Feedback Patterns in the Bitcoin Economy

[Zangelbert Bingledack]

Was playing around in MSPaint, thinking about how everything interrelates. The green arrows mean "drives." Thoughts?

[AsymmetricInformation]

Normally I hate stuff like this, but this one I really like.

You do need a 'X Website Hacked' node fed by 'Bitcoin Price' with a big red arrow back to 'Bitcoin Price', though, I think! Maybe a 'Ponzi' node as well! 

[DannyHamilton]

Was playing around in MSPaint, thinking about how everything interrelates. The green arrows mean "drives." Thoughts?

I'd change "Higher BTC price" to "Higher BTC exchange rate" (or "Higher BTC exchange ratio" or "Higher BTC exchange value")

Then I'd add a green arrow from Merchant adoption to "Higher BTC exchange rate" and another green arrow from User/community adoption to "Higher BTC exchange rate".

There is probably a green arrow from "Higher BTC exchange rate" back to "Long-term investment interest", since the prospect of increased returns drives people to transfer wealth into bitcoin.

[knight22]

Media interest doesnt rise only because of higher price of bitcoin but also with major events surrounding it.

[DeathAndTaxes]

I would remove the line between user adoption and media.   It is very difficult to directly measure user adoption and it certainly isn't something the media is trying to do.  The media "ballparks" adoption by indirect methods like the exchange rate (value of money supply), and/or merchant adoption.

[DannyHamilton]

Media interest doesnt rise only because of higher price of bitcoin but also with major events surrounding it.

I believe that's covered with the green arrows from "community adoption" and "merchant adoption" to "media attention"

[DannyHamilton]

. . . It is very difficult to directly measure user adoption and it certainly isn't something the media is trying to do . . .

Sure but user adoption still drives media attention.  Users contact the media. Some of the media perhaps are users.  Users discuss bitcoin in public forums (such as G+ and bitcointalk.org) where the media creators encounter it in search results and investigation into related topics.

[molecular]

Was playing around in MSPaint, thinking about how everything interrelates. The green arrows mean "drives." Thoughts?

if you wanted, you could try inkscape, a nice opensource vector drawing tool also available on windows next time you do something like this.

really like the content. well done

[markm]

Darn, no "maximum block size" nor even "transaction volume", but supposedly the sky would fall without bigger blocks, if so surely that warrants an arrow or some arrows somewhere?

-MarkM-

[Vernon715]

Darn, no "maximum block size" nor even "transaction volume", but supposedly the sky would fall without bigger blocks, if so surely that warrants an arrow or some arrows somewhere?

-MarkM-

LOL

[DannyHamilton]

Darn, no "maximum block size" nor even "transaction volume", but supposedly the sky would fall without bigger blocks, if so surely that warrants an arrow or some arrows somewhere?

-MarkM-

Yep.  Need to add Transaction Volume and Transaction Fees to the graph and the following green arrows:

User/Community Adoption => drives => Transaction Volume
Merchant Adoption => drives=> Transaction Volume

Transaction Volume => drives => Transaction Fees

Transaction Fees => drives => User/Community Adoption
Transaction Fees => drives => Merchant Adoption
Transaction Fees => drives => Mining Profitability

[molecular]

Transaction Fees => drives => User/Community Adoption
Transaction Fees => drives => Merchant Adoption

How to these 2 work? Shouldn't fees dampen Adoption?

[DannyHamilton]

Transaction Fees => drives => User/Community Adoption
Transaction Fees => drives => Merchant Adoption

How to these 2 work? Shouldn't fees dampen Adoption?

Higher fees drives lower adoption.
Lower fees drives higher adoption.

The idea being that fees have a direct effect on adoption.

[markm]

Yeah maybe use red arrows for drives down and green for drives up?

-MarkM-