I was told not to feed you, but since you have put so much effort into this, and I don't want newbies to be misinformed, I'm obliged to reply. For those who want to avoid TL;DR, I bolded parts I consider important.
Bitcoin is created at a rate of 25BTC every ten minutes. It doesn't matter what kind of hardware you throw at it, that does not change.
A much larger number of people can go out and use their GPU to mine than the number of people who can purchase and ACTUALLY RECEIVE an ASIC in a timely fashion.
My point was that the overall supply of bitcoins is fixed. It doesn't matter how many people are mining, or how powerful the hardware they use is, the number of bitcoins being brought into the world will not change. And the larger the number of people mine, the less each person will get.
When it becomes more profitable to mine altcoins than bitcoins (which is already the case), your "businesses" will follow the money. And you are probably thinking "they aren't more valuable", to which I would suggest you read on.
Businesses are not in the business of mining coins. They are in the business of selling goods and services, using whatever payment methods are easiest and cheapest. All they care about is how many of their customers and business partners accept the same payment method they do. They don't care if the US Mint bought faster, more efficient money printers, or saved on electric bills by turning off some of the lights and the air conditioning.
Most people did not GIVE A FUCK about smartphones (I had one since 2002). Or e-mail. Or internet. Or hell, even cars at one point. We see the benefits that bitcoin provides. Other people will too eventually.
All of those things provided a way to complete a task that wasn't already in existence via something else. In the case of bitcoin, that something else is called the collective governments of the world and their respective currencies.
People value bitcoin at over $1billion right now, because they believe bitcoins provide something government currencies don't or can't. Perhaps you should figure out what that is.
Almost no one pays with cash any more. Everyone pays with plastic cards or smartphones (the later is rare, but being more adopted). Everyone can use plastic cards and phones to pay with bitcoins eventually, too.
You must not get out much, because cash will ALWAYS be around and will ALWAYS have a place in the economy. People pay with credit cards and debit cards at a higher rate today, absolutely, you are correct in that statement. But they are only using them as an extension of their bank accounts, which is funded by cash or direct deposit from their place of employment (which makes its money from fiat currencies, not bitcoin, and therefore pays in fiat currency). When people need to pay fees and jump through hoops to convert what they already have in cash, to a currency that is wildly unstable, to buy shit they could have just bought in the first place with cash, you would need a very convincing argument for why bitcoins are worth acquiring besides "they're the future bro".
I do get out plenty. Maybe we just live in different types of societies, but where I live, almost no one uses cash any more. It's all credit/debit cards and digital payments.
As for fees, you have to pay those and jump through hoops every time you use your card. You pay those VISA/MasterCard transaction fees, which are typically 2.7%, every time you swipe your card, through increased prices of goods. If bitcoin was used for nothing else but a payment mechanism, you and the merchant would only pay 0.5% to 1% fee, meaning a combines 2 * (0.5% | 1%) = 1% to 2% fee. That alone can save you and the merchant as much at 1.7%, and for businesses where the profit margin is 4%, that could mean almost double the profits.
Does bitcoin provide some sort of inherent utility that nothing else can provide?
Absolutely!
http://www.whyisntbitcoinworthless.com is a good place to start. Besides just the technical, it also provides for a way to store value that does not depend on a whim of any entity, and is not restricted or controlled by anyone, while allowing you to send any amount of it to anyone securely and anonymously. Nothing else does that.
So... how does the number of quality of developers, merchants, and hardware compare between that "new technology" and bitcoin? Are there any ATMs yet? Hardware wallets? Point of sale systems? Easy to use shopping card software plugins? Companies that can accept that "new technology" and deposit it into your account for you? Or do those "new technologies" just provide minor tweaks that don't really give anything new, and have little support because everyone else is using bitcoins?
Reducing the transaction time by over 3/4ths and creating a currency that cannot be taken over by a bunch of glorified paperweights is not a minor tweak, it's a complete overhaul.
How is having to wait ~2.5 minutes for your cup of coffee versus ~10 a major improvement? Both bitcoin and litecoin will require extra trust and the use of a third party to allow for instant transactions. Can you give me an example of when waiting for ~2.5 minutes is better than ~10?
As for being taken over, Litecoin can easily be taken over by botners, government and university supercomputers, or if need be, custom made and built ASICs. Bitcoin
could have been taken over by a malicious entity or government that could send some money to design ASICs in secret, and suddenly overwhelm the network with their own much more powerful mining equipment, but now that ASICs are in private hands distributed among many owners, that scenario is becoming less and less likely.
