The supply issue | Bitcointalksearch.org

teosanru

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Quote from: jiamijiang on December 29, 2020, 09:12:55 PM

I'm seeing this particular topic on twitter today and it's got me a bit stumped. So I would like to ask my hero bitcoiners here for their advice:

If bitcoin's price and market cap continue to increase, and if a 2nd layer or off-network protocol allows people to subdivide their satoshis into smaller and smaller units, does the whole 21 million BTC supply cap even matter anymore?

Yes it does. It's because we are just splitting up the numbers. Increasing supply means that we are able to increase the total value of Supply when we subdivide the satoshis what we are doing is adding more decimal points. For example, if we have a total of 1000$ in circulation subdividing satoshi is like introducing cents. Now, this does not increases the supply obviously. But it's kind of a boon to bitcoin because if merely subdividing would increase the supply the price would pretty easily come down with every new decimal we create after satoshi. But I feel 2nd layer or off-network protocol is still too wild to imagine dreams. If people are willing to go on an off-network protocol then why don't we just switch over to some other currency other than bitcoin? I think there are a lot of questions to be answered which obviously will be answered with time.

wxa7115

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Quote from: shoreno on January 15, 2021, 08:25:52 AM

there are small investors that invest under 100-200 bucks , they can still invest now on the current btc system but if btc price soar really high that it leads for 1 satoshi to be hundred dollar ,

i think they are screwed but i think btc devs are going to fix this problem and will probably extend or add another decimals for the poor investors to continue participating and i think you are right that this wont screw the supply . supply will still be 21m and the growth of the price of btc are going to be unefected .

I think that eventually we are going to need to add smaller denominations than the satoshi because if you think about it if all the people in the world bought bitcoin then the amount of bitcoin that we could get is incredibly low and when you add that there are millions of coins that have been lost and there are millions of coins in the wallets of whales that are never going to leave their wallets then that amount becomes even lower.

Which means that sooner or later we will have to add a smaller denomination than the satoshi, fortunately for us since bitcoin is an electronic form of money that should be relatively easy for the developers so I do not see it as a big deal.

qwertyup23

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I think that's really a big deal. although bitcoin is infinitely divisible, it is limited to 21 million. This leads to a far future where bitcoin's transaction fees will be huge

This really goes to show that the price of bitcoin definitely has the potential to increase years from now. The problem, though, will be the transaction fees for miners as that is the only way they get compensation from confirming the transactions in the blockchain.

Like what others have mentioned, by the time that happens, maybe other altcoins in the market would become more valuable and flexible in investing. I am actually curious and I hope I am still alive by the time we get closer to the supply of 21 million bitcoins.

bits4books

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Quote from: wxa7115 on January 14, 2021, 04:08:04 PM

Quote from: jaysabi on January 09, 2021, 03:05:27 PM

Quote from: bits4books on January 09, 2021, 07:45:49 AM

So BTC as a cryptocurrency-let's be honest - did not take place in the direct sense. Now BTC is just a financial tool for speculating on the course and nothing more. It is disgustingly inconvenient to use in everyday life - it is long, slow, clumsy and too unstable.

Saying anything bad about bitcoin around here doesn't get you much agreement, but what you've said is true. Bitcoin is a horrible currency and people need to stop pretending like it's ever going to be better. It's a store of value and a speculative vehicle, not a useful currency.

I think that most people that are reasonable about bitcoin understand that at the moment bitcoin is actually not the best form of money when it comes to using it to buy stuff, it is slow to confirm and it takes too much money in fees if you are buying something small, I think most people can see that, however it has all the characteristics of money including one of the most important characteristics that fiat currencies will never have which is to be a store of value.

This is what has made bitcoin subject of speculation, but this was unavoidable and if the developers keep working in bitcoin I think we will come to the point in which bitcoin will become a good currency to use in our everyday lives.

Let me remind you that fiat currencies have quite a successful opportunity to invest in stocks and other classic fin tools - which also show growth at a distance. Yes, not as crazy as BTC, but much more stable.
And about the fact that BTC can become a convenient and normal currency, this is certainly unlikely because it is already too monstrous and clumsy. And the next fork of BTC will not lead to good because it will no longer be BTC as such, but another ship of Theseus.

Vishnu.Reang

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Quote from: jiamijiang on December 29, 2020, 09:12:55 PM

I'm seeing this particular topic on twitter today and it's got me a bit stumped. So I would like to ask my hero bitcoiners here for their advice:

If bitcoin's price and market cap continue to increase, and if a 2nd layer or off-network protocol allows people to subdivide their satoshis into smaller and smaller units, does the whole 21 million BTC supply cap even matter anymore?

