FED constantly adjust their money supply because their money is created out of nothing and its value totally depends on inflation. High inflation will quickly destroy their paper money's value and confidence altogether. That's the reason when inflation picks up, they will immediately raise the rates, even they know that will kick the economy into recession and cause lots of people to lose their job. They don't care, because if the fiat money is crashed, then the whole game is over for them

Bitcoin is different, it has a constant cost that can be calculated easily, so even there is inflation (bitcoin's value going down), people still have a sort of anchor of its value through mining cost. And because the money supply schedule is known, the confidence that bitcoin will hold its value is easier to maintain than fiat money

I remember that during 2012 reward halving, there was a small team who made a "50 coins per block forever" fork, and Gavin even worried about that the fork might gain some momentum. But that fork died after some time, indicating that a coin of unlimited supply is of no interest to majority of the miners

In my opinion, a constant money supply model have 2 difficulties:

1. Economy always goes up and down, expanding, contracting, eventually getting slower and slower. So if the number of coins will always increase while the economy can not grow forever, the coin have a risk of losing their value in future for sure, thus give people a bad long term perspective

Because most of the coins were hold for the long term, the daily coin supply on market will be less and less in a progressively decreasing coin supply model, thus generating a positive expectation of future value increase. However in a constant coin supply model, the daily coin supply on market will be more and more, thus will not guarantee a future value increase even the economy also grows

2. It becomes difficult to differentiate from fiat money system, which also has unlimited total money supply. An inflative monetary system is what bitcoin tries to fight against. It seems to be an inflation or deflation question instead of a choice of specific parameters


Suppose that in future the coin supply changed to 1 bitcoin per block forever, then the yearly coin supply is less than 0.25% of the total coin supply, thus will not be able to trigger any observable inflation. But I guess by that time the fees from transactions are already higher than 1 bitcoin per block, so that it does not make a lot of sense from miner's perspective

Enlightenment

Perfectly suit this modified quote from The Matrix

"The fiat money system is humanity's slavery. But when you're inside, you look around, what do you see? Businessmen, teachers, lawyers, carpenters. The very minds of the people bitcoin is trying to save. But until it does, these people are still a part of that system and that makes them its enemy. You have to understand, most of these people are not ready to be unplugged. And many of them are so inured, so hopelessly dependent on the system, that they will fight to protect it."

Nice piece of hardware, but the needed power consumption is only for data center like buildings

The time has not come yet. To spend bitcoin, you must first have bitcoin, and then hold it for several years until its value doubled many folds, and then you start to spend a small part of it

And as long as exchanges exists, people can always sell for fiat money and then spend fiat money more conveniently. The only people who has to spend bitcoins are those who are traveling abroad and lacking a good means of access local fiat currency

It is in fact a large topic about reward halving, I guess Satoshi must have put lots of consideration in this area

There are basically 3 types of money supply scheme:
1. exponentially increasing (fiat money)
2. linearly increasing (Dogecoin)
3. limited (Bitcoin)

In fact, 2 and 3 are almost the same from macro economy point of view: After some decades, the increase in total money supply in 2 will become so insignificant percentage wise, that it is almost like fixed (If the money supply increases 0.1% per year, then its impact on inflation is almost the same as limited total money supply)

So for the sake of simplicity, Satoshi went for model 3, which could give a very clear signal of limited total money supply

Then he had to decide how those limited coins will enter circulation over time

There are basically 3 types of distribution model:
1. distribute using a progressively increasing schedule
2. distribute equal amount of coins each year for xxx years until reach the limit
3. distribute using a progressively decreasing schedule

It is clear he didn't want to use model 1 or 2: If bitcoin indeed take off and gained mainstream popularity, then large banks with lots of resource will easily control majority of the coins at later stage. Those who are interested in the idea must be able to control a large part of the bitcoin when it is still in its infancy

So a progressively decreasing schedule was selected. Then how fast and how often the block reward will drop will be decided. It must consider the speed the information is spreading on internet, give early pioneers enough time to react, but it should also leave enough incentive for late adopters to continue strengthen the network until the fee income replace the block reward

If the reward drops too fast, it will reduce the late adopters' incentive thus might fail to attract enough support before it reach mainstream. If the reward drops too slow, it will be close to model 2 thus give large institutions enough time to control majority of the bitcoins. 4 years period is already a long time for any IT related projets, so let half of the coins distributed during 4 years sounds like a decent pace

Why 50% drop every 4 years instead of 16% every year? I have not figured out a good reason, maybe to make the mining anticipation simple and relatively stable during a 4 years time. Could also be a strong anticipation of price rally every 4 years, thus everyone is at least hold their coins for 4 years, encouraging long term saving

I guess the mining will provide the device some income through electricity, so that it can pay other AIs on the internet to get what it requires. I remember some years ago there is a talk about AI, once an AI become economically independent, they will spawn their children and these children can be "rich kids" if their parents are with lots of bitcoins

It seems AI only need maintenance and electricity, so they could simply buy electricity or repair service with bitcoin, thus become totally self sustainable

A society of home electronics, trading against each other using bitcoin as official currency. But what you can buy from another machine?

