys simply don't give a fuck, they'll just move the money. The U.S. is different. Leaving the U.S. doesn't matter. If you are a U.S. citizen, you must pay income tax no matter where you are in the world. The only way out is to renounce your citizenship, and even then you are handed a hefty tax bill. |
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of course cost determines price. in a market where a large number of producers compete to sell their product, they will undercut each other driving price down to cost of production. ... The one unique difference is that bitcoin has a fixed rate of supply (1 block each 10 minutes) so the elasticity of supply manifests itself in the difficulty instead of changing the rate of supply to meet changes in demand.
so what happens if mining hardware becomes twice as energy efficient? holding difficulty constant, miners will be able to sell each bitcoin at a lower and lower price until it again approaches this new (lower) cost of production. If difficulty increases, this will serve to increase the cost of production (the same hashrate will now find effectively less BTC per day than before the difficulty increased) so it acts as a bit of a stabilizer -- so the question is what will progress faster? The network size (which raises difficulty and cost of production) or technological progress?
You cannot assume that difficulty is constant. If miners can produce bitcoins for less than their value, then they will increase their capacity and the difficulty will increase until the cost of mining reaches the value of the mined bitcoins. I suppose there might be shocks that shift the supply curve temporarily, but otherwise, value drives cost and not the other way around. So what happens when the block reward is halved? Well the marginal product is cut in half while the cost remains the same, or in other words the cost to produce a bitcoin goes up. That means that your personal breakeven market price has just doubled. If the network average also reacts similarly, the market price should also double.
Miners are not the only traders. Newly mined coins are only a small part of the market. Miners have only a small influence, if any. The result of the halving will be that enough miners stop mining that the difficulty and cost adjust to a point where mining is profitable for the rest. There is no mechanism by which mining cost affects the value. |
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thanks for the input. are there dangers with storing btc on your phone?
There are two dangers particular to mobile devices: 1. Losing your bitcoins when you lose, break, or wipe your phone: You must back up your wallet or wallet seed. If you do, then you can always restore your wallet on another phone. 2. Losing your bitcoins through theft of the phone. If your wallet is not encrypted, then somebody can steal your bitcoins by stealing your phone. The wallet must be encrypted and allow access only with a password. If you do that, then nobody can steal your bitcoins. Do not use a wallet that does not protect against either of these dangers. |
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I have bought a lot of bitcoins from Circle. They are very convenient. The drawback is that you give them direct access to your bank account.
I cannot recommend Coinbase because they track you and they will ban you if they don't like what you are doing with your bitcoins.
As for a wallet, Bitcoin Core is not a great choice. Before using it, you have to download the block chain (which can take days). And every time you start it up, it has to validate its database and sync the block chain (which takes several minutes).
I recommend Airbitz on your phone because it is very easy to use and very secure, and Electrum on your computer.
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