Man you people are so dense it's like you refuse to acknowledge the arguments made in most of my previous posts and insist on your incomprehension of the whole dynamics at stake to justify your ignorance.
Let us do it then step by step so you understand where you mistakes are
Bitcoin the currency is a mental bridge to understanding money as memory. The blockchain is the money. The blockchains existence is dependent on the economic incentive to wright transactions to it, it is an economic ledger if you adopt it. (Adopting Bitcoin is agreeing with the utility that it is the ledger.)
Agreed.
When rewards drop to a low quantity, possibly 20 months from now more likely 6 years, transaction fees will be a significant portion of the incentive to mine blocks. The network is dependent on incentivizing miners - to write transactions. In this model there is no wasted hashing, hashing grows to a point where it is supported by the value it provides eventually it grows to the marginal cost of transactions fees necessary to secure the network. The drop in reward forces efficiency. And competition to mine for fees is incentivized by accepting the lowest fees possible. The mining market will tend to maximize profit by accepting the lowest fees that are viable or competition will get a sustaining advantage.
Messing with this has ramifications it changes the core of Bitcoin.
It really doesn't matter what miners think so long as they are at least 2 and they are in competition to write to the ledger in exchange for value that is redeemable in that ledger. The economic incentives, the value in the network, will ensure the appropriate industrial energy is invested.
This all sounds good to me... except maybe your inference that Sidechains "mess with this". moving on...
SC offer a secure way to use your BTC (Bitcoin the currency) but they don't secure the value, SC give me a choice transfer the value into another chain if it has greater value, and exchange it back if the other chain has less value.
Mistake 1 : Sidechains can protect the value through merged mining.
Mistake 2 : A chain that has greater value than Bitcoin = an alt-coin with greater value than Bitcoin. Utility features/services annexed to the main blockchain DO NOT have greater value than Bitcoin, only an alt-coin (supported through a sidechain or not) can claim this. If that is what you are suggesting (altcoin taking over) Sidechains are NOT introducing this risk and do little to enable it. As smooth has pointed out, the creator of such an altcoin would realize it is not necessarily desirable for his coin to utilize a sidechain.
I only believe BTC has a value because the only way in and out is by moving economic energy to the blockchain, Bitcoin in my mind is the blockchain and the currency are inseparable. It is just money is memory, value on the blockchain.
Mistake 3 : Assuming the transfer of scBTC does not generate, by proxy, the movement of economic energy to the main blockchain.
SC obviously have to be innovative (cypher' arguments have largely IMO focused on how you can fake success by messing with price.) But assuming they offer better value fake or real BTC will lock in. The BTC stay there but the value expressed as economic energy moves across.
See
Mistake 2 :.
To secure this value it will need to be mined, MM is the only option as the value will be comparable to that of Bitcoin.
The miners will mine where ever the value is. If the SC becomes more valuable than Bitcoin (note the value can come from speculation manipulation or innovation we don't get a choice) then miners will derive there reward from the chain that gives the most incentives, nothing guarantees it will be Bitcoin.
See
Mistake 2 :.
We also know Bitcoin will be disadvantaged over time with it's diminishing reward, and if the value is in a SC it will derive the highest reward from transaction fees. (The most viable argument I've heard is miners just MM all the SC, and I don't think that is a secure stratergy.) SC's could be anything even have an inflation rate however improbable that is it's not impossible, and not unlikely. I conclude that miners will treat the value chain as the main chain and the Bitcoin blockchain would become less secure as miners don't have an economic incentive to keep it secure. (They earn off another chain)
Refer to
Mistake 2 :. Note also that "I don't think that is a secure strategy" is not a reasonable answer to the argument you have been presented.
FACT : it is trivial for miners to merge mine just about any chain and they will if there is ANY value in it.
Given we don't know who how or what SC will prevail we can probably expect a greater variety than we see with Alts as there are fiewer risks, we know if they fail to become the value chain they lose nothng and everything to gain if they succeeded.
No different than creating altcoins.
SC represent an attack vector fare more viable than a 51% attack, I for one wouldn't want to get 1:1 BTC back if the SC had more liquidity and a bigger network. And if that happened Bitcoin would not be as viable for me.
Refer to
Mistake 2 :I am convinced Bitcoin has no place being the dominant money or Master Chain unless it represent the economic memory or the greatest liquidity, SC change that, one may emerge that is adopted for reasons that appeal to non Austrian ideals, and absorbs Bitcoins value
Mistake 4 : Failure to understand that sidechains can preserve the ledger AND allow for more features to the unit in the ledger.
Austin Hill : "The KEY idea here is to protect the concept of digital scarcity and 21 million Bitcoin limit"
This is also a reiteration of your GOVcoin wins scenario which is truly a disturbing though coming from a Bitcoin proponent. See
Mistake 2 :
Poll
