Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

[KFR]

Is the 21 million BTC cap good for them?

Any miners that don't like it can mine blocks for a different chain.  Nobody will follow them - I thought we covered this yesterday.

No, you assumed that some "bad" miners would try do that in order to destroy bitcoin or whatever, and claimed that the "good" miners would not let them do that.  I am asking about your "good" miners.  is the 21 M BTC limit good for them?

Yes.  Yes it is. 

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[freebit13]

Is the 21 million BTC cap good for them?

Any miners that don't like it can mine blocks for a different chain.  Nobody will follow them - I thought we covered this yesterday.

No, you assumed that some "bad" miners would try do that in order to destroy bitcoin or whatever, and claimed that the "good" miners would not let them do that.  I am asking about your "good" miners.  is the 21 M BTC limit good for them?

Isn't that exactly what makes the currency deflationary?

[adamstgBit]

well that settles that

[KFR]

Only until he brings it up again in a few weeks.

[ChartBuddy]

Explanation

[fonzie]

http://imgur.com/a/MR5Mf

Game over?



btw: i don´t speak chinese 

[fonzie]

In a few months we will have some kinda pawlov´s dog effect.
As soon as chinese symbols appear anywhere everyone panic sells immediately.

[Einewton]

fonzie FUD... It's all over?

[aminorex]

Mining will work until defection becomes the dominant strategy.  At that point, we need alternatives pre-positioned, because when it happens, it will happen very quickly.  But not for a few years yet, anyhow.

[fonzie]

fonzie FUD... It's all over?

我愛BTC。
但現在更好的恐慌性殺跌

[adamstgBit]

omg such fud

want to delete....

[fonzie]

omg such fud

want to delete....

No bad feelings if you do, but we really could be onto something, it´s CHINESE can´t you see

[adamstgBit]

omg such fud

want to delete....

No bad feelings if you do, but we really could be onto something, it´s CHINESE can´t you see

did china ban bitcoin again?

[JimmyJazz]

where can i cash out large btc holdings with high withdrawal limit??

[fonzie]

where can i cash out large btc holdings with high withdrawal limit??

Bitstamp is ulimited after some intimidating KYC questions as far as i know?

[JorgeStolfi]

Not quite. Miners will do whatever gives more benefit to themselves.  Is the 21 million BTC cap good for them?

Yes, it is.  Without it, their BTC would become worthless.

Would it?

Let's suppose, just for argument, that the majority of the miners decided to raise the cap to 210 million BTC, and lower the difficulty so that mining became 10 times more productive in BTC terms.  What would happen?

Note that the total supply of bitcoins would not immediately increase, there would still be only 12 million BTC "in existence".  The flow of mined bitcoins would increase by some factor, but it would still be years before the remaining 9 million "old" BTC are mined and the "new" bitcoins start to be broken into.  The market value of bitcoin may drop somewhat, because of the loss of the "scarcity" aura (which was lost anyway when the altcoins sprung up); but it may also go up, because the future viability of mining would look less uncertain.  The utility of bitcoin as a medium of payment would not be affected (except perhaps momentarily by the change in market price); on the contrary, bitcoins would eventually be more evenly distributed, and a larger slice of the pie would go to those who are actually making bitcoin work.  And the increased "inflation" rate due to higher mining output would discourage hoarding.

Miners who chose to remain faithful to the "classical" protocol, with its cap and difficulty, would be making 1/10 of what their colleagues are doing; and will lose all their output if they fork and the other chain prevails.  Why would they do it?

You seem to be assuming that all miners are hoarders.  But they already must sell a large fraction of the BTC they mine in order to pay their energy bills and other expenses.  Many miners probably sell all their production, in order to have the profit in cash now rather than hope for the hypothetical future when one bitcoin may be worth a zillion dollars.  These miners do not care if the present BTC owners will own only 5% of all the money in that fantastic future, instead of 50% of it.

Note, I am not saying that this will happen, that its is likely to happen, or even that it would work in exactly those terms.  I am only pointing out that miners' greed (or simply their need to make ends meet) may well destroy bitcoin's supposed scarcity, rather than protect it.

[donut]

>Let's suppose, just for argument, that the majority of the miners decided to raise the cap to 210 million BTC, and lower the difficulty so that mining became 10 times more productive in BTC terms.  What would happen?

The clients will rejects the blocks mined by these miners and everything goes on as normal, same as if the miners participating in the coup started mining PPC.

You are forgetting that miners aren't the only part of the network which keeps everyone in check.

Even if you have 90% of network hasharate, you can't change the rules at will. The only thing you *can* do is choose which transactions are recorded by never building on top of blocks containing unwanted transactions.

[fonzie]

where can i cash out large btc holdings with high withdrawal limit??

Bitstamp is ulimited after some intimidating KYC questions as far as i know?

Of course only if you don´t want to sell 100k at once?
Do you?
Maybe?

[raid_n]

Let's suppose, just for argument, that the majority of the miners decided to raise the cap to 210 million BTC, and lower the difficulty so that mining became 10 times more productive in BTC terms.  What would happen?

Note that the total supply of bitcoins would not immediately increase, there would still be only 12 million BTC "in existence".  The flow of mined bitcoins would increase by some factor, but it would still be years before the remaining 9 million "old" BTC are mined and the "new" bitcoins start to be broken into.  The market value of bitcoin may drop somewhat, because of the loss of the "scarcity" aura (which was lost anyway when the altcoins sprung up); but it may also go up, because the future viability of mining would look less uncertain.  The utility of bitcoin as a medium of payment would not be affected (except perhaps momentarily by the change in market price); on the contrary, bitcoins would eventually be more evenly distributed, and a larger slice of the pie would go to those who are actually making bitcoin work.  And the increased "inflation" rate due to higher mining output would discourage hoarding.

Miners who chose to remain faithful to the "classical" protocol, with its cap and difficulty, would be making 1/10 of what their colleagues are doing; and will lose all their output if they fork and the other chain prevails.  Why would they do it?

You seem to be assuming that all miners are hoarders.  But they already must sell a large fraction of the BTC they mine in order to pay their energy bills and other expenses.  Many miners probably sell all their production, in order to have the profit in cash now rather than hope for the hypothetical future when one bitcoin may be worth a zillion dollars.  These miners do not care if the present BTC owners will own only 5% of all the money in that fantastic future, instead of 50% of it.

Note, I am not saying that this will happen, that its is likely to happen, or even that it would work in exactly those terms.  I am only pointing out that miners' greed (or simply their need to make ends meet) may well destroy bitcoin's supposed scarcity, rather than protect it.

Ultimately it makes no difference at all if the supply is fixed or not as long as miners get the transaction fees from mined blocks as a reward once the cap is reached. All you are really doing is changing the denomination. Proof of Work in the form that is being used will raise/lower difficulty in accordance to the computational power being thrown at the network. What difference does it make if you mine 50, 500 or 5million coins in one block or merely receive the fees?
The price will converge to what the market thinks it should be.

[edit] to clarify this. miners will mine if it is profitable to mine, even if it is just for the transaction fees

[seleme]

Forget arrows. On the bottom of this long 3d linear regression channel. We haven't been there for a long, long time.