In my book 1 in 3,000 is insignificant
What's nonsense is your calculation. As per on chain analytics resource, Glassnode - 78% of BTC supply is illiquid.Let's agree to disagree. In my book 1 in 3,000 is insignificant but I accept that is a subjective call.
Let me explain how the security of the blockchain works. Each block comes with a Proof of Work. The "work" referred to here is tweaking the block (through the nonce) until its SHA256 hash has the required number of leading 0's. This was originally set at 32. So the number of tweaks and re-runs of SHA256 was of the order of 2^32 or 4 billion. This was deemed quite good enough to ensure that it would be impossible to alter a block once it had become about 3 deep in the chain as everything ahead of it would also have had to be re-run and it would be impossible to catch up with the original blockchain which would have grown longer in the meantime. The longest version of the blockchain is the one that is deemed the correct one.With increasing scarcity, the processing power to secure the bitcoin in mining needs to be increased. As the processing power is increased, the difficulty adjustment is also increased. As the difficulty adjustment is increased this makes the network more secure.
Same source 3m is Highly Liquid. The 930 new bitcoins should be seen in the context of either the 3m volume per day or the Glassnode assessment of 3m Highly Liquid.What's nonsense is your calculation. As per on chain analytics resource, Glassnode - 78% of BTC supply is illiquid.
That's a bit rich coming from you. I have discussed at length and repeatedly bitcoins shortcomings. I accept that it could still fail. Meanwhile you have never recognised any of the positive characteristics of bitcoin.As always you never, ever give any ground.
@WolfeTone concedes the point. You never will. You don't happen to be related to an American guy with a strange comb over hairstyle, do you?
That's what I mean by stubborness. Do you concede that increasing the Difficulty is about controlling the timing of bitcoin release rather than adjusting the security level? Careful, I am refreshing my understanding by re-reading Mastering Bitcoin by Antonopoulos, and that's how he describes the situation.You're also wrong in your take on bitcoin network security. As the hashrate goes up, so too does the level of security making it the strongest network of its kind on the planet.
That you didn't do the helpful thing and comment as to whether @WolfeTone or myself have it right on the interplay between "halving" and security should be a big pointer to @WolfeTone in that regard.I don't claim and have never claimed to be an expert on bitcoin first and foremost..far from it. An increased hashrate equals heightened network security.
You're going back over old arguments (covered over the course of 4 years) trying to find a way to meet your narrative...which doesn't put you in a strong position to talk about stubbornness!
Do you concede that increasing the Difficulty is about controlling the timing of bitcoin release rather than adjusting the security level?
Glad to know I haven't got this all completely wrong. The numbers are mind blowing, I am re-reading Antonopoulos and haven't got that far yet but I don't remember numbers that big.I agree with everything you said in your previous detailed post about mining, except this. I see where you're coming from, but both are related. If the difficulty did not increase the rate at which blocks are mined would keep increasing, all of the bitcoin block rewards would already have been mined which would have perhaps not left enough incentive for miners to secure the network.
The schedule of the block rewards is deliberate to give bitcoin time to grow. Both in terms of the diminishing block reward having higher fiat value, and the transaction fees increasing, so that miners still have sufficient incentives going forward. If there is any concern here, it's that the schedule will not give enough time.
Something like that. Current difficulty levels are way, way in excess of what is necessary to make the blockchain incorruptible but as @DazedInPontoon explains they play their part in maintaining the integrity of the mining infrastructure which indirectly underpins the integrity of the blockchain.My understanding of your post is that the levels of difficulty in the chain are unwarranted as by the 3rd block, the mathematical equations were complex enough to ensure it was impossible to alter the block at this point as to do so would require a period of time and processing power that would be useless by virture that, over that same period of time another block (the 4th block) would have been added to the chain? And as this is now the longest version, then it was the valid chain. And any attempt to corrupt the chain would have to recommence on that chain? By which time, another longer chain would have developed and this is the valid chain? Or something like that?
Never bothered me too much but then I am the sort who will be the last person to own an electric car.Certainly, the electricity consumption has always been a red-flag in my patch of the woods.
I'll give a discussion on the whole money thing a miss, but I will watch that clip. Don't really get your point on the double spend of Au. Au has a specific gravity of 19.32 and is completely verifiable, albeit it is not possible to ascertain whether it was newly mined, an heirloom or simply stolen.Instead I shall, which should please you, revert to reknowned political and economic historian Niall Ferguson (not of Nobel calibre, but if I understand correct, he schmoozes in those circles).
His 6 part documentary series "The Ascent of Money" is worth a watch if you havent seen it already. Episode one is provides good insight into how money is nothing more than a human concept derived from trust. Over the ages as we know, all sorts of things were used as money in one manner or another, seashells, paper, clay tablets, God, metal.
The critical point is that gold became the globally accepted measure of money, because it was the hardest form of money.
If you are not inclined to watch the whole series, or even a full episode, I would recommend episode one from 8mins 30sec to 11mins 40sec's.
Ascent of Money episode 1
In Fergusons words "money is not metal, it is trust inscribed. It doesn't matter what it is inscribed in, paper, clay, a screen, provided the recipient believes in it"
So money is not metal, but if the price of gold rises high enough, there are miners willing to invest inordinate amounts of time, energy and resources to extract it out of the ground - it having become increasingly difficult to do by virtue of all the mining that has already gone before. And the only way to ensure that one piece of gold is new gold, and not a piece being double-spent, is to establish a vast network of vaults, registrations, custody orders etc on a global scale.
Let's agree to disagree.So who do I listen to when trying to grasp a sense of progress in this area, economists? Nope, I listen to the technologists and innovators and entrepreneurs. And if you spend sometime listening to their side (not including price projections), then from my perspective, bitcoin is only at its infant stage of its life cycle. It hasn't even learned to walk yet.
It may not survive into adulthood, but it is growing fast and very robust. And, as it is being claimed, it is the hardest form of money, inscribed in digital form. That has value.
Current difficulty levels are way, way in excess of what is necessary to make the blockchain incorruptible
Never bothered me too much but then I am the sort who will be the last person to own an electric car.
And, like the electric car, is it possible that technologies and innovations will emerge, overtime, that will make bitcoin mining more energy efficient?
But generally I'm on the side of using bitcoin for more things and gaining more value from the security of the chain rather than worrying too much about the proof of work mining. Bitcoin can be a global public good in the form of trustable immutable ledger, we should aim to use that for as many possible things as we can as the marginal cost of doing so is low to zero.
I was just making the point that at these enormous difficulty levels we are way, way, beyond the difficulty level having any implications at the margin for the integrity of the blockchain.And, perhaps, difficulty levels in mining for gold are way in excess of what is necessary? Yet, overtime, industrialists have invested time and resources into developing better technologies to extract more gold where otherwise it would have remained out of reach.
I am not a complete Luddite. As a technology blockchain does not make me swoon but I can see it could have uses.Wolfetone said:you need to step aside from the price volatility for a period and look behind the bitcoin curtain!
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