Bitcoin will one day be superseded by a technically superior NuCoin. What then?

[JorgeStolfi]

Bitcoin cannot claim eternal divine perfection, so inevitably there will arise a "NuCoin" that has the same nice properties but is technically better in some respect -- and will therefore replace Bitcoin as  the preferred medium of payment for internet commerce.   

What will happen to the Bitcoin then? Owners of course would like to swap them for equal worth of NuCoins.  But who will agree to the swap?

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[Desensitizer]

People are constantly making new cryptocurrencys but the only one that has come close to bitcoins are litecoins. It's unlikely that another cryptocurrency (which is what I assume you mean by something with the same properties) will arise to overthrow bitcoins as they were the first to really get huge and all of the big non-cryptocurrency entities and the media are all focused on them. But Bitcoin needs to first be a competitive form of internet commerce before a new currency could take its place.

[JorgeStolfi]

It's unlikely that another cryptocurrency will arise to overthrow bitcoins as they were the first to really get huge and all of the big non-cryptocurrency entities and the media are all focused on them.

Bitcoin WILL become obsolete one day, like punched cards and floppy disks; whether it is next year or 15 years from now, I do not know.

Litecoin and other crypto-currencies are already being used as means of payment, and the existence or success of Bitcoin does not seem to hamper that; on the contrary they are learly riding on Bitcoin's success.

But Bitcoin needs to first be a competitive form of internet commerce before a new currency could take its place.

I don't see why, but in any case it does not answer the question.  WHEN Bitcoin is superseded by a NuCoin, how will Bitcoin owners swap them for NuCoins?

[Peter R]

Bitcoin WILL become obsolete one day, like punched cards and floppy disks; whether it is next year or 15 years from now, I do not know.

Aren't we still using 80s technology for bank wires?  Haven't we had "dollars" since 1792?

The lifecycle of each new credible monetary system is looooonnnngggg.  Congress passed the Gold Reserve Act on 30 January 1934, nationalizing all the US citizens' gold.  (The next day F. D. Roosevelt changed the value of the dollar from $20.67 to the troy ounce to $35 to the troy ounce.)  We lasted on this monetary system for 37.5 years!  It wasn't until August 15, 1971, that R. Nixon ended convertibility of the dollar to gold.  Our new "unbacked" dollar has lasted 42 more years, bringing us to today.  After excessive money printing and debt accumulation, there is now incredible pressure to adopt a new monetary system!

In 15 years, bitcoin will still be young.  If bitcoin grows to become a dominant currency, it will last for generations.

[deisik]

Aren't we still using 80s technology for bank wires?  Haven't we had "dollars" since 1792?

The lifecycle of each new credible monetary system is looooonnnngggg.  Congress passed the Gold Reserve Act on 30 January 1934, nationalizing all the US citizens' gold.  (The next day F. D. Roosevelt changed the value of the dollar from $20.67 to the troy ounce to $35 to the troy ounce.)  We lasted on this monetary system for 37.5 years!  It wasn't until August 15, 1971, that R. Nixon ended convertibility of the dollar to gold.  Our new "unbacked" dollar has lasted 42 more years, bringing us to today.  After excessive money printing and debt accumulation, there is now incredible pressure to adopt a new monetary system!

In 15 years, bitcoin will still be young.  If bitcoin grows to become a dominant currency, it will last for generations.

Yes, but bitcoin is not legal tender unlike money in the monetary systems you described in your post, so its life may actually turn out to be very short. Why should a government which money system lasted for more than a century give in?

[JorgeStolfi]

Aren't we still using 80s technology for bank wires?  Haven't we had "dollars" since 1792? The lifecycle of each new credible monetary system is looooonnnngggg.

But Bitcoin is not just a brand name, or a network of users; it is a specific computer technology.

It is hard to name a computer technology that has not become obsolete in a few years.  Punched cards, magtapes, floppies, CDs were all "universal" information interchange media that were quickly and completely superseded by better technologies,  Encryption standards are replaced every few years.  IPv4 is being replaced by IPv6, FTP by BitTorrent, and so on.  

Currently it takes over 5 minutes to confirm a Bitcoin transaction.  If a NuCoin transaction could be confirmed in 5 seconds, would it not become more attractive than Bitcoin?

So one must at least admit the possibility of Bitcoin being superseded by some other system in the medium term.  What would happen then?

[Ibian]

Activity: 6

[Peter R]

Aren't we still using 80s technology for bank wires?  Haven't we had "dollars" since 1792?