How many times you have seen the price denominated in Satoshi? Sat and mBTC are used very rarely in the market. I have visited dozens of online market places, and all of them use BTC instead of mBTC and Sat. I have seen price-tags such as BTC0.0002 or BTC0.00005, but I have never seen the prices being shown as 0.2 mBTC or 20,000 Satoshi.

I had proposed this a long time back. The core developers need to consider re-denominating Bitcoin. Every existing, and yet to be mined Bitcoins should be redenominated by a factor of 10,000 or 100,000. That means that 1 old BTC would become 10,000 or 100,000 new BTC. It will be very helpful in increasing the adoption and acceptability of Bitcoin.

shoreno

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Quote from: so98nn on January 14, 2021, 11:03:09 PM

Dividing the satoshi into smaller bits only means that you can afford to buy any small amount of bitcoin with the usd that you have in your pockets. But imagine if this function would have not been there then at the current rate will you be able to buy bitcoin at all? This would have filtered out investors who only spend 100-200 bucks on bitcoin in single purchase order. In the aftermath bitcoin would have become the thing of richer people and not the Genral public. It’s division is important and it’s supply mathematically remains 21 million only. We are making subdivisions of 21 million, we are not making equal parts really.

there are small investors that invest under 100-200 bucks , they can still invest now on the current btc system but if btc price soar really high that it leads for 1 satoshi to be hundred dollar ,

i think they are screwed but i think btc devs are going to fix this problem and will probably extend or add another decimals for the poor investors to continue participating and i think you are right that this wont screw the supply . supply will still be 21m and the growth of the price of btc are going to be unefected .

so98nn

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Dividing the satoshi into smaller bits only means that you can afford to buy any small amount of bitcoin with the usd that you have in your pockets. But imagine if this function would have not been there then at the current rate will you be able to buy bitcoin at all? This would have filtered out investors who only spend 100-200 bucks on bitcoin in single purchase order. In the aftermath bitcoin would have become the thing of richer people and not the Genral public. It’s division is important and it’s supply mathematically remains 21 million only. We are making subdivisions of 21 million, we are not making equal parts really.

erikoy

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As what others had told the supply will matter because it will dictates the bitcoin market price and if there are demands bitcoin market will becoming more expensive and this is what happening to bitcoin right now. Bitcoin experience shortage of supply already and this is the reason why bitcoin market price is so high. This is how the economics demand and supply work way back in the secondary school subjects. This is also what happen when there is a shortage of food supply. Food will becoming more expensive.

AndySt

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Quote from: wxa7115 on January 14, 2021, 04:08:04 PM

I think that most people that are reasonable about bitcoin understand that at the moment bitcoin is actually not the best form of money when it comes to using it to buy stuff, it is slow to confirm and it takes too much money in fees if you are buying something small, I think most people can see that, however it has all the characteristics of money including one of the most important characteristics that fiat currencies will never have which is to be a store of value.
This is what has made bitcoin subject of speculation, but this was unavoidable and if the developers keep working in bitcoin I think we will come to the point in which bitcoin will become a good currency to use in our everyday lives.

I think that about all the characteristics of money, this is quite a bold argument, because if these characteristics can be found with great desire in bitcoin, but purely nominally. I have great sympathy for bitcoin and high hopes for its future prospects, but all these characteristics are not yet in demand in real life and it is not at all known whether these characteristics will be in demand in the future, except as a means of accumulation and a speculative asset.

wxa7115

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Quote from: jaysabi on January 09, 2021, 03:05:27 PM

Quote from: bits4books on January 09, 2021, 07:45:49 AM

So BTC as a cryptocurrency-let's be honest - did not take place in the direct sense. Now BTC is just a financial tool for speculating on the course and nothing more. It is disgustingly inconvenient to use in everyday life - it is long, slow, clumsy and too unstable.

Saying anything bad about bitcoin around here doesn't get you much agreement, but what you've said is true. Bitcoin is a horrible currency and people need to stop pretending like it's ever going to be better. It's a store of value and a speculative vehicle, not a useful currency.

I think that most people that are reasonable about bitcoin understand that at the moment bitcoin is actually not the best form of money when it comes to using it to buy stuff, it is slow to confirm and it takes too much money in fees if you are buying something small, I think most people can see that, however it has all the characteristics of money including one of the most important characteristics that fiat currencies will never have which is to be a store of value.

This is what has made bitcoin subject of speculation, but this was unavoidable and if the developers keep working in bitcoin I think we will come to the point in which bitcoin will become a good currency to use in our everyday lives.

arwin100

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Quote from: ?? on ??

