Is competition healthy for Bitcoin?

[franky1]

let bitcoin be the amsterdam currency for drugs, guns and prostitutes, along with cheap electronics. and let litecoin be for everything else.

Freedom is scary, isn't it?

it is when you got one guy spreading fud saying its in the name of freedom but then saying don't spread your wealth anywhere else. lol

if bitcoin gets out from just the 'amsterdam currency' niche market great. but at the moment the majority of bitcoiners are not helping themselves out beyond those markets.

having the freedom to choose which to push forward, should be just that, a freedom. no competition at all and a mindset of staying in a niche market wont help bitcoin at all. they need competition just to give them more incentive to thrive and to expand, else in 4 years time they will be saying "we have value because of silkroad" as their only defence that there is a constant supply and demand.

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[acoindr]

Hey, I agree with you on the LTC point. Competition is great! I wish there was a coin that actually provided something of value over Bitcoin.

There are two coins that do: Litecoin and Novacoin. The primary value they provide over Bitcoin is they are not Bitcoin.

Just for argument's sake pretend for a moment the Bitcoin Foundation became highly corrupted and subject to selling out to the highest bidder, perhaps even the government. That organization, to date, is made up of some of the most influential and powerful individuals and businesses in the Bitcoin community. As Bitcoin grew so could the power and notoriety of the Bitcoin Foundation, and with this the potential for complete disaster if there was only Bitcoin in the marketplace.

Alternatively, look at the most recent uproar over the discussion for change of block size. Like the creation of the Bitcoin Foundation this had potentially major implications for Bitcoin, and accordingly threatened to divide the community into those for and against it. Unfortunately, by involving the protocol itself the large economic damage caused by a messy fork would be secondary to damage in confidence of block chain based currency working at all.

If Bitcoin is the only show in town then as Bitcoin goes so goes the idea of crypto-currency overall.

On the other hand having other coins that exist apart from Bitcoin give the marketplace something else to evaluate, and provide another avenue of choice to express discontent; that's always healthy.

Sadly, LTC is just a clone with a few slight changes.

I don't think you fully appreciate the differences.

First, being a clone is a compliment showing how valuable the original protocol implementation is. However, a key difference is time between blocks being reduced from 10 minutes to 4 minutes on average. This means network transactions confirm more than twice as fast on average for litecoins than bitcoins. If you don't think fast confirmation time is valuable to the marketplace, especially as it grows, I'm not sure how to explain to you that it is.

The other difference is there is roughly 4 times as many litecoins as bitcoins. Economically this is less significant, but not entirely without effect. In general, theoretically, the more currency in existence the more widely it is likely distributed, meaning a larger overall potential marketplace.

Last, Novacoin unlike Litecoin provides a very real intrinsically valuable aspect over Bitcoin, which is the inclusion of proof-of-stake in addition to proof-of-work to guard against 51% attacks.

This explains why these two coins, out of all the ones in existence past and present besides Bitcoin, have notable and increasing value. The free market seems to agree with this or something similar which is reflected in the litecoin and novacoin prices, now $0.14 and $0.50 respectively. Anyone remembering Bitcoin in the early days might recognize the similarity in early price point.

[DoomDumas]

Cooperation is better than Competition..  That's why I do not embrasse competition of any kind !

[acoindr]

Hey, I agree with you on the LTC point. Competition is great! I wish there was a coin that actually provided something of value over Bitcoin.

There are two coins that do: Litecoin and Novacoin. The primary value they provide over Bitcoin is they are not Bitcoin.

Just for argument's sake pretend for a moment the Bitcoin Foundation became highly corrupted and subject to selling out to the highest bidder, perhaps even the government. That organization, to date, is made up of some of the most influential and powerful individuals and businesses in the Bitcoin community. As Bitcoin grew so could the power and notoriety of the Bitcoin Foundation, and with this the potential for complete disaster if there was only Bitcoin in the marketplace.

Alternatively, look at the most recent uproar over the discussion for change of block size. Like the creation of the Bitcoin Foundation this had potentially major implications for Bitcoin, and accordingly threatened to divide the community into those for and against it. Unfortunately, by involving the protocol itself the large economic damage caused by a messy fork would be secondary to damage in confidence of block chain based currency working at all.

If Bitcoin is the only show in town then as Bitcoin goes so goes the idea of crypto-currency overall.

On the other hand having other coins that exist apart from Bitcoin give the marketplace something else to evaluate, and provide another avenue of choice to express discontent; that's always healthy.

Sadly, LTC is just a clone with a few slight changes.

I don't think you fully appreciate the differences.

First, being a clone is a compliment showing how valuable the original protocol implementation is. However, a key difference is time between blocks being reduced from 10 minutes to 4 minutes on average. This means network transactions confirm more than twice as fast on average for litecoins than bitcoins. If you don't think fast confirmation time is valuable to the marketplace, especially as it grows, I'm not sure how to explain to you that it is.

