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I believe this argument is plainly wrong. In this post I will explain why I think it fails even if the core premise — that fee-driven security might not be sufficient — is a reasonable concern to hold. Lastly, I will explain why I believe that Bitcoiners have nothing to fear, regardless of whether fees are ultimately deemed to be sufficient or not.
I believe this argument is plainly wrong. In this post I will explain why I think it fails even if the core premise — that fee-driven security might not be sufficient — is a reasonable concern to hold. Lastly, I will explain why I believe that Bitcoiners have nothing to fear, regardless of whether fees are ultimately deemed to be sufficient or not.
>"There’s a popular view within the non-Bitcoin crypto industry that the more educated Bitcoiners are at best naive, or at worst completely in denial on the topic of Bitcoin’s long-term supply. Put…"
>"There’s a popular view within the non-Bitcoin crypto industry that the more educated Bitcoiners are at best naive, or at worst completely in denial on the topic of Bitcoin’s long-term supply. Put…"
Thanks [@soemoekyaw](/user/profile/soemoekyaw) for putting this up. Its a article by Coinmetrics and "Crytpotwitters" Nic Carter. It attempts to discuss the perennial concerns over how does bitcoin fund its security once the block subsidies (Coins awarded to miners) decrease over subsequent halvenings and eventually disappear in 2140 (IIRC.) Firstly he did skirt round the main concern of whether transaction fees will be able to supplant the block subsidy in the future by saying he was not going to try and discuss what transaction fees will look like in the future (will they be enough basically), but he did indicate that he thought they would be. Its probably a good issue to skirt around as it is too hard to predict what transactions fees will look like. Currently transaction fees are set up to run at high levels whenever transaction levels are high, and this is in the form of the block size limit; with the theory a smaller block size limit keeps the total chain size low(er) so everyday users can run nodes to verify. Its also pretty useful as reducing spam transactions/flood attacks as well imo. I personally would be very surprised that with the deflationary nature of computer parts and data if these block size isn't increased at some point, but I'm certainly not an expert on this and could not say whether it would be a meaningful increase. If the block size stays the same then we have to accept Bitcoin is planning for high transaction fees in the future. Although this restricts its use as a every day currency for regular commerce there is nothing to say that people who are running services on the chain will not pay them, such as opening a lightning channel for others to us or some other form of layer 2 service, or even "Bitcoin Banks" who are happy to pay high fees to move large amounts of currency around. Funnily enough even Hal Finney discussed the concept of Bitcoin Banks. I did like his idea that even if transaction fees are not enough to maintain security then something will be built that will be linked to the distribution of bitcoins in order to protect the fair distribution of these and I suspect that would be a more acceptable approach if needed. Honestly though, I think Bitcoins hard cap will never change as if its changed once then the thought will be that it can always be changed again, and thus the cap looses any true meaning. Overall a thoughtful article and worth a read.
Thanks [@soemoekyaw](/user/profile/soemoekyaw) for putting this up. Its a article by Coinmetrics and "Crytpotwitters" Nic Carter. It attempts to discuss the perennial concerns over how does bitcoin fund its security once the block subsidies (Coins awarded to miners) decrease over subsequent halvenings and eventually disappear in 2140 (IIRC.) Firstly he did skirt round the main concern of whether transaction fees will be able to supplant the block subsidy in the future by saying he was not going to try and discuss what transaction fees will look like in the future (will they be enough basically), but he did indicate that he thought they would be. Its probably a good issue to skirt around as it is too hard to predict what transactions fees will look like. Currently transaction fees are set up to run at high levels whenever transaction levels are high, and this is in the form of the block size limit; with the theory a smaller block size limit keeps the total chain size low(er) so everyday users can run nodes to verify. Its also pretty useful as reducing spam transactions/flood attacks as well imo. I personally would be very surprised that with the deflationary nature of computer parts and data if these block size isn't increased at some point, but I'm certainly not an expert on this and could not say whether it would be a meaningful increase. If the block size stays the same then we have to accept Bitcoin is planning for high transaction fees in the future. Although this restricts its use as a every day currency for regular commerce there is nothing to say that people who are running services on the chain will not pay them, such as opening a lightning channel for others to us or some other form of layer 2 service, or even "Bitcoin Banks" who are happy to pay high fees to move large amounts of currency around. Funnily enough even Hal Finney discussed the concept of Bitcoin Banks. I did like his idea that even if transaction fees are not enough to maintain security then something will be built that will be linked to the distribution of bitcoins in order to protect the fair distribution of these and I suspect that would be a more acceptable approach if needed. Honestly though, I think Bitcoins hard cap will never change as if its changed once then the thought will be that it can always be changed again, and thus the cap looses any true meaning. Overall a thoughtful article and worth a read.
There’s a popular view within the non-Bitcoin crypto industry that the more educated Bitcoiners are at best naive, or at worst completely in denial on the topic of Bitcoin’s long-term supply. Put simply, Bitcoin skeptics are fond of claiming that, because in their view it’s unlikely that Bitcoin will muster sufficient fees in the long term to compensate miners, Bitcoin will eventually be forced to add inflation in excess of the rate ordained by Satoshi. According to this argument, it’s therefore misleading to characterise Bitcoin as being genuinely fixed in supply. Naturally, this argument is often intended (whether this is acknowledged or not) to justify the insertion of monetary discretion in other cryptocurrencies. Invariably, the “right” rate of issuance for these projects is understood to be nonzero in the long term.
There’s a popular view within the non-Bitcoin crypto industry that the more educated Bitcoiners are at best naive, or at worst completely in denial on the topic of Bitcoin’s long-term supply. Put simply, Bitcoin skeptics are fond of claiming that, because in their view it’s unlikely that Bitcoin will muster sufficient fees in the long term to compensate miners, Bitcoin will eventually be forced to add inflation in excess of the rate ordained by Satoshi. According to this argument, it’s therefore misleading to characterise Bitcoin as being genuinely fixed in supply. Naturally, this argument is often intended (whether this is acknowledged or not) to justify the insertion of monetary discretion in other cryptocurrencies. Invariably, the “right” rate of issuance for these projects is understood to be nonzero in the long term.
I believe that Bitcoiners have nothing to fear, regardless of whether fees are ultimately deemed to be sufficient or not.
I believe that Bitcoiners have nothing to fear, regardless of whether fees are ultimately deemed to be sufficient or not.
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