Time, maybe.
I strongly disagree. If they make enough good business moves and have enough time, they can accumulate more capital via the investment of newly accumulated capital than the larger miner.
Especially if the larger miner is destroying capital value through inefficient allocation.
Compounding on 1 btc vs. 100 btc vs. 100,000 btc is always going to reward / punish the biggest capital allocation. That’s just math. Can’t be bitter that some people have more than us. I’d bet on barefoot mining ahead of Riot and/or Marathon and/or Hut8 … and the at home miner can outperform them all depending on their use case and source of energy.
There is no such thing as fair. Focus on return on capital. Allocation of capital is work. Mining is 100% proof of work … appreciate you are trying to be contrarian with a new take. I just 100% disagree with your qualm. It isn’t with bitcoin mining, it’s with the current distribution of capital.
That’s not true — scale can kill you in bitcoin mining. There are not many “pockets” of free energy that are 1 GW … someone who heats their home in Alaska might outcompete Riot on a profitability standpoint.
Capital grows. So starting with capital is better than not starting with capital. But that’s just a fact of private property, there will never be a “fair” allocation of capital that doesn’t benefit incumbents.
But bitcoin mining is as ruthlessly competitive of a business as there is. Negative returns on capital compound, too.
The first miner took more risk than the second miner. If the bitcoin price went down (or stagnates) and the first bitcoin miner’s PPA is or becomes uncompetitive then the second miner actually has the advantage.
The real price of money is probably ~15% … using debt we have pulled forward demand for 50+ years worth using a (loosely, on average) 10% delta to real price of money financing … not to mention the leverage that gets applied to those assets is getting more and more aggressive with derivatives.
Probably have pulled forward at least $100T of “assets” that shouldn’t exist under a sound money standard. Maybe $200T is a better estimate and $400T is a high side.
Also, because debt is a priority claim and equity is a residual claim, if today’s $900T of assets shot repriced to $700T, the impact to markets wouldn’t be a linear $200T decline. Equities would get wiped and creditors would become the new equity holders. It’s get messy quickly.
How slow can it really be? Wouldn’t you expect a failed auction or a massive commercial real estate bankruptcy or another bout of bank failures would reall accelerate this thing?
Fiat economic land has been grinding on itself too hard for too long. Something has to break soon over there in normie land.
Remember when Sequoia had *no governance documents* to prevent SBF from executing fraud at FTX? Fraud only revealed by binance ruthlessly blowing up FTX very publicly? After *everyone* (like even Larry David) endorsed FTX and SBF? Remember that? Remember how ridiculous the simping was? Remember? And remember how they were at least 80,000 bitcoin short? At the time 3-4 months global bitcoin issuance / production.
Now think about where we sit with MSTR and the ETFs and Coinbase. Coinbase claims 2M bitcoin custodied. You think they’re all accounted for?
Does it though? I doubt it. Want to prove me wrong? Show us the bitcoin addresses.
Yeah, the “OG podcaster bunch” needs to realize that the ‘21 dudes who went all-in for the first time have waited longer and have dealt with worse performance than they ever had to endure. I’d argue we’re the better psychopaths.
A little empathy would go along way.
NGU needed to deliver returns on investment to embolden plebs to spend a little of their on living. Ignoring the importance (and lack of) NGU is missing the point. Preserving value over TIME is the killer feature of bitcoin relative to the existing paradigm. The transmitting value over SPACE piece is fairly well covered by fiat.
Blub, Bluuuuub, BLUUUUUUUUUUUB!
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When does hashrate drop? Lots of miners running at a loss?
I’d argue that knowing the design of the protocol AND the proof of work mechanism and difficulty adjustment, a bitcoiner knows that the value of bitcoin goes up over time. Whether or not the bitcoin market price goes up month to month can be manipulated BUT the fundamentals of bitcoin from a first principles level NECESSITATES NGU.
It’s just a function of on what timescale and how aggressively. Right now the fiat assholes are doing a pretty good job manipulating the bitcoin rate of exchange markets.
I blame Coinbase.
Can’t afford what I want to do yet. It is capital intensive. Need NGU, as is promised.
COINBASE
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