The other difference is there is roughly 4 times as many litecoins as bitcoins. Economically this is less significant, but not entirely without effect. In general, theoretically, the more currency in existence the more widely it is likely distributed, meaning a larger overall potential marketplace.

Last, Novacoin unlike Litecoin provides a very real intrinsically valuable aspect over Bitcoin, which is the inclusion of proof-of-stake in addition to proof-of-work to guard against 51% attacks.

This explains why these two coins, out of all the ones in existence past and present besides Bitcoin, have notable and increasing value. The free market seems to agree with this or something similar which is reflected in the litecoin and novacoin prices, now $0.14 and $0.50 respectively. Anyone remembering Bitcoin in the early days might recognize the similarity in early price point.

Regarding your first point, I disagree entirely. The beauty of Bitcoin is that I can never be forced to use rules which I do not agree with. Yes, I can end up as the only person using a certain fork, but I highly doubt the anti-privacy government sponsored fork is going to be the one that survives, regardless of which organization supports it.

I actually look forward to a fork. Since I will have coins on both forks, I can immediately sell whichever coins I don't want and use the proceeds to purchase more of the coins I do want, in this example: original bitcoins. See, I am not afraid of the free market, as people who think Bitcoin can be corrupted seem to be. The market decides which coin is more useful, not the government, not an organization, and not the miners. Bitcoin is extremely resilient to anyone trying to corrupt it. Due to it's very nature it's impossible to enforce rules on anyone.

I certainly wouldn't mind using the tiny, obscure, original bitcoin if the majority of users decide an authority fork is more desirable. I've been here since Bitcoin was tiny and going back is not a concern for me. I will watch as the corrupt do what the corrupt will do and smile as people come running back to freedom.

Concerning alt coins not being Bitcoin.

Fast confirmations have no interest to me. You can argue until you are blue in the face that 10 minutes vs. 4 minutes is a some massive difference and I will simply laugh. In most online situations, the speed of confirmations changes nothing about how soon you will receive your products as they need to be shipped anyway. A digital good being delivered, on average, 6 minutes later is meaningless. In brick and mortar stores, they can choose various policies regarding how many confirmations are required, as if double spends are going to be a large percentage of consumer fraud. Buying a pack of bubble gum, I'm sure 0 confirmations is fine. Buying a new SUV, well by the time you finish the paperwork, you should have plenty of confirmations to satisfy any merchant. As layers get built on top of Bitcoin, such as banks, credit cards, and debit cards, confirmations won't matter at all. The merchants will settle with their banks at the end of the day, exactly like they do now.

Total number of coins is arbitrary and meaningless. This, of course, can be modified with a hard fork anyway.

Proof of Stake is fine for those who want it. I do not. I never have. It actually deters me from using that coin. Again, I have no fear that the market will decide.

Don't get me wrong, when an alt coin offers something different which I value, I will be more than happy to diversify my holdings. I simply disagree that they coins you've mentioned, or any for that matter, have offered something different which I value. To each his own of course and I do appreciate the fact that people can choose.

I don't have time to respond point by point. I'll just say your perspective is just that, how you're viewing things from only your perspective. I'm talking about implications for the broader market. As I noted the market seems to agree with my view, which can be seen in the free market price of those two coins.

[bullioner]

I actually look forward to a fork. Since I will have coins on both forks, I can immediately sell whichever coins I don't want and use the proceeds to purchase more of the coins I do want, in this example: original bitcoins.

The transaction is likely valid on both forks, so will end up finding its way into blocks on both, right?

[Mjbmonetarymetals]

http://youtu.be/l4CZfLmUJV4 - any opinions on this viewpoint stated here ( 3mins in )

[allthingsluxury]

In my opinion competition is always healthy. It helps drive innovation and change.

[Uglux]

Cooperation is even better

[mccorvic]

Alt-coins: For people who want to see both their bitcoins and alt-coins become worthless!

Anyone who has spent 5 seconds thinking about it realizes that if LTC or whatever scam-coin succeeds then all crypto-currency fails.  Anyone who disagrees has simply hoarded their LTC and is hoping you'll be stupid enough to buy it from them.

/thread

[Wekkel]

Anyone who has spent 5 seconds thinking about it realizes that if LTC or whatever scam-coin succeeds then all crypto-currency fails. 

So if BMW wins in terms of car sales, all car sales will plummet and the industry will die? Better rethink this over.

[misterbigg]

Litecoin is the noise to Bitcoin's signal.

[mccorvic]

Anyone who has spent 5 seconds thinking about it realizes that if LTC or whatever scam-coin succeeds then all crypto-currency fails. 

So if BMW wins in terms of car sales, all car sales will plummet and the industry will die? Better rethink this over.

People keep making this analogy. People who make this analogy are not good at analogies.

