Bitcoin will one day be known as 'the grandaddy of them all' just like the Rose Bowl. Bitcoin suffers from centralization, the very thing it was designed to circumvent The Bitcoin cultist are emotionally wrapped up with the idea that it has to be everything for everyone. Money has a way of making us emotional.
Bitcoin has to be a payment machine for payment processors, It has to be a store of wealth for investors, It has to be a currency for libertarians. It is so caught up in trying to be everything that it does none well. Bitcoin developers dont be afraid to go your own way. They should branch out into new areas and create new coins, applications and opportunities. Why does it have to be Bitcoin or bust. Proponents attack new ideas. They wake up at night in terror that something new might emerge that meet needs in better ways. What would the Stockmarket be like if there was but one issue to trade. It is no wonder that Bitcoin companies struggle to make money. The market is being restrained from growing by those that seek to control the golden goose and make certain that there is no other options. Yes, new things are coming and new financial markets will come into being whether Bitcoin changes its protocol or not. Centralization leads to waste fraud and abuse even with the best of intentions Bitcoin
There is great debate and concern about Bitcoin trying to change its core software. Network tests have found the credit card processor can process many more transaction per second than Bitcoin can. Some influential leaders want to make changes that will make the protocol more competitive with VISA/MASTERCARD. They want to change increase amount of transaction processed in each block (the block in blockchain technology). The important issue is not about changing Blockchain size it is about changing the hard coded rules that are the foundations for trust in Blockchain based systems. What is there to stop future forks that change other rules that users relied upon in their choice to participate in this financial system. Lets say some economic interests in the future lobby the influential core developers and miners to change the amount of coins mined in the future to let say 100 million. If the users rely on the software to enforce it rules any important changes to the rules that are significant can effect the end users in unpredictable ways. The users of Bitcoin have no say. Once again a small group is making choices and if they are wrong they can destroy the entire system. A system that relies on influential few promoting there own economic interest is no better than a public company issuing out more shares when they see the need or the government printing more currency. Those who want to take Bitcoin into direct competition with VISA/MasterCard should simply create a new coin designed to do this. There is so much more to the potential of the protocol than just a cheaper way to spend money. The principal of hard coded rules they can not be changed and are enforced by the software is one of the true revolutionary idea’s of Bitcoin. There is more at stake than creating competition for banks. Its about staying true to a financial system rules that users chose to participate in.
The Bitcoin system analogy is like a closed silo of wheat. All wheat (fiat currency ) is blown to the top of the silo where the value is stored until it is needed to be converted back into fiat currency again.
At the bottom on a equal basis Bitcoin purchasers and miners go to the market when they desire convert back into fiat currency to pay required taxes and or expenses that can only be done in fiat currency. The volatility in price is a added incentive for those using Bitcoin as a payment system to convert back to Fiat currency thus reducing the stored value.
Miners contribution (processing power and electricity) occur outside the silo (this is there basis of claim and conversion to fiat currency to pay the operating bills).
The miners do not increase the amount of wheat (fiat currency ) in the silo system.
Bitcoins by there simple function produce no new income or growth either inside or outside the silo that increases the stored value of wheat (capital) in the silo.
So any distribution to miners reduces the amount of wheat (stored capital ) by almost 40% which is dilutive to those who paid full price to buy Bitcoin.
Tommorow if the market price of Bitcoin increase more wheat is added to silo. This is just borrowing against the future stored value.
If enough Bitcoin is exchanged for the stored value in the silo (fiat currency) then the market price will drop to reflect this inequality.
Mining bitcoin is a dilutive to the value paid by those who buy Bitcoin in the free market by those who receive coins for mining. lets do some simple math based upon today statistics. Todays volume 6297.55 x Avg price 247.6 =
$1,559,273.38 minus (3,800 coins mined x 247.6 = 618,393.38)
98.1958666466. This means if you bought Bitcoin today your value has been diluted by more than 39%. So each Bitcoin has only $149.40 in fiat currency available today.
So Bitcoin 2.0 applications that grow capital is the only long term solution to this problem.
From my prospective Soylent does not taste like anything because it has never been shipped to me after receiving one notice of delay after another. I bought a week supply on Kickstarter nothing ever arrived after what seems to be a close to a year. They have missed multiple delivery time frames. I have since bought some competing products (Phood) while I waited and still wait.
From my prospective Soylent does not taste like anything because it has never been shipped to me after receiving one notice of delay after another. I bought a week supply on Kickstarter nothing ever arrived after what seems to be a close to a year. They have missed multiple delivery time frames. I have since bought some competing products (Phood) while I waited and still wait.