Topic: What if Bitcoin was copied but didn't need to generate coin. (Read 1263 times)

While true you can divide a bitcoin however the finite number of 21 million is still a huge issue at the end of the day because 1 bitcoin is still only worth X.

What would a bitcoin have to be worth to impact the entire world financial system?  $ X 21 million

That would result in one very big issue, a large majority are owned by very few people, maybe XXXX worldwide. Those people would become so wealthy, powerful etc that the forbes list would have to be renamed and add a trillionaire spot(s).

It just won't happen, can't. If it ever did based on a crypto it would be government owned/backed, there is no way the government would allow it any ways. All the hypotheticals are fun but again, futile.

interesting concept

An elementary error. See https://bitcoin.org/en/faq#wont-the-finite-amount-of-bitcoins-be-a-limitation (not that you should need to if you think a bit...)

I suppose anything is possible, the coming decades will certainly be interesting.

still staying off topic. but anyways
its happening now.. its called privