For a large entity with the agenda of overpowering the network, without ASIC the system is a cheap combination bike lock.
When all asics come on line the hashpower makes overpowering the chain much more challenging.
This will be reflected in bitcoins worth. what is worth more? a 4 barrel combination bike lock or a bank vault?
More hashpower means more security. worth of a storage facility is proportional to its security.
After the first genesis block was laid, when difficulty was 1, had you been privvy to the network you could have overpowered it with trivial computing power. Would you prefer it stay like that, just so you can mine easier?
I disagree. The only reason this has been true in the past is because a relatively large portion of people involved with Bitcoin at the moment are involved in mining or investments in mining. The average user of the future wouldn't know anything about the security of the Bitcoin network. How many people who do online banking know what https or a public and private keypair are?
We are not talking about the worth of a storage facility when we are talking about Bitcoin as it becomes mainstream. We are talking about the worth of a currency.
Any E-Currency that is easy to crack is doomed to fail.
Mainstream joe public has little to do with anything. They are just consumers who will only shape the interface as producers try to please them.
Large growth will be garnered by large vendors getting on board, granted the CEOs of these companies may not be computer whizzes or know anything about cryptography but they have employees and freelance advisors who are cold and objective and VERY good at math like Spock.
BTC is a fungible asset based on proof of work, ecenomically it is identical to gold; Imagine if somebody worked out a way to quantumly lock onto gold atoms within 1000m and teleport them into the back of their van lab. Word spreads and gold funneling vans are zipping around everywhere. do you not think this softened security would undermine golds value as an asset? I think you'll find it would! Even if all the gold bugs knew nothing about the details of quantum teleportation.
The fundamental worth of any currency is ONLY related to its ease of use (liquidity) and its security.
Of course fiat currency, does not abide by these fair laws, it has its own set of laws that are enforced by its issuers and accepted by its users. So maybe you're still thinking with a fiat mindset? Fiat currency is only as secure as a few people choose it to be, with quantitive easing a handful of big-wigs can inflate the currency at the push of a button as and when they please, that's pretty dodgy when you think about it.
Your examples seem to be arguing against something else other than what I have said.
What I disagree with is the idea that Bitcoin will be valued directly based on its security more because "the hashrate is higher". It has proven to be secure and continues to do so. If it was proven insecure before but then goes on to be proven secure for a year, that would be a different story. I am arguing against the idea that a massive increase in hashpower will directly increase the value of a Bitcoin.
Changing your public/ private keys on your bank's website from 2048 to 8192 is not going to get more customers.
Never, ever did I say if Bitcoin were to lose its prowess in security would it then continue to be successful.
If Bitcoin's security is proven ineffective --> price will drop significantly.
If Bitcoin suffers no security issues --> price may go up due to other factors
If Bitcoin hashrate increases --> price will not go up because of this.
In the second underline, you are forgetting about supply and demand, which is a significant factor in Bitcoin specifically due to the few and growing users and the fixed supply. A simple news article can cause large changes in price that would not be true for USD.
