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March 07, 2014, 12:12:00 AM |
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I know that altcoins are currently far more profitable to mine than BTC.
However, I was wondering whether there is a true reason for this, or whether it's just a speculative bubble.
There are 3 advantages I could come up with for altcoins:
1. Faster transaction time-- seeing as cryptocurrencies are volatile, if you were selling real world goods, the faster you can get it into fiat, the better, and so, faster transaction time could give altcoins a legitimate benefit over BTC.
2. Adding capacity-- if BTC ever got so huge that 8 decimal places is not enough, altcoins would provide extra capacity. However, this is a silly point, because BTC would have to get into the trillions of USD for this to be true. Not only that, but according to bitcoin.org, the BTC developers could add more decmial places if they had to.
3. GPUs are in better supply than ASICs. Because all computers need GPUs to show you a GUI, and because gamers like GPUs, there is a proper supply of GPUs. ASICs are in smaller supply. And thus, it becomes highly expensive to even maintain the BTC network, thus making altcoin mining cheaper to maintain.
In economics, value is created through demand-supply, and if it's incredbly easy to create an altcoin, how can it possibly have a true value?
What does everyone think? Is there any true value of altcoins, or it a joke?
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