It’s like when people used to say that Twitter was just one feature of Facebook, the status update.
Products that appear superficially similar early on develop shared cultures and use-cases and differentiate over time. So too for coins.
Conversation
Immutability (BTC) and financial innovation (ETH) are both incredibly valuable, but by their very nature can’t be the same thing.
A constantly changing and improving platform (Ethereum) is culturally different from a finished, reliable, immutable coin (Bitcoin).
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If Ethereum isn’t reliable, then it’s idiotic to put the future of finance on it, no?
So in the end, Ethereum is reliable and in the worst case scenario you can put an immutable-supply token on it.
Also, Bitcoin will have to break 21M or make major protocol changes in the end.
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Why does btc need to break 21M?
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Because without the block subsidy it will not be secure enough to ensure a hash rate that can support large transactions without risk of a double spend.
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This does seem true to me, and I’d be interested to understand the best arguments to the contrary.
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Last 3 blocks fee (681532-4): 1.471 BTC, 0.737 BTC, 0.517 BTC. With increase in use of L2 technologies, transaction fees have still some room to grow.
2 BTC/block = ca 75kBTC p.a. = 4.5 bnUSD @ 60kUSD/BTC => ~ 36 bnUSD p.a. @ gold mcap. Not enough?
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If there’s truly enough volume for BTC to hit gold mcap, then no, I don’t see how that could be enough to secure the chain: gold’s trading volume is more than five times that *per day*! Am I missing something?
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A few points to that:
(i) your attack is double-spend, so you are limited to largest anonymous transaction (otherwise there is recourse), i.e. total volume is not so relevant
(ii) your defense is number of confirmations, so counterparty has to fail risk management
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(iii) to execute a successful doublespend, you will need a lot of hardware - there will be supply chain limitations and significant capital costs linked to that; also ASIC/chip producers will likely know who you are => possible recourse
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It seems that to maintain the conditions you describe in the face of low rewards, wait times must increase, potentially without bound. The argument starting page 12 of this paper seems to describe the dynamics well: bis.org/publ/work765.p
Your point about hardware is interesting and I’m not sure how to model it. But mining seems sufficiently semicentralized that an attacker may not need to control the hardware themselves if they can sufficiently incentivize the miners.
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I think logistics of such attack are a key point. You would need effectively state capacity attacker (or key supplier), in order to what..? to rip off exchange, customer or supplier (or destroy own business)?
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I agree that there might be such limitation for extremely large transactions. However, these are usually not limited to economic finality and can rely on legal recourse too as parties usually know each other (e.g. M&A, super large orders, some corporate/state financing).