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Don’t think litecoin could make it as unit of account. Not sure about dodge - what’s the transaction rate on that?

Neither has the security backing of bitcoin. Not even close.

Doge is pretty scammy, same dudes released a ton of coins and then rugged them on cryptsy. Elon doesnt know his history, sadly.

Bitcoin and Litecoin have different algorithms, SHA256 vs Scrypt. You need to be the top in your hash algo to avoid attacks, which are common in alts.

Bitcoin has a subsidy block reward of 6.25 bitcoins, rn. Another way of saying that is that every vbyte has a subsidy of 625 sats/vybte. Fees are incidental.

In 9 years that will move to under 1 BTC, or 82 sats/vbyte + fees. At this time bitcoin will have a different security model. As will litecoin. But on the upside during that epoch 99% of bitcoin will be mined.

Bitcoin needs a plan to avoid reorgs and networks splits for the era which starts when the reward moves under 1. Satoshi didnt really go into it in the white paper and there was some vague talk about competing with Visa.

Adversarial thinking needs to start thinking about 9 years from now. We have some time, but it is not unlimited.

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Discussion

bitcoiner 2y ago

"under 1 BTC" means nothing if you don't account for bitcoins price. The 50, 25 and 12,5 BTC block rewards of the first epochs could buy a lot less than todays 6.25 BTC reward.

Unless you are assuming Bitcoin has already become a unit of account in the next few years its a bit speculative to assume 1 BTC will be worth less than 6,25 BTC now.

Melvin Carvalho 2y ago

Not assuming any price value for btc in 9 years, because nobody knows. I am assuming that the security model will change. And in 13 years the subsidy will be ~40 sats/vbyte then 20 then 10, then 5. The challenge is still to prevent reorgs and network splits.

HoloKat 2y ago

So you’re assuming hash power will drop because it won’t be economically feasible for miners? That IS assuming price value.

But yeah, I get what you’re saying.

Melvin Carvalho 2y ago

You can reverse the thinking. Instead of thinking that an increased price increases the security, you can think that a robust security model increases the ceiling on the price.

FinnStin 2y ago

The only reason miners spend so much energy is because it's profitable to do so.

The only way security leads price (and this is bound to happen a little bit) is if people actually base their investment decisions on hashrate.

Maybe institutional investors think this way? They obviously will want to be sure their investment is safe.

As far as I can tell, however, the block reward plus fees multiplied by price determines the security budget, which determines security, at least in the medium to long term.

And for now, because the block reward makes up the bulk of miner revenue and is completely predictable, the price of BTC makes a much larger difference in security budget than fees do, especially when fees in sat terms can go down when the price goes up.

HoloKat 2y ago

Gotta take into account fiat value, but yea can’t hurt to think about these things.