Topic: NFTs in the Bitcoin blockchain - Ordinal Theory - page 21. (Read 9532 times)

The arguments you are making about hashrate, price and the future are not new. They are nearly as old as bitcoin! And yet we have seen both price and hashrate go up consistently, we've even seen hashrate go up when bitcoin has a bear year.
The fact is that things that affect hashrate are a lot more than just price and they are complicated enough to prevent speculation like this. Even at the current price the profitability of mining bitcoin varies massively from a tiny amount for those with high electricity price to those with basically free electricity (eg $0.0014/KWH). That alone renders all your speculation about future profitability wrong.

Check out comments from 2017 and you'll see that everyone wants to see their transactions processed within reasonable time at a reasonable cost. Nobody wants to send a transaction at a high cost and still see it get stuck for days not confirming.
That's what spam attacks do to bitcoin. They can even prevent the growth and even cause price to dump.

Whether we like Ordinals, or not, there's nothing the community can do, except debate and express their own opinions. In theory there's something we can do = another soft fork, but practically speaking I believe, after Taproot - which brought us a development of using the blobspace for an unintended purpose, there will he no soft forks for a longer amount of time because of a "distrust that it might bring something unintended" again.

must be nice getting your power for free. i guess that's about what it will have to be someday to able to make a profit from mining.  

how are you getting your power for free though.  all your machines would not be profitable if you had to pay normal rates for it

That number does not change with low fees either, so not sure what is the point you are trying to make, the only way for transactions to be so cheap is when blocks are not full.


Using and owning/buying are two different things, besides, the same thing will happen when fees go above $1 many people will stop transacting using BTC, same thing for when it hits $2  or any other number, but if it stays at $200 it simply means there are enough people willing to pay that much for a reason.

In reality, BTC is a final settlement protocol, it is like the settlement that happens between central banks ones every quarter of even yearly, final settlements are expensive and slow in nature, fees are low now because on the grand scheme of things nobody uses BTC for payments now, but eventually, it will be a lot more expensive regardless of who are the people using it, but again, BTC does not need you to transact it, just by holding it gives it value, it is like saying Gold is expensive to move, and thus it is useless, ya it is hard to take a bag of Gold to spend it at your local store, easier to use your credit card, that does not take away from the fact that Gold is superior to fiat.

I would not count on BTC on-chain to be usable by average people for daily small payments, fees above 5$ is easily doable without NFTs, it is only a matter of time.

I have been doing for 11 years. started with a mac pro and a single amd gpu.

I have 200kwatts used out of 275 kwatt max.
I have 2.3ph paid off sha miners
I have 45gh paid off Scrypt miners
I have 10gh paid off  gpus
I have some kda miners not much
I have some grin miners not much

my really good cant lose power is capped at 275 kwatts

so my expansion number need to take that into account
the no debt expansion is absolutely critical since I dont fear the bear no loans coming due.

Am i an expert no. but i do know what is good for me to do.

Free market is actually very simple, as long as people of power don't meddle with it.

maybe you're missing something change your phrase to "more people that are trying to use it" would make more sense. bitcoin can only do 7 transactions per second no matter what the transaction fees are...

well if bitcoin transaction fees ever go over about $5 i'll be using something else that has a more reasonable transaction fee. why pay through the nose when you don't have to?

This is one part of the issue here, we don't seem to have a perfect agreement on how blocks should be, you want them to be as empty as possible, while I might want them to be as full as possible, I don't know about you, but sure thing is I could be biased as someone who mines bitcoin for a business, but I am pretty sure I am not alone in this.

Keep in mind that I am on a "moderate level of greed" compared to many other miners, most miners I know hate LN because they think it takes away from the fees which they could have otherwise collected, I have to always defend things like LN in front of most miners and try my best to explain to them that despite taking away from them, it's all done for a greater purpose, and should LN becomes mainstream, blocks will be full again and they would be making even more money.

I also try to tell them that it's best for us as miners that more people actually "BUY" bitcoin and not just transact it,LN users have to buy Bitcoin to start with, so the more users mean more buyers which essentially leads to a greater value, more rewards for miners and more security for everyone else, so basically, the more users the better for everyone, which is why I don't like to dismiss the rights of anyone who wants to use the blockchain in the way they like, you want to build a layer-2 system to allow people to make small transactions? I won't go against it, you want to hold some NFTs on the blockchain? I won't go against it, anything that brings more users/value to the system is going to be good for bitcoin as a whole.