You purchase bitcoin through purchase electricity, thus bypass the exchange. But the cost of that machine is much higher than the electricity cost, so it must be sold together with home electronics

But micro transaction kills bitcoin network, so those micro transactions will be merged together at IOT manufacturer's central server and settled from there

That's a good point: Machines convert electricity into bitcoins and pay for services

That's it! If you program based on instructions sent from 21 Inc, you will receive 1 bitcoin per 1000 lines of codes, directly paid into your wallet on this little thing    And their huge R&D project now becomes a distributed programmers' network   But to pay $400 to join this freelance network ...

1) To have a limited total money supply, and by doing so, to be on the opposite side of today's monetary system, where central banks rob the wealth of the currency user by printing more money. This is clearly indicated in the genesis block

2) The system will provide maximum protection for its users' wealth, thus get maximum support from its users and increase its robustness for the whole ecosystem

3) Currency users are benefited most

4) Bitcoin from the beginning can have many other reward halving schemes, or a constant supply,  or even constant inflation rate like Milton Friedman suggested. But without forced circulation like fiat money, it is very likely no one will care about it if it does not have a clear benefit of limited total money supply

The whole point of bitcoin is to provide a totally different monetary policy than legacy system and see if it is more successful, and so far it is.

Imagine that from the beginning bitcoin have constant supply 50 coins per block forever, then very likely another coin with reward halving will become more popular among users (due to stronger long term appreciation potential), attracting more capitals and eventually overtake bitcoin. Because the cryptocurrency are voluntarily used, if you don't have a good long term incentive mechanism for its users, no one will care

Bitcoin's soul is consensus. Notice that the property of "fixed total amount of coins" can be selected by each participants by simply using the fork that have this property, unlike in legacy financial system you don't have any choice but passively accept whatever monetary policy central banks make

Good questions, the reason that most of the central banks mechanism are not known is because only a few people have the access of such level of information and they never reveal the truth to majorities because it is just layers and layers of illusions and scams

Maybe you can get an overview by watching <The Biggest Scam In The History Of Mankind> : https://www.youtube.com/watch?v=iFDe5kUUyT0

It is very interesting to see the banks testing the baseline of people's tolerance: If that tolerance seems to be extremely high, then they would add another 1% negative interest, and if still no one complains, they add another 1% ... Until at some point it suddenly failed altogether

Every one is a lab rat in the banker's monetary laboratory, while the Satoshi laboratory is testing exactly the opposite: They add interest 16% per year, regardless of people's reaction, which drives people crazy  

Holding paper money is the only way for normal people to defend against a negative interest environment. By removing paper money, banks can easily pressure people to spend their money by charge interest for their money in the bank account

And that's where bitcoin will take over

You can tune the parameters a little bit to make the reward having more gradual: Like reduce the reward to 84% every year instead of 50% every 4 years, but overall the reward halving is equal to a 16% increase in difficulty per year, very mild effect comparing with difficulty jump we have seen during last year, so it should not make too much impact for the miners

However, considering that even changing the block size is super difficult, I don't think there will ever be a slightest chance of changing the reward having schedule

Miners are only a small part of the community, even if 70% of miners are not following the major consensus and successfully fork their chain, the coins on that chain will not be accepted by exchanges and merchants, basically becomes useless. And the majority of the communities will dump their pre-fork coins on that useless chain to drain the new coin's value on exchanges if there is any

Many early adopters were wiped out because they buy high and sell low 

I guess anyone that is technically capable of running this thing already have enough hardware to setup the similar function with dedicated platform and much higher performance

The unique part is that trading platform (built-in and close sourced), which does not make lots of sense since other dedicated trading solutions already exists today

I would more like to see a POS terminal which accept mobile bitcoin payment, but that is also not necessary since anyone can setup a tablet with much lower cost

There are so many rich people in this world, 21 Inc. just proved that  

I have never really understood the ambitious idea of 21 Inc. After seeing this I'm more confused. It does not fit into any practical use I can think of... A freelance market for developers? Who is going to buy those software/app? Another guy having same 21 bitcoin computer?  

Micro payment is a dead end, many enterprises have tried and gave up in favor of bulk rate charge model