Quote from: jaysabi on January 09, 2021, 03:05:27 PM

Quote from: bits4books on January 09, 2021, 07:45:49 AM

So BTC as a cryptocurrency-let's be honest - did not take place in the direct sense. Now BTC is just a financial tool for speculating on the course and nothing more. It is disgustingly inconvenient to use in everyday life - it is long, slow, clumsy and too unstable.

Saying anything bad about bitcoin around here doesn't get you much agreement, but what you've said is true. Bitcoin is a horrible currency and people need to stop pretending like it's ever going to be better. It's a store of value and a speculative vehicle, not a useful currency.

only whales who have a lot of money will try to profit from bitcoin by taking advantage of its price movements, all digital currency trading cannot provide guarantees, therefore it can be said that bitcoin has a very high risk because it can make you loss instantly and it can also make you profit instantly. No one knows for sure what price bitcoin will be in the future.

Why do you think about that? Even low ballers or small time traders can earn and take advantage to the price movements of bitcoin, but they need to be careful on their movement and always act without putting some greediness in their trades since if they wish for more and don't settle for little result then their efforts to gain will became useless.

Although whales have advantage but they still cannot guarantee if they can earn since it all depends on how the market flow and it's still unpredictable that's why we cannot assure that they always have the advantage.

exstasie

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Quote from: bits4books on January 09, 2021, 07:45:49 AM

Quote from: exstasie on January 08, 2021, 03:34:53 AM

Quote from: bits4books on January 07, 2021, 11:20:03 AM

So why do you need to divide BTC if there are much more convenient and fast cryptocurrencies for this?

There is no need. Both the "we need more zeros" camp (Bitcoin permabulls) and the "BTC is unlimited because division" camp (No-coiners) are misguided. Neither claim is true. It's all just posturing.

So BTC as a cryptocurrency-let's be honest - did not take place in the direct sense. Now BTC is just a financial tool for speculating on the course and nothing more. It is disgustingly inconvenient to use in everyday life - it is long, slow, clumsy and too unstable.

Is it really that inconvenient? It's the price we pay for transaction finality. I feel incredibly secure when I receive a BTC payment and it has 1 confirmation.

I also hate how debit cards give merchants the power to pull unauthorized amounts out of my account, and you have to fight to claw it back through a timely dispute procedure. That's the other side of transaction finality: with Bitcoin, you broadcast what you want to pay. The rest of your money is not at risk.

Lightning is also emerging as a way to provide instant transaction finality (for fiat-to-fiat transactions if needed): https://bitcointalksearch.org/topic/--5307991

So there's that too. Wink

Princejebs

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Why bitcoin is more flexible is because of it's division, it can be subdivided into small bits but will that be of value even at lower Satoshi? That will depend on the amount of money injected into bitcoin or flow of money into bitcoin market cap.
In my opinion, subdivision of bitcoin doesn't really matters because most percentage of bitcoin circulating the market is very small, others are kept by whales and they aren't going to give out any time soon.

jaysabi

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Quote from: bits4books on January 09, 2021, 07:45:49 AM

So BTC as a cryptocurrency-let's be honest - did not take place in the direct sense. Now BTC is just a financial tool for speculating on the course and nothing more. It is disgustingly inconvenient to use in everyday life - it is long, slow, clumsy and too unstable.

Saying anything bad about bitcoin around here doesn't get you much agreement, but what you've said is true. Bitcoin is a horrible currency and people need to stop pretending like it's ever going to be better. It's a store of value and a speculative vehicle, not a useful currency.

wxa7115

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Quote from: jiamijiang on December 29, 2020, 09:12:55 PM

I'm seeing this particular topic on twitter today and it's got me a bit stumped. So I would like to ask my hero bitcoiners here for their advice:

If bitcoin's price and market cap continue to increase, and if a 2nd layer or off-network protocol allows people to subdivide their satoshis into smaller and smaller units, does the whole 21 million BTC supply cap even matter anymore?

Yes the cap will still matter because the overall number of coins is still the same, you just were able to divide it in smaller units, think of the whole supply of bitcoin as a cake, if you divided it by 4 then you have four big chunks of cake right? Now lets suppose that you are able to divide that cake 1000 times, now the slices are going to be very small but the size of the cake did not change, this shows that the limit in the supply of the coins will still be there.

Also it is important to say that for some time there have been arguments about changing what we consider a bitcoin as its price is very high, some think that maybe we should begin to use mBTC as the main unit of bitcoin as right now it is the equivalent of 40 dollars which is a sum that is easier to understand than 40k.

bits4books

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Quote from: exstasie on January 08, 2021, 03:34:53 AM

Quote from: bits4books on January 07, 2021, 11:20:03 AM

Quote from: exstasie on January 02, 2021, 04:26:07 AM

All I'm saying is the whole idea of needing sub-satoshi units implies that we will need unrealistically low value transactions in the future, much lower value transactions than exist today. I just don't see the point.

