Topic: The bitcoin moon and ecology. (Read 1322 times)

Imagine that bitcoin becomes a large success.  Of course, taxes having to be paid in fiat is a strong incentive to keep fiat too.  But if bitcoin is such a success, that things states want, are priced in bitcoin.  Imagine that oil is priced in bitconi.  How's the army, say, going to buy oil with tax fiat ?  How about state employees being paid in fiat, that actually want to buy stuff in bitcoin (like bread and cars) ?

At a certain point, states may find it useful to raise taxes in bitcoin ?

As long as there are countries, they'll be able to ask for taxes and pay people. They'll choose to do that with money they have control over.

BTC will exist alongside it.

I fully agree with you, that bitcoin progress, if progress, will be slow, for exactly the reasons you mention.  However, some people here argued that bitcoin is going to drive out fiat in a matter of years or at most a decade or two, talking about S-type curves of adoption of new technology, like internet or mobile telephones.


Indeed, but, as you said, bitcoin is not just technology.  On the level we're talking here, bitcoin is big money, and big money is conservative and needs trust.  However, if bitcoin progresses so slowly, then the speculative drive will not keep up very long.   What good is a kind of money that doesn't even buy 1% of the stuff after half a century (and is not geographically enforced, as fiat is) ?

If what you say is true, that the 1% level would only be reached in half a century or so, then bitcoin already came to maturity in a sense.  The price today is then even an over estimation of its fundamental "money" value in the near future (which is what its speculative value would be).

Naaah...

Fiat will be around. Bitcoin will work side by side. People still use dial-up modems, people still use carbon copy paper for credit card swipes, etc.

Progress is slow. Change is financially and emotionally expensive and people are reluctant to do so. AI and related concepts have been tabled for half a century or more, and yet I still can't get a useful electronic assistant on my phone/PC/whatever.

Bitcoin is a novel technology and it's exciting to be part of it, but I'd be pretty shocked if my Mum uses it once in her lifetime. So who even knows what BTC/USD means in 10 years? 50 years?

Still, on the other hand, maybe I'm being too harsh on bitcoin, because we have plenty of example technologies. Who even remembers net cafes? Remember travelling without GPS / tripadvisor / google? That only took a decade-ish.

Do you really think $ 1 million is reasonable 

There has been already a thread on this, but as the forum software invited me to start a new topic as the other topic was old, I did.

Let us assume that bitcoin goes to the moon and takes over essentially the whole of fiat.  The fiat market currently being worldwide estimated at (M2) about 55 trillion $ equivalent, this would bring the coin itself to a value of something like $ 2.5 million.
Let us be reasonable and put it to the $1 million equivalent.

Now, currently, the bitcoin mining inflation is 3600 coins per day, and after say, 2 halvings, it will be 900 coins a day, and let us assume that's when bitcoin takes over.

Now what does that mean ?  Mining 900 coins a day is an incentive of the equivalent of about 1 billion $ per day (of course, at that point, there aren't any $ of any worth anymore, but we're talking of the current value equivalent of 1 billion $.)

What does that imply ?  It means that the mining community has an incentive of one nuclear power plant per week !  (estimating your modern power plant at 7 billion dollars).

Let us assume that mining has another overhead of making the electronics equivalent to the power consumption, and that miners want a ROI of a factor of 2.

That means that with overhead and profit, miners are going to build a nuclear power plant every month.  

So in "full bitcoin moon", mining will represent a serious energy budget globally if it arrives too soon.  Reward halving softens the problem of course, but you see the scale of the impact on energy consumption and production.