$504000 per day

[veteranBtc]

Litecoin is $16,000 per day 

If litecoin can do $16,000 / day, bitcoin can do $1M / day, no problem!

1 Million/day is a dream came true 

[Peter Lambert]

It's obviously way more than enough to prevent double spends.  But the inflation schedule is not debatable, and the exchange rate is not controllable, so go be windbags about something else.

The inflation schedule is not debatable, and the exchange rate is not controllable, but if the amount given to miners is not sustainable then the price will trend downward (or upward if the amount is to low) until it reaches a point that is sustainable. The point of the discussion is to try to figure out what amount is sustainable.

Litecoin is $16,000 per day 

If litecoin can do $16,000 / day, bitcoin can do $1M / day, no problem!

1 Million/day is a dream came true 

1 million/day would only be 3x where we are now. At the rate we are going the past few weeks we could hit that in the next month.

[mitty]

Also keep in mind that the network difficulty tends to be directly correlated to the exchange rate.  Right now the few ASIC owners are making an incredible profit while everyone else's mining proceeds are staying somewhat consistent.  Of course the exchange rate changes faster than the network difficulty, but my point is that over time mining will eventually stabilize to be moderately profitable as it's always been.  The value of the mined coins may increase significantly but that in turn will lead to more miners and a resulting higher difficulty.

[Matthew N. Wright]

Also keep in mind that the network difficulty tends to be directly correlated to the exchange rate.  Right now the few ASIC owners are making an incredible profit while everyone else's mining proceeds are staying somewhat consistent.  Of course the exchange rate changes faster than the network difficulty, but my point is that over time mining will eventually stabilize to be moderately profitable as it's always been.  The value of the mined coins may increase significantly but that in turn will lead to more miners and a resulting higher difficulty.

Yep, snaps like a rubber band in slow motion. Eventually everything returns to normal until someone stretches the rubber band again with a new technology.

[kjj]

what utter bull, mitty

I didn't see a single thing wrong with what he said.

because you're both some brainwashed neoliberal ****

wtf?

[Blinken]

Seriously, stopping people from second guessing other people's earnings is part of what bitcoin is all about.

Who are you to start deciding they "getting too much"? God? You sound like one of the commies at the Fed that wants to shut us down.

And for your information, genius, ALL of coins get produced by mining, so that means the miners receive ALL of the initial capitalization and this is obvious from the paper which maybe you ought to read some more so you understand it. So, if BTC goes up to $1000 and 10 million coins get mined after that, guess how much the miners get? $10 billion dollars, duh (plus the additional transaction fees).

[deathcode]

It would be ok if I had a bigger slice of the pie!   
zif


The only problem I see is that a small number of people are ending up with a majority of the wealth...just as we have in fiat.

Exactly! If the Argentinian government can put their 25% inflation to good use by providing various governmental services, we should insist on miners doing the same! I think it's time for miners to step up and provide multi-signature support so that we can choose who to send our "transaction fee" taxes to!

Mmmm you should really read more about what the argentinean government practices!!!

[d'aniel]

It's obviously way more than enough to prevent double spends.  But the inflation schedule is not debatable, and the exchange rate is not controllable, so go be windbags about something else.

The inflation schedule is not debatable, and the exchange rate is not controllable, but if the amount given to miners is not sustainable then the price will trend downward (or upward if the amount is to low) until it reaches a point that is sustainable. The point of the discussion is to try to figure out what amount is sustainable.

My apologies, I'm sick today and grumpy about it  Wasn't really addressed at you either...

One interesting quantity to look at regarding sustainability of this reward could be the miner reward to exchange volume ratio.  Here it is:


If we say it's exchange volume that sustains the block reward, then this graph suggests we're safe (w.r.t. inflationary downward pressure).  Safer than we've ever been, actually.  But the volume could be fleeting, so who knows.

Edit: cleaned up the graph

[Rygon]

It would be ok if I had a bigger slice of the pie!   
zif


The only problem I see is that a small number of people are ending up with a majority of the wealth...just as we have in fiat.

There is a lot of evidence in any system that most of the wealth is concentrated in a small group of individuals. From what I've seen in a couple studies of the block chain, about 80% of the mined bitcoins are concentrated in 20% of the addresses, 80% of those are then in the top 20% of the 20%, etc. By my estimation, if there were 1 million people involved in bitcoin, the majority would control less than 1 BTC or owe BTC.

Early adopters benefited because they took the largest risk, and there is no way to create "equality" in owning bitcoins without forcibly taking bitcoins from one person and giving them to another. And even if that did happen, some people will always be better at accumulating coins than others, and the same discrepancy in BTC savings would reappear over time.

[Elwar]

The miners are currently being paid an equivalent of about $324000 per day through the block reward. (about 90 USD per BTC, 25 BTC per block, 144 blocks per day)

Do you think this amount is a reasonable amount to keep the network going?

The Federal Reserve is currently pumping $1 billion into the Federal Reserve Note per day. Is this a reasonable amount?

[FreeMoney]

It's a distribution method too. If you think it is more pay than the effort is worth go get your own piece of that free money.