[nwbitcoin]

Competition is very healthy even at this stage because we are in new territory.  Nobody knows if and when the system is going to turn on crypto currencies, and having bitcoin in the lead, with Litecoin a safe distance behind, does mean that if Bitcoin makes a fatal turn, Litecoin can take another path.

There is also a very strong US centric focus on bitcoin, which really doesn't work well in the rest of the world.  Maybe Litecoin will be the preferred option in Europe, and that will be its niche - but for now, lets just let the market decide!

[mccorvic]

There is also a very strong US centric focus on bitcoin, which really doesn't work well in the rest of the world.  Maybe Litecoin will be the preferred option in Europe, and that will be its niche

Why would this be helpful to anyone? "Hey everyone, you now have to pay extra fees to some exchange in order to send money to each other."  So, now the LTC scammers are trying to tell you that, in addition to trying to negate the non-inflation aspect of bitcoin, that its also beneficial to negate the low fees/easy to send aspect to?  Please stop listening to these people.

[Wekkel]

Anyone who has spent 5 seconds thinking about it realizes that if LTC or whatever scam-coin succeeds then all crypto-currency fails. 

So if BMW wins in terms of car sales, all car sales will plummet and the industry will die? Better rethink this over.

People keep making this analogy. People who make this analogy are not good at analogies.

The best coin will succeed. There is no need for one single coin only. In that respect, the analogy applies.

[Uglux]

There is also a very strong US centric focus on bitcoin, which really doesn't work well in the rest of the world.

I would rather say, that the US has a very strong centric focus on competition, which really doesn't work well for the rest of the world.

Bitcoin was born in a competition of ideas, but the process of its development is highly cooperative.

[mccorvic]

Anyone who has spent 5 seconds thinking about it realizes that if LTC or whatever scam-coin succeeds then all crypto-currency fails. 

So if BMW wins in terms of car sales, all car sales will plummet and the industry will die? Better rethink this over.

People keep making this analogy. People who make this analogy are not good at analogies.

The best coin will succeed. There is no need for one single coin only. In that respect, the analogy applies.

Sigh. So, let's say that there are 100 people in the world that want cars. Like, tops (simple explanation here).  Let's say that one car company sells all those 100 their cars.  If a new company starts, then yes, the value of the first company will be diminished.  Now, in the real world the market is continuing to expand and the first company has many opportunities to make new products, expand the market, ect.  None the less, the one thing we CAN say is that people are pretty convinced of the value of the car and will continue to want one, no matter who sells it to them.   Hell, if I buy a car and two weeks later the company I bought the car from goes under, it's still a car that works. It drives me places.

And that is where your terrible analogy falls apart.  LTC is a poor, script-kiddies copy of BTC in every important way. It does nothing significantly different than BTC.  At the same time, there are people investing and working hard of getting people to adopt crypto-currency as viable, sustainable, and important.  You know what undermines this? LTC.  People are smart enough to realize that if any two-bit script-kiddie can just make up an alt-coin that actively devalues their investment, they're not gonna buy it.  Who wants to play the "Oh, this new crypto-currency is better so you better dump everything right now and switch!" game?  What good is an investment in LTC if, one-year from now, super-LTC gets released and does everything regular LTC does but maybe slightly different.  What good is an investment in super-LTC if Mega-LTC comes out a year after that and does things just a little different.

And that, sir, is why your analogy is terrible.  

[nwbitcoin]

There is also a very strong US centric focus on bitcoin, which really doesn't work well in the rest of the world.

I would rather say, that the US has a very strong centric focus on competition, which really doesn't work well for the rest of the world.

Bitcoin was born in a competition of ideas, but the process of its development is highly cooperative.

That isn't really what I meant.

Crudely, anything with a big US flag on it, is generally hated in the rest of the world! Ok, a huge over simplification, but it stands to reason that anything that is too closely linked to a part of the world, will tend to have its lovers and haters.

Politics is something you can't ignore when it comes to business!

[mccorvic]

There is also a very strong US centric focus on bitcoin, which really doesn't work well in the rest of the world.

I would rather say, that the US has a very strong centric focus on competition, which really doesn't work well for the rest of the world.

Bitcoin was born in a competition of ideas, but the process of its development is highly cooperative.

That isn't really what I meant.

Crudely, anything with a big US flag on it, is generally hated in the rest of the world! Ok, a huge over simplification, but it stands to reason that anything that is too closely linked to a part of the world, will tend to have its lovers and haters.

Politics is something you can't ignore when it comes to business!

I do disagree with the idea in general that BTC is "US central" as in when anyone thinks of BTC they think its for Americans.  I'd be interested in any evidence to the contrary outside of "most people on bitcointalk.org" are Americans.

[smoothie]

Litecoin is an ALTERNATIVE to BTC. That isn't a bad thing unless you are scared that bitcoin will lose value because you have a huge stash of BTC.

Freemarket = Competing currencies.

Litecoin has happened and will continue to be alive as long as people believe it has value. Just like bitcoin.

You can send instant payments globally with both systems. One is just faster.