The lifecycle of each new credible monetary system is looooonnnngggg.  Congress passed the Gold Reserve Act on 30 January 1934, nationalizing all the US citizens' gold.  (The next day F. D. Roosevelt changed the value of the dollar from $20.67 to the troy ounce to $35 to the troy ounce.)  We lasted on this monetary system for 37.5 years!  It wasn't until August 15, 1971, that R. Nixon ended convertibility of the dollar to gold.  Our new "unbacked" dollar has lasted 42 more years, bringing us to today.  After excessive money printing and debt accumulation, there is now incredible pressure to adopt a new monetary system!

In 15 years, bitcoin will still be young.  If bitcoin grows to become a dominant currency, it will last for generations.

Yes, but bitcoin is not legal tender unlike money in the monetary systems you described in your post, so its life may actually turn out to be very short.

Or its life may actually turn out to be very long.  Gold was around before the phrase "legal tender" had meaning.  How long has mankind used gold?

[hiltonizer]

I agree OP. Those claiming that current altcoins not gaining substantial tracking are missing the part that none of them are a radical improvement in any way.

Standards evolve, and when they do old standards depreciate. No idea when it will happen, but my guess is Bitcoin will slowly decrease in value as the NuCoin increases in popularity. I don't ever see it going away overnight, it will be just another technology shift.

Bitcoins first-to-market network effect certianly buys it a lot of time, and the longer its the defacto standard the more impressive the NuCoin will have to be.

[jambola2]

Yeah , seems about right that bitcoin will be superseded , but not any time soon.
There are coins with a 30 second block time instead of the 600 seconds of Bitcoin , but they do not seem to obtain popularity.
Bitcoin is still growing and seems that it will be superseded , only long after its growth is over and it becomes a dominant currency.
Don't hold your breath waiting.

Activity: 6

So ?
Many people join just to make a specific post on the forums and are aware of bitcoin and its workings before joining the forums.
This may be of concern if he was asking for you to trust him with your BTC or so.

[Peter R]

But Bitcoin is not just a brand name, or a network of users; it is a specific computer technology.

It is hard to name a computer technology that has not become obsolete in a few years.  Punched cards, magtapes, floppies, CDs were all "universal" information interchange media that were quickly and completely superseded by better technologies,  Encryption standards are replaced every few years.  IPv4 is being replaced by IPv6, FTP by BitTorrent, and so on.  

Bitcoin is more than a computer technology.  It is a rapidly-growing network that guards a shared transactions ledger.  It can adapt as needed, and it obeys strict mathematical rules.  

The core bitcoin protocol is more "mathematical" than "computer technology."  Concepts from mathematics are deep and far-reaching.  For instance, the mathematics for X-ray computed tomography (CT) were discovered in 1917 by the Austrian mathematician Johann Radon.  We still use this today because it works.  The core bitcoin mathematics will be robust for the foreseeable future.  

Sure it's *possible* that someone breaks SHA256 and ECDSA, but it is also *possible* that someone finds a way to cheaply fuse lighter elements into gold.  I think both have the same probability: essentially nil.  

Currently it takes over 5 minutes to confirm a Bitcoin transaction.  If a NuCoin transaction could be confirmed in 5 seconds, would it not become more attractive than Bitcoin?

Confirmation times are not a problem, I think people misunderstand how bitcoin works.  Here in Vancouver, several brick-and-mortar businesses accept bitcoin payments via BitPay.  It is standard practice for the vendor to consider the invoice paid as soon as the transaction is picked up by the network (typically within a fraction of a second).  The only way to attempt a "double spend" at a brick-and-mortar is to have a custom "double spend" app for your phone.  And if you actually attempt to double spend, the network sees both transactions and it is obvious that you've double-spent and the invoice will not be considered paid.  You'll also look like a thief in front of everybody in the store.  If you "double spend" 3 minutes after leaving the store, your fraudulent transaction would not make it into a block.  

You can actually test this by creating raw transactions at brainwallet.org.  Create two different raw transactions using the same coins.  Send the second transaction 3 minutes after the first, and it will be the first transaction that makes it into a block.

So one must at least admit the possibility of Bitcoin being superseded by some other system in the medium term.  What would happen then?

This is highly-unlikely except over the long term.  But if it did happen, bitcoin would adopt the necessary changes.  There is great value in the blockchain; it will be protected.
 

[deisik]

Yes, but bitcoin is not legal tender unlike money in the monetary systems you described in your post, so its life may actually turn out to be very short.

Or its life may actually turn out to be very long.  Gold was around before the phrase "legal tender" had meaning.  How long has mankind used gold?

Very long, since ancient times indeed. But gold has qualities that are valued by most people throughout the world. Does bitcoin have that level of appeal, glamor and magnetism that would attract to it as many people even without being a legal tender?

[Peter R]

Yes, but bitcoin is not legal tender unlike money in the monetary systems you described in your post, so its life may actually turn out to be very short.

