Question about growth potential

[intrigid]

Hi all. First post. I got my first crash-course in Bitcoin on Friday while listening to Tom Woods. Over the weekend, I've spent hours and hours reading about BTC.

I've searched the forum and googled and can't seem to find a discussion about this:

I've heard people say that BTC will never replace existing currencies, only complement them. The main reason given is that verifying BTC transactions is computationally intensive, and this will only get worse over time. Does anyone have any real insight on this?

Does this mean that if the number of users grows by another 100x, the network could be bogged down to an usuable state? Or could the currency eventually grow to a billion users, supported by improvements in the code and hardware advancements?

[vm1990]

realistically i cant see the network getting to bogged down no matter how many users use it the more users use it the more transactions there are and the more people will earn when mining if however no one at all used transaction fees at a point in the very very very distant future it will slow down the conformations but its unlikely bitcoin will last that long and even more unlikely that we will be around to witness it

and also the more users use it the more valuable a bitcoin becomes because there are only so many bitcoins out there

you might even find (if and when) the last bitcoin is issued by the network bitcoins could be worth $100's maybe even $1000's

the only realistic way i can ever see the network getting bogged down to and unuasble state is if the bitcoin market crashes not a small crash but a full on crash where 2 bitcoin is worth $0.000001 or less and EVERY miner just stops even

[intrigid]

Wait, why do you believe that Bitcoin will eventually die off?

[luckyindia]

The growth rate of BTC will be the same as that of the internet..If governments  recognise  growth rate and value will be more. The crash of BTC is just imaginary n not practical

[vm1990]

the only way bitcoin will die off is worst case scenario (very very unlikely) alot of things have to go very very bad for it to happen but anything is possible and bitcoin only has a limited number of bitcoins the network will get to a point sometime in the very very distant future where it stops generating new bitcoins this is where bitcoin will make or break im probably talking atleast 50 years in the future

[DeathAndTaxes]

Some people believe Bitcoin will not replace sovereign currencies for non-technical reasons.  Governments are reluctant to give up their ability to control their own money supply.  Governments have the trump card of demanding payment of taxes in legal tender which means there will always be some demand for sovereign currencies.

Still with Bitcoin current usage a tiny fraction of even say PayPal those worried about it not becoming the one currency to rule them all seems myopic.  Lets look at Gold as an example.  The value of all refined gold is >$10T with 95%+ of that simply being a store of wealth.  If gold had low transaction costs (especially in digital space) it would make an awesome alternative currency.  However gold does not and never will have the low transaction costs needed to compete with fiat currencies (whose true costs are subsidized by taxpayers).  Say Bitcoin "fails" at replacing all sovereign currencies and only has a money supply worth that of gold.   Oh noes, the worlds largest open payment network worth more than ten trillion USD?   What an utter failure.  Lets pull the plug.  Actually given that limits the upside to only 20,000x todays valuation lets just give up now.

[intrigid]

Some people believe Bitcoin will not replace sovereign currencies for non-technical reasons.

I know, and I don't find those arguments very compelling. I think security and performance are the ONLY obstacles to a crypto-currency becoming the world's reserve. I'll explain why below.

Governments are reluctant to give up their ability to control their own money supply.  Governments have the trump card of demanding payment of taxes in legal tender which means there will always be some demand for sovereign currencies.

I see this argument a lot and I have to say that people who make it are failing to think things through. The very fact that citizens face taxes and inflation in fiat currencies is in itself motivation for citizens to abandon fiat and move toward BTC. As more and more people do so, the ability for governments to tax drops off dramatically. As government's ability to tax disappears, so too does their ability to enforce tax laws (and all other laws, mind you).

To put it in a nutshell, governments may be reluctant to give up their power, but that's kind of like saying a terminally ill person is reluctant to die.

[vm1990]

i think this could be a long long discussion XD bitcoin as many things has lots of pros and cons other than pure gold bars ill put it right up there as one of the more stable currency's be it digital or non digital