I wouldn't call myself a miner expert, but I have been mining for nearly 7 years now, starting from a small mine at home, to now having a 2MW farm, having managed a few extremely large farms, spoke with folks who own even larger farms, pools' owners, even with mining gears manufacturers, I can tell you that Phil's concern is valid.

It's hard to tell whether we look at short or long-term profit, but I would assume it's something in between, Phill's power deal forces him to always think ahead of the other miners like myself, he gets 50% of whatever he mines using x power (which is limited), and he needs to buy the gears, so he would probably do some medium range maths to decide whether to invest the next 20k in SHA256 or in Scrpyt, the calculation he does now, is probably going to be different from the one he makes 10 months from now when BTC's halving would be 2 months away.

So if his 20k is going to ROI in 3 years with SHA256, he will just go with another algo, regardless of whether or not he thinks that BTC will stay there forever and Doge/LTC could die in 5 years.

I will be forced to follow the same logic that Phill's applies as we move further into more halvings, in fact, I face this dilemma every time I make a new purchase, I spend days with my partner trying to point that cash to the "perfect" algo, we both agree that BTC has more future chances of survival then LTC or Doge, but when it's 2 year ROI vs 8 months ROI for the same amount of power, you will seem to focus more on the short-term than not.

As the rewards shrink in value, the difference between mining BTC and other coins could be even greater than now, to the point where most miners would start looking at short-term as opposed to long-term, and there are only 2 things to stop money from going into those coins and to keep it flowing to secure BTC.

1- Increase rewards (you can't do that with the block rewards, can't play with the max supply) so it MUST come from fees.
2- BTC's fiat value has to grow a lot more than the other coins to offset the ROI difference.

No.2 is more difficult to happen since those coins have a much lower market cap than BTC and it's easier to increase their value than BTC, the good thing however, it's also a lot easier to bring their profitability down since their hashrate is a lot lower than on BTC when translated to value > hashrate.

Where did he state that the majority supports Ordinals, and since when is bitcointalk the gate to the majority?

It's roughly what's happening, I guess. Miners follow profit, but there is concern on whether short-term profit is greater than long-term, or if excessive fee rate is more desirable in the end. I can guess the miners don't care a lot about the long-term, but a mining expert can give us some better insight.

If only it were this simple.

Agreed. People should stop taking extreme positions.

Bitcoin is the perfect embodiment of a free market system (hashing difficulty adjustment).

On-chain for big transactions + off-chain for microtransactions = equilibrium achieved

Well I look at this from a mining viewpoint. My power deal will always be good to earn profit.

As some say mining a btc costs 16k for me mining a coin costs 50% or 10.2k and the 50% is a constant.

Wether I mine any algo I pay 50% all the time.

So I look at mining from a different viewpoint then others.

Nfts and ordinals will boost fees which in turn means I earn more btc.

I realize higher fees may make btc investors not want to have the coin.

and lower fees will make miners stop mining the coin.

If you think the majority supports ordinals, why don't you create a poll on this and we'll see who's the majority?    

I'd gladly fork this crap off immediately but unfortunately I'm not a core dev so all I can do is urge people to act responsibly (rarely works).  

P.S. And all these 200k ordinals were create by 200k people? Or a dozen of spammers?  

The discussion reminds me of the sustainability problem. On one extreme, if all moved to lightning there would be minimum incentive to mine. On the other extreme, if all moved on-chain, there would be minimum incentive to use due to the excessive cost. Obviously we'll find an equilibrium.

Forget coffees and teas. This could happen if millions joined the network and wanted to open just one lightning channel.

Those are basically correct, both, but neither contributes or is required for the security of the system. Whereas in PoS, 'deposits' are the only means of security for the system.
Lightning's security is fully based on the blockchain, which in turn is fully secured by PoW.

LN node must have a btc deposit by the operator. pretty much a fact correct?

LN node makes btc for the operator. pretty much a fact correct?


While the foundation to the LN node is the mining go the blockchain it is a pos hybrid = do you agree to that?

n0nce it may be a fine nuance to say LN is based on mining I agree it is but it is also based on staking because you must leave btc in it to work.

I run a full blockchain node and it has 0 btc in it. It is a pure based  mining node. LN is not.

Back to the real issue scaling an algo and having enough miners to protect the algo means enough rewards for the miners to keep interest.  Will NFT's do the Job Will ordinals do the job I don't know. And would they have the staying power to keep doing it for years or decades I don't know. I do suspect that it they stick around  they would be a saturated product and not a lasting in demand product.

That is the best argument for not having them at all.