[Matthew N. Wright]

The miners are currently being paid an equivalent of about $324000 per day through the block reward. (about 90 USD per BTC, 25 BTC per block, 144 blocks per day)

Do you think this amount is a reasonable amount to keep the network going?

The Federal Reserve is currently pumping $1 billion into the Federal Reserve Note per day. Is this a reasonable amount?

"Lesser of two evils" argument? Boo. Bitcoin should stand on its own merits, and be defending logically, not emotionally. If there's something wrong with it, fix it or move to something else.

[Peter Lambert]

The miners are currently being paid an equivalent of about $324000 per day through the block reward. (about 90 USD per BTC, 25 BTC per block, 144 blocks per day)

Do you think this amount is a reasonable amount to keep the network going?

The Federal Reserve is currently pumping $1 billion into the Federal Reserve Note per day. Is this a reasonable amount?

No, I do not think what the Federal Reserve is doing is reasonable. How is that relevant to the current discussion?

It's a distribution method too. If you think it is more pay than the effort is worth go get your own piece of that free money.

Good point. But the profits from mining and the revenue for miners are not quite the same thing. If the price remains the same, but 10x the people start mining, then mining would not be profitable but we would still be paying the same $324000 per day to uphold the network (I guess you could also add in the losses of the miners as more money going into upholding the network?).

[Elwar]

Bitcoin is currently in inflationary mode.

The current inflation rate of Bitcoin is around 17%, far beyond what the dollar's inflation is.

And yet it is attacked for its "deflation".

Keynesians should be loving Bitcoin right now.

If nobody new were buying bitcoins, you would be losing 17% of your wealth by keeping your funds in bitcoins.

But new people are buying...at a rate faster than inflation.

[Cryptoman]

My thoughts:

1. Maybe the usd is worth less than we think it is.
2. As FreeMoney said, it is also a distribution method, and all we are really paying is about five cents per transaction (which I imagine will be revised downward soon).
3. Perhaps a good metric to determine if BTC is overvalued is price divided by total BTC exchanged per day.
4. Many people (like me) run a node without mining and without compensation, for the good of the network.
5. We are not in any sort of steady-state equilibrium, and temporary distortions are to be expected.

[Peter Lambert]

Bitcoin is currently in inflationary mode.

The current inflation rate of Bitcoin is around 17%, far beyond what the dollar's inflation is.

And yet it is attacked for its "deflation".

Keynesians should be loving Bitcoin right now.

If nobody new were buying bitcoins, you would be losing 17% of your wealth by keeping your funds in bitcoins.

But new people are buying...at a rate faster than inflation.

Last I checked we were down to about 11% inflation.

Essentially the $324000 going to the miners is how much we are inflating every day.

[Elwar]

Bitcoin is currently in inflationary mode.

The current inflation rate of Bitcoin is around 17%, far beyond what the dollar's inflation is.

And yet it is attacked for its "deflation".

Keynesians should be loving Bitcoin right now.

If nobody new were buying bitcoins, you would be losing 17% of your wealth by keeping your funds in bitcoins.

But new people are buying...at a rate faster than inflation.

Last I checked we were down to about 11% inflation.

Essentially the $324000 going to the miners is how much we are inflating every day.

You are probably right. I just took an old number I found when the reward was 50 and halved it.

[Elwar]

And it is not like the miners are getting paid $324k per day. That would be like saying that a new tech company was paying a million dollars a month to their workers when they are really only paying reasonable salaries along with stock options. Miners are basically being paid stock options. The money traded on the exchanges makes up a fraction of the Bitcoin economy. If everyone were to try to sell their Bitcoins today, we would see nowhere close to $1 billion shelled out.

[marcus_of_augustus]

My thoughts:

1. Maybe the usd is worth less than we think it is.
2. As FreeMoney said, it is also a distribution method, and all we are really paying is about five cents per transaction (which I imagine will be revised downward soon).
3. Perhaps a good metric to determine if BTC is overvalued is price divided by total BTC exchanged per day.
4. Many people (like me) run a node without mining and without compensation, for the good of the network.
5. We are not in any sort of steady-state equilibrium, and temporary distortions are to be expected.

Yep, this ^^^

People need to start thinking in terms of BTC not US$ ... it is messing with your minds.  

Basically, right now the Bitcoin network is producing 3600 btc per day to secure 10.9 million btc ... leave any other flexible, fake measures of value out of the equations and it makes sense.

Last year it was producing 7200 btc to secure up to 10 million btc.

In 4 years time it will be producing 1800 btc per day to secure 15 million btc.

It is an easily described function of time of how many btc the network will be producing to protect the currently existing stock of btc, you could plot it if you like. It has been factored in that the network will need more btc produced to support it earlier in the development phase and less later on. The miners just happen to be the protectors and primary beneficiaries of the coin production so it is easy to conflate those separate functions when trying to decide if the system is "fair".

[b¡tco¡n]

Ok... complain to the central authority that regulates bitcoin.

Or buy an ASIC rig and enjoy  

Believe me this is a lot more fairer than the fiat system, where only a small number of select institutions (banks) can 'mine' (i.e. lend the money into existence for interest). You can be the bank for just 75BTC (from Avalon).