- Perfect market information--Yep, Bitcoin is transparent. Everyone knows what everything is to the second.
- No participant with market power to set prices--Yep, I can't charge more for my mining abilities over anyone else, as the product (hashes) has no added value. For a pool, if they set prices or fees too high people leave. Poof. If a mining company charges too much a new mining company will come in (assuming the profits are high enough). But with the glut of mining stuff out there this is not too much of a problem.
- Non intervention by governments--Pretty much. They're trying though, but at the moment it's pretty simple to mine.....
- No barriers to entry or exit--Not really. You can get into the market for the cost of a miner and a PC. Very little licensing, factory making, whatever...
- Equal access to factors of production--This might be the difference if miners consolidate. However someone else could just build another miner from silicon.
- Profit maximization--Fuck God Yes!
- No externalities--Everyone's gotta pay something for power and/or heat disposal.
So with that, I think this quote sums it up best from Wikipedia:
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This attribute of perfect markets has profound political and economic implications, as many participants assume or are taught that the purpose of the market is to enable participants to maximize profits. It is not. The purpose of the market is to efficiently allocate resources and to maximize the welfare of consumers and producers alike. The market therefore regards excess profits, or economic rents, as a signal of inefficiency, that is of market failure, which is to say, not achieving a Pareto optimum.
And given that this is normal profits, the following from "Profit (normal)" really should be read by any miner:
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Economic profit does not occur in perfect competition in long run equilibrium; if it did, there would be an incentive for new firms to enter the industry, aided by a lack of barriers to entry until there was no longer any economic profit. As new firms enter the industry, they increase the supply of the product available in the market, and these new firms are forced to charge a lower price to entice consumers to buy the additional supply these new firms are supplying as the firms all compete for customers (See "Persistence" in the Monopoly Profit discussion). Incumbent firms within the industry face losing their existing customers to the new firms entering the industry, and are therefore forced to lower their prices to match the lower prices set by the new firms. New firms will continue to enter the industry until the price of the product is lowered to the point that it is the same as the average cost of producing the product, and all of the economic profit disappears. When this happens, economic agents outside of the industry find no advantage to forming new firms that enter into the industry, the supply of the product stops increasing, and the price charged for the product stabilizes, settling into an equilibrium.
Fun stuff.