The issue with such statements is that routing fees or amount locked up in channels have no significance in the security of Lightning, whereas this is the basis of PoS coins. Totally different things.
If you earn yield when loaning (any type of) money, that doesn't make that currency PoS and reliant on staking for security, either. Bitcoin's and Lightning's security is and always will be based on proof of work, no matter if you use your BTC to provide someone a service they are willing to pay you for.

That's why I advocate for reducing blockchain load for small transactions e.g. by moving them off-chain, where they have virtually the same security, while keeping the blockchain pretty cheap and easy to host and sync, which is paramount for decentralization.
I am not sure myself how much volume we can handle with a combination of Lightning & on-chain at the current block size, but I heavily advocate for keeping it as low as possible for as long as possible. Ordinals goes completely against this by effectively reducing the block space we can effectively use for transactions.

That could happen as result of people using Bitcoin to buy coffee, not just using NFTs, the blocksize is too small, and takes 10 mins on average to process, any medium sized country using BTC for daily payments will cause the thing you worry about, why assume that only NFT will cause this? By the way nonce when I say "you" I do not refer to you as a single person, just a general statement.


If BTC is worth 200k and fees are at 200$ it simply means that more people are actually using it, there is no need to convince anyone at that point, you need to keep in mind that the 200$ is set by users not by miners, if enough folks pay 200$ fees will be 200$, if they think it is worth it, they will keep paying it, nobody could care less about how sad anyone else for not being able to use the blockchain to pay for their 20$ bill at walmart. If anything, higher fees simply mean people with more value are using the network, does not matter who and for what purpose.

Simple, killing people is "technically possible", but is not "okay". The same with stealing, and any other kind of malicious behaviour. Even if something is "physically possible to do", it doesn't make it "okay" automatically. Here, the difference is that "physically possible" is determined by consensus rules, so it is like reaching consensus about the correct value of the gravity constant, and making sure that picking some wrong value will not lead into transforming everything to a single, huge black hole.

Also, there is a difference between supporting on-chain NFTs, and supporting LN NFTs, sidechain NFTs, or any kind of off-chain NFTs, or even no-chain-signature-based NFTs. For me, the wrong thing is not that NFTs exist, it is the technical way of how they are handled. Also, if someone thinks that NFTs are good from mining perspective, then notice that if the content of those NFTs would be stored off-chain, then miners could place more such transactions in the same block (and then there would be no problem with censoring those transactions, because then they would look the same as other, non-NFT transactions).

I don't think so. Segwit was the latest blocksize increase, and after that, Taproot didn't touch those limits (and I don't think any new soft-fork ever will, quite the opposite: since NFTs, I rather expect stricter rules and limiting the block size). Increasing the maximum block size will affect Initial Block Download. Now, one week is not enough to download and validate the whole chain, using a well-connected server with static IP, running 24/7. Any block size increase will make it worse. Imagine that new node operators will have to wait a month or longer to synchronize with the network, even if they want to use pruning. And note that the only way to truly check if some node has all blocks or not, is to download all of them, because it is possible to use non-official client with custom pruning settings, that will store blocks, based on the number of times someone requested it.

I guess it means that LN nodes usually are rewarded without any kind of mining. That means, if you put all coins into LN, then those LN nodes will get all fees that could otherwise be paid to the Proof of Work miners. Imagine a lot of LN channels that are never closed, or when they will be settled on-chain very rarely, maybe also with batching, so once per year, you will see a single 100 kvB transaction, that will close a lot of channels (inputs), create a lot of new channels (outputs), and will pay one satoshi per virtual byte, so 0.00100000 BTC. Then, LN nodes could get for example 1 BTC in routing fees, while on-chain Proof of Work miners will get 100k satoshis (or even less, if everything will be even more batched). Also, more extreme cases are possible: for example, a single input with N-of-N Taproot multisig, and a single Taproot output with M-of-M multisig, that transaction type would consume 111 vbytes. Then, compare 111 satoshis as the minimal fee, with 1 BTC of the routing fees that could be collected by LN nodes in a long time.

hidden nft with an encrypted code could make them more valued not less.


As to long term effect of second layer LN to actual blockchain fees.
And turning btc into a POW+POS coin you are correct it is a bit off topic.


My fear for btc is scrypt algo and merged LTC/Doge mining being the superior algo for mining in the long run.

I see BTC as broken but not today more like 2056.

The visible path for the sha256 algo and the visible path for the scrypt algo looks better for scrypt.

Maybe it is why some are pushing NFT+ordinals as a fix.