patnor1011
first let me say that you have already impressed me immensely with your selfless contribution to GRF by your IC thread alone, so please forgive me that I must strongly disagree with you on this one, not on the risk taking - decision making part, but on specifically Bitcoin being a great investment or that anyone should consider getting in to the Bitcoin mining game at this point in time....
then again I may just be misinformed, and your knowledge on subject is obviously superior, so if you don`t mind, could you educate me a bit?
1. when using top tier specialized mining gear - what are average power consumption? for example kWh/BTC. What are average time spent to mine one BTC per one device?
2. Do I understand correctly that for any transaction via BTC to be verified (accepted) the current blockchain must be solved by some miner and proven to be correct (excuse me if I am rambling in terminology - in laymans terms - for transaction to be complete some miner (or many miners together) somewhere must verify it?)?
3. To motivate miners to do their work and keep system going by mining (or verifying transactions) it genereates new BTC as reward, but to combat possible inflation each new BTC is much harder to mine?
4. For system to have any integrity there must be many unrelated miners, all agreeing on current blockchains being correct?
5. Irregardless on how many BTC are being transferred there is the same amount of work involved in proofing of transaction?
6. How many BTC transactions are happening in world currently on average (transactions per hour, amount of BTC changing hands per hour)?
7. What are current wait-times for a transaction to be completed/verified? Are there any projections for future wait-times if system grows? How does it compares cost-vise and time-vise to the traditional money circulation (bank transfer, paypal etc.)?
8. What happens when (not if) work of proving the transaction far outweighs value of BTC being awarded for said work? Is there any plan of action or consensus in BTC mining community on this question?
9. What happens when due to diminishing returns of mining there is concentration of mining power in few mayor players, say mining farms in politically sensitive regions like China or Russia - does that not threaten system integrity?
10. What happens if there is a disagreement on blockchain integrity, must every user check for solution themselves (as I understand it is much quicker and easier to check that chain is correct than to solve for a new one, but still...)?
11. What happens if, due to a lack of miners, wait times surpass threshold to be useful in daily transactions or there is cost-of-transaction implemented that is greater than traditional money transfer costs?
12. Do you really think that a system of exchange of values (currency) can exist on global scale in our civilized world where there is no way of accountability? I mean there is cash, of course, but most civilized nations in the world regulate cash deals very strictly, and with very good reasons. So basically, what happens if by some miracle BTC is officially universaly recognized and must come in to the fold of global economy, who is accountable, who can prevent or investigate criminal transactions, or even more prosaic, how are taxation implemented?
Also I must strongly disagree that BTC is or can be used for store of value, I would bet that >90% of current BTC owners are treating it as short term investment hoping to cash in on price changes, it makes the global BTC market very very unstable...
For Bitcoin to have any inherent value besides the speculative hype there must be some usefulness it offers to the world, a greater good if you will. It would be the case if BTC could become the one main cryptocurrency of the future, but as it stands, I just don`t see it happening. I mean, yes, it was the first (major) one, it basically introduced the world to the technology of blockchain and to the idea of cryptocurrency. But do you really mean to tell me that the old man Satoshi made it perfect in every way on his first try, and that there is no room for improvement? How long till there comes along some better-designed one, one that really can enter our daily lives, easing money circulation as we know it. I bet there is a lot of very bright minds working on it this very moment, and I would be very suprised if there already wouldn`t be plans made for a block-Dollar or chain-Euro; That is for shure, technology is here to stay, and we will use it one way or other, but I for one just can`t see BTC being around for much longer with all of it`s inherent flaws... and when
any other cryptocurrency starts gaining significant ground - BTC will crash and burn, there is no value to it, it is just how the phenomenon of currency works...
tl;dr:
BitCoin, cryptocurrency, dollar, euro, any of the currency has no inherent value at all, just ask any German in 1923 or any Zimbabwean in 2008; Money (currency) by it self is no more valuable than paper that it is printed on... So recognize Bitcoin for what it is = it is a tool (just like any currency) for exchanging values, if it is the best tool (best designed) for the job, then it is here to stay and there is a chance that BTC will hold some of their value, BUT if there is
any room for improvement, well lets just hope that there is some gold to e-scrap in them antminers