Or its life may actually turn out to be very long.  Gold was around before the phrase "legal tender" had meaning.  How long has mankind used gold?

Very long, since ancient times indeed. But gold has qualities that are valued by most people throughout the world. Does bitcoin have that level of appeal, glamor and magnetism that would attract to it as many people even without being a legal tender?

We will find out in our lifetimes. 

[maxxoccupancy]

It shouldn't be any surprise that the two most highly capitalized altcoins (Bitcoin and Litecoin) have both developed entirely from the community itself with no premine and a wide opportunity for the average computer user to enter.

If some "NuCoin" is going to overtake either one, I believe that it will have to do so with a very long nearly-free period of widespread mining by true believers.  Even making use of all of the new technology for improving performance, security, and efficiency, a competitor must be an order of magnitude better in one way, or noticeably better in several ways.

For my part, I've been working on built in mechanisms to reduce the volatility and uncertainty in a new altcoin.  Even with that improvement, it would be difficult to get the new currency established.

[pjviitas]

Bitcoin will be eclipsed one day by a different form of currency I can guarantee that...its just a matter of when.

[Shneebly]

Bitcoin cannot claim eternal divine perfection, so inevitably there will arise a "NuCoin" that has the same nice properties but is technically better in some respect -- and will therefore replace Bitcoin as  the preferred medium of payment for internet commerce.   

What will happen to the Bitcoin then? Owners of course would like to swap them for equal worth of NuCoins.  But who will agree to the swap?

I'm sure there are dozens of forums superior to Craigslist from a technical perspective. Yet Craigslist is the website with the 11th greatest traffic in the US, so it remains on top. Craigslist is a stupidly simple website... yet it has lots of traffic, and that perpetuates it's popularity. Furthermore, Craigslist's users are not financially bound to support it-- anyone who owns a significant amount of Bitcoin is.

Of course Bitcoin cannot claim "divine perfection," but it does have a first to market advantage. And given the type of painful transition a major switch would be, there would have to be a far superior replacement currency.

I'm curious (no sarcasm intended):

What new, superior quality will this new money have?

Note: I believe the "swap" you speak of would dictate a centralized authority (automatically making the new currency inferior), unless it was built off the existing Bitcoin blockchain.

Great post Peter R.

[Pente]

There is also the possibility of jump starting nucoin by importing unspent btc from the bitcoin blockchain. So nucoin wouldn't necessarily destroy bitcoin. It might be more like moving from ounces of gold to grams of gold. Everyone would still keep the value of their money.

Even if the designers of nucoin didn't like this idea, it still might happen. The people with a big investment in Bitcoin could just create an alt of nucoin using the cool new algorithm that gives nucoin it's advantage. But they would also incorporate the btc blockchain in this nucoin 2.0, maybe even allowing you to create nucoin2.0 coins by sending btc to an unspendable address with a message that includes your nucoin2.0 address.

The point being: Any new algorithm can be either added to the bitcoin protocol or, in worst case, will probably allow bitcoins to be migrated to the new protocol.

[Peter R]

There is also the possibility of jump starting nucoin by importing unspent btc from the bitcoin blockchain. So nucoin wouldn't necessarily destroy bitcoin. It might be more like moving from ounces of gold to grams of gold. Everyone would still keep the value of their money.

Even if the designers of nucoin didn't like this idea, it still might happen. The people with a big investment in Bitcoin could just create an alt of nucoin using the cool new algorithm that gives nucoin it's advantage. But they would also incorporate the btc blockchain in this nucoin 2.0, maybe even allowing you to create nucoin2.0 coins by sending btc to an unspendable address with a message that includes your nucoin2.0 address.

The point being: Any new algorithm can be either added to the bitcoin protocol or, in worst case, allow bitcoins to be migrated to the new protocol.

+0.5

TL/DR: The blockchain will be preserved.

[maxxoccupancy]

To be far superior, a currency would only need to have a feature that stopped the sudden drops that make holding on to it over the long haul such a scary prospect.  Long haul holding is exactly what's needed for a high market cap.

In most cases, Bitcoin can, with near unanimous support, implement a change that is proven effective by some new altcoin.  That is, in fact, one of the reasons that altcoins are so interesting to many Bitcoiners.

[Peter R]

To be far superior, a currency would only need to have a feature that stopped the sudden drops that make holding on to it over the long haul such a scary prospect.

Can this new alt-coin also vacuum my floors and cook me dinner?  That would make it the superiorest.  

Sorry, just having fun with you  .  But, isn't this impossible?  You either legislate its value by fiat (and live with the problems of fiat money) or you let the free-market figure it out (with a series of booms and busts).  

If we all *know* the value will just go up and can't come down, then we'd all throw everything we have into it right?  Then we'd have one big super bubble!