Do you really think people will pay (inflation adjusted) 1000 USD, 10000 USD, etc. for a single Bitcoin transaction?
If electricity wasn't so heavily subsidized where most mining happens, there would be far less already. Mining scales up/down to what block rewards + fees fund.
Conversation
10x more mining or 1/10 as much mining wouldn't change the throughput. Mining difficulty adjusts to keep it the same.
It's the security factor for choosing the valid path of blocks (security against double spends / disruption). Every node enforces the other rules themselves.
1
4
Replying to
The fees don't determine the trust people put in bitcoin, the scarcity multiplied with adoption rate does. There are only 21 million bitcoin and of which 18 million plus distributed and quite a few lost for ever. Get yours when still cheap.
1
Replying to
The fees combined with the decreasing block rewards determine the total revenue split amongst the miners. It's the amount of money put into securing the network against double spends and disruption via the PoW security level. That part of the security will become based on fees.
1
Replying to
The fees are balanced between layer2 solutions and the biweekly difficulty adjustment. It's the limited money supply times adoption rate that determines the value people will put in the first true proof of work asset class you can memorize the key of. It will eat all others.
1
When mining (fees + reward lottery) finally becomes fees only, nothing really changes. The mining reward naturally converges towards energy cost plus hardware write offs plus a bit for the effort and risk.
1
Replying to
I didn't say anything changes just that I don't understand the expectation of massive growth in mining revenue. The amount of revenue for mining will be tied to the total fees being paid. Block rewards just haven't gone down as fast as price has gone up yet at this early point.
1
Replying to
You are not wrong, but the mining revenue is not perse correlated to, and simply dwarfed by, the utility value of bitcoin as ultimate distributed digital store of wealth. It's truly what people assumed gold would be.
1
Actually it is the most energy economical function complete distributed store of value system ever invented by mankind. Without proof if work it would become fiat money again. See also
1
As soon as you wrap your mind around the fact we are actually talking about a new asset class of satoshi's or sats with build in scarcity, you will want to get some of your own. With 100.000.000 sats per bitcoin x 21m, we are still very early with cost about 0,35 $ per kilosat.
1
Bitcoin as a "store of wealth" doesn't interest me.
Decentralized, private financial services (primarily payments) not requiring approval from people in power are what interests me and my interest in Bitcoin is based on how well it ends up providing that.
Sure, number goes up. Not what I consider success. Success is replacing credit cards, banks, etc.
Bitcoin's on-chain privacy is atrocious and it's not making much progress. Mining is heavily centralized, people heavily use centralized custodial wallets/services, nodes, etc.
1
I have a lot of money stored as Bitcoin while figuring out how to get it turned into useful progress. It benefits me if the price goes up, since I can get more done. It hurts if the price goes down.
Price isn't what makes it compelling or not. Price follows from that if it is.
1
Show replies