And for all that stuff you just listed off as if it were commonplace, I see not a one that isn't already being used just fine by fiat currencies. If something isn't broke people will not attempt to fix it, especially if the only outcome is going to be having to spend 50% of the day explaining to the customers what the fuck a Bitcoin even is, let alone how to acquire them.
It doesn't matter that it's not commonplace. It's being developed. And it's not the ATMs and credit cards that are the actual problem, is the
fiat currencies. They are broke. Bitcoin is an attempt to fix the problem. All that stuff I listed just makes it a hell of a lot easier to use them, to the point where people who use bitcoins don't even need to care about what it is, besides "money." From a customer and business perspective, bitcoins will be easily swapped to/from cash, will be easily carried on phones and cards, and can be used to easily accept payments using well established businesses and software.
Litecoin doesn't have any of that yet. It might, but thanks to "network effects" it will likely have as much chance as Bitmint and Bitcoinstore have of taking over eBay and Amazon. Network effect is the main think that will keep bitcoin going despite altcoins, btw.
News flash guys: the words "anonymous" and "mainstream" is already a description of what cash is to society.
Only if you are willing to mail that cash in envelopes or boxes, paying postage, waiting for days for it to get there, hoping no one opens the package and steals it, and having no proof that the person the money being sent to actually received it other than their word.
You know, the guys who can infiltrate and take down those "fancy services" you tout around as the future of Bitcoin while they are mostly based in the US. You cannot challenge the Feds at their own game, and if you think you can then you seriously have something else coming to you.
Bitcoin services are not mostly based in US. MtGox, biggest exchange, is in Japan. Blockchain.info, biggest digital wallet, is based in UK. Bitcoin Wallet for Android, is developed in Germany. Tons of bitcoin services are in Canada, South America, Europe, Russia, and China, and even Iran. The Feds have no control there, and have as much power as the RIAA has over file sharing. How successfull are the feds at shutting down ThePirateBay? The only reason you keep seeing the US based services is because they are they ones catering to you and your US dollars specifically.
Because the only thing that gives Bitcoin value is the places you can spend them at...
Which are becoming more and more numerous as more and more developers create better software and tools to make it easier to use...
...when more and more developers see the writing on the wall and move onto new coins and the current bitcoin services are all in Federal Court or based out of some third world shithole, you can expect a drastically different outlook on the value of them.
Yeah, bullshit. You'll have to show me where you got the idea that "more and more developers are moving onto new coins." Developers want to be involved with something big and widely used, where their time and work will actually be appreciated. Bitcoin is typically the first choice. As for third world shitholes, do you consider Brazil, Russia, or China third world shitholes? Because they could give a shit what the feds want.
Throw in the fact that BitInstant is now checking names through a database and taunting the Feds by being based out of New York (with it's partner being based out of San Francisco), and you got a recipe for disaster that literally gives a giant middle finger to anything Bitcoin was supposed to be.
What BitInstant or any other such service does, has absolutely no impact on the underlying bitcoin system. At all. Sure, I may need to break anonymity to convert government currency to bitcoin, but it's trivially easy to launder those coins through a "mixer," and still use it in private transactions in the same way that bitcoin was intended.
Using names databases to break anonymity isn't a new symptom of bitcoin, it's the old symptom of having to deal with government currencies. As as soon as you're done with the trade, you leave fiat, and all its issues behind.It is solely you Bitheads who won't accept the fact that the high water mark of Bitcoin has already come and passed because the very principles it was founded on are now being brushed aside as unimportant.
What are those principles? The ones I'm aware of are:
1) No inflation - still holding
2) Pseudonomous - still fine (may need mixing if it touched fiat)
3) No regulations or restrictions on payment - still ok
4) No third party or banking risk - still fine, and getting better with hardware wallets
What else am I missing that was brushed aside?
You are pushing out the silent majority that supports Bitcoin by being a bunch of hypocritical dumbasses who think altcoins are useless because they have little vendor support.
It's "have little vendor, user, and developer support." If only because altcoins don't provide anything of substantial value (VHS was inferior to Betamax, but it had vendor, user, and developer support, and wasn't all that much worse). Besides, if someone comes up with an altcoin idea that substantially improves on bitcoin, first, thanks to more developers, it can be easily and quickly implemented in bitcoin too, and second, thanks to more developers, it's much more likely to be created by a bitcoin developer in the first place.
We as a mainstream society are living in the age of convenience, and Bitcoin provides nothing but an inconvenience to all but a group of technical savvy internet dwellers.
And this final sentence right there tells me that you are a newbie when it comes to bitcoin. I never noticed how much of an ENORMOUS PAIN IN THE ASS the current financial system is until I had bitcoin to compare it to.
