06 Nov 21
@sonhouse saidMining isn't what is sounds like. It is a reward for confirming transactions which keeps the whole thing running smoothly without central control. Bitcoin is inflationary by rewarding people with bitcoin, but there is supposed to be a limit to how much bitcoin is created and at that point bitcoin will become deflationary because some people lose bitcoin forever from corrupted hard drives and other mishaps.
Anyone know? And why is there mining involved, sounds bizarre to me.
When bitcoin can no longer be mined the incentive for mining will come from transaction fees. They have to increase which makes me skeptical that bitcoin will be practical for small purchases in the future when that happens. I think that is why Bitcoin Cash may have a future some day since the transaction fees are relatively lower than Bitcoin. Nobody seems to share my enthusiasm for Bitcoin Cash yet though.
Bitcoin has an advantage simply because it was first and is the biggest cryptocurrency there is. Despite long term uncertainties with transaction fee increases nobody wants to bet against it. El Salvador bet on it and it is paying off for them despite the volatile price swings.
06 Nov 21
@sonhouse saidThis might help you:
@Metal-Brain
Thanks for that but what has it to do with mining?
https://en.wikipedia.org/wiki/Bitcoin
06 Nov 21
@sonhouse saidAbsolutely nothing in the true sense of the term.
@Metal-Brain
Thanks for that but what has it to do with mining?
Bitcoin is just one of numerous "crypto currencies which only exists as computer code.
I read once that generating bitcoin ,which uses vast amounts of electricity to run the super computers is responsible for 50% of the output of the U.K's national grid.
If this is true,I think it should be banned.
06 Nov 21
1 edit
@venda
If that was true, doesn't that make bitcoin a ponzi scheme in the end?
So "mining" is not digging in the ground, it is mining for a better solution to some problem?
If so, that sounds like it will only be a game played by big boys with ultrasupercomputers and I predict, someone will figure out how to use quantum computers for whatever the hell problem we are supposed to optimize or whatever, a QC would probably do that job a billion times faster than any digital comp.
06 Nov 21
@sonhouse saidNo.
@venda
If that was true, doesn't that make bitcoin a ponzi scheme in the end?
So "mining" is not digging in the ground, it is mining for a better solution to some problem?
If so, that sounds like it will only be a game played by big boys with ultrasupercomputers and I predict, someone will figure out how to use quantum computers for whatever the hell problem we are su ...[text shortened]... optimize or whatever, a QC would probably do that job a billion times faster than any digital comp.
A ponzi scheme is essentially a fraud akin to pyramid selling I believe.
All crypto currencies are basically algorithms that computers solve .
It's all about CRYPTography. based on prime numbers.
For example if I generate the number 91 the only way to obtain this as a product of 2 primes is 7*13
However if the prime number I generate is 50,000 characters long it becomes a lot more difficult to find the 2 numbers to make the product!
Computers are set this task.Once they have the solution a bitcoin is generated.
07 Nov 21
@venda
Well it still seems this scheme will be obsolete when quantum computers become mainstream because they will solve those kind of problems in a microsecond that would take the fastest supercomputers on the planet taking hundreds of years if ever.
07 Nov 21
@sonhouse saidQuantum computers will not be able to do that for decades.
@venda
Well it still seems this scheme will be obsolete when quantum computers become mainstream because they will solve those kind of problems in a microsecond that would take the fastest supercomputers on the planet taking hundreds of years if ever.
@sonhouse saidIt doesn't. It is just a term that I think is misleading.
@Metal-Brain
Thanks for that but what has it to do with mining?
It is a reward for confirming transactions which keeps the whole thing running smoothly without central control. There has to be an incentive for doing the calculating. You earn bitcoin and some transaction fees as a reward.
When there is no more bitcoin available to mine I suspect people will look to altcoins with lower transaction fees. People are generally not looking that far ahead though. If they were Bitcoin Cash and Litecoin would be doing better than they are right now. I expect privacy coins like Z Cash and Dash to do well in the future, but few people seem to know much about the eventual deflationary aspect of some cryptocurrencies. People seem to prefer alt coins that have no inflationary cap which I think is foolish. That tells me a lot of people that invest in cryptocurrencies are just clueless followers.
07 Nov 21
@metal-brain saidYou hear abut people "investing" in crypto currencies and making big percentage gains in the short term.
It doesn't. It is just a term that I think is misleading.
It is a reward for confirming transactions which keeps the whole thing running smoothly without central control. There has to be an incentive for doing the calculating. You earn bitcoin and some transaction fees as a reward.
When there is no more bitcoin available to mine I suspect people will look to altcoins ...[text shortened]... foolish. That tells me a lot of people that invest in cryptocurrencies are just clueless followers.
Trouble is, they are unregulated(although I believe there is a regulated one now but the name escapes me) and a lot of investors are in it for fear of missing out.
I think it is bound to go the same way as the south sea bubble and the dot com boom.
As a long term investment, I wouldn't go near it.
07 Nov 21
@sonhouse saidWhen quantum computers were first mooted many years ago I read about a quantum lawnmower.As you say such a machine could cut every blade of grass to a specific height in seconds.
@venda
Well it still seems this scheme will be obsolete when quantum computers become mainstream because they will solve those kind of problems in a microsecond that would take the fastest supercomputers on the planet taking hundreds of years if ever.
The downside according to the article was that it would take years to programme it so it would be quicker to go round with a pair of scissors!
07 Nov 21
@venda said"As a long term investment, I wouldn't go near it."
You hear abut people "investing" in crypto currencies and making big percentage gains in the short term.
Trouble is, they are unregulated(although I believe there is a regulated one now but the name escapes me) and a lot of investors are in it for fear of missing out.
I think it is bound to go the same way as the south sea bubble and the dot com boom.
As a long term investment, I wouldn't go near it.
I think bitcoin will do well until it gets close to the point where bitcoin is no longer created to reward miners. That is is when transaction fees will have to increase to provide the incentive to verify transactions. How well Bitcoin does after that point depends on the ability of the Bitcoin community to reach consensus. It is not at all clear that will be a smooth process. For that reason I agree with you. I question the long term stability of Bitcoin.
Most cryptocurrencies are crap. The vast majority will fail miserably and the only reason they are doing well now is because it is a fad. I have also noticed that alt coins tend to follow Bitcoin up and down during volatile swings. If Bitcoin crashes it will drag most of the alt coins down with it.
In other words, tread carefully if you invest in cryptocurrencies. Most are overvalued, especially those that do not cap inflation. They are failures waiting to happen. Bubbles waiting to burst.
07 Nov 21
@Metal-Brain
Don't think you have been keeping up. China now has a QC exceeding the capabilities of supercomps and that is with only a few dozen qubits. To make them real, thousands or even millions of qubits so that will take time but they are already more advanced than you seem to know about.