So why do you need to divide BTC if there are much more convenient and fast cryptocurrencies for this?

There is no need. Both the "we need more zeros" camp (Bitcoin permabulls) and the "BTC is unlimited because division" camp (No-coiners) are misguided. Neither claim is true. It's all just posturing.

So BTC as a cryptocurrency-let's be honest - did not take place in the direct sense. Now BTC is just a financial tool for speculating on the course and nothing more. It is disgustingly inconvenient to use in everyday life - it is long, slow, clumsy and too unstable.

exstasie

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Quote from: bits4books on January 07, 2021, 11:20:03 AM

Quote from: exstasie on January 02, 2021, 04:26:07 AM

All I'm saying is the whole idea of needing sub-satoshi units implies that we will need unrealistically low value transactions in the future, much lower value transactions than exist today. I just don't see the point.

So why do you need to divide BTC if there are much more convenient and fast cryptocurrencies for this?

There is no need. Both the "we need more zeros" camp (Bitcoin permabulls) and the "BTC is unlimited because division" camp (No-coiners) are misguided. Neither claim is true. It's all just posturing.

bits4books

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Quote from: exstasie on January 02, 2021, 04:26:07 AM

Quote from: bits4books on January 01, 2021, 09:35:16 AM

Quote from: exstasie on December 30, 2020, 05:29:47 AM

One process debases the currency by increasing the money supply, the other process makes lower value transactions possible by increasing unit divisibility. These are two very distinct and unrelated things. Why do you conflate them?

In any case, I'm not sure we actually need more divisibility. Even if 1 BTC = $1M, a satoshi is worth $0.01. Do we really need sub-penny value transactions?

So after all, the conceptual problem of the entire cryptocurrency in general is that people want these transactions in the amount of a penny - the main thing is that it would not be a pure dollar but money in the form of BTC/ETH/whatever that tied to dollar.

You can divide BTC at least as much as you want and let it grow to the most cosmic prices but as long as you yourself tie it to the dollar and do not want to untie it, then you are just hostages of the most hated fiat currency.

That was just a reference to the value of everyday transactions, not a suggestion that anything be "tied" to the dollar. The dollar is the most relevant unit of account today, so it's useful to convey actual value. Much more useful than BTC, which is exponentially rising in price vs. all assets in existence.

All I'm saying is the whole idea of needing sub-satoshi units implies that we will need unrealistically low value transactions in the future, much lower value transactions than exist today. I just don't see the point.

So why do you need to divide BTC if there are much more convenient and fast cryptocurrencies for this?, nothing will help If it's duckling syndrome . Nothing will grow forever. And it's time for me to start using cryptocurrencies, not because they can sharply rise in price by 10 times, but because they can easily (hello, ETH 2.0) start competing with Visa/MC. Do you need securities or means of payment? In second case, BTC is already very morally and technically outdated and it's time to accept it.

fullhdpixel

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Quote from: exstasie on January 01, 2021, 05:26:56 AM

Well I guess that's one of the questions being raised here: what happens if/when satoshis become too large of a unit and there are no more zeros to the right? The obvious answer is to sub-divide into smaller units.

But if you think about it, that situation seems rather unlikely: $1 satoshis implies $100M BTC. I'm insanely bullish, more than most, but even I can't conceive of that, assuming USD hasn't hyperinflated.

That's why this whole discussion is sort of a joke. A very unrealistic hypothetical (like $100M BTC) is being used to arbitrarily shake faith in Bitcoin's supply dynamics.

I wonder why? Wink

I guess there is a certain problem when that happens but it also looks like it is not going to be any time soon neither. Bitcoin needs to figure out a way to make it a lot faster and cheaper before it can deal with anything else, without us having that under 10 cent and under 1 minute payment situation, we are not going to really have any problem that will be bigger.

People are not really caring about the transaction fee and timing problems right now, and being as expensive as it is right now, we still managed to hit $32.5k+ price in bitcoin, however one thing is for sure, we are not really having these superb increases because people see bitcoin as a currency, they see it as a way to make money and that's it, which destroys the whole idea of why bitcoin was created to begin with. I am not sure if we should feel good or bad about this at all.

Leviathan.007

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There is not any problem about the total supply. Because this limitation made bitcoin famous none can print fake bitcoin in basement and no government or organization can print bitcoin for no reason. That's why the inflation rate will effect the fiat currency because they print tons of money and according to supply and demand theory they will lose the price over time but bitcoin not. There is no chance to increase the totally supply, but IF somehow it changes, the price will fall rapidly. So, there will be only 21m bitcoins for all the people around the world and if you do own one signal bitcoin you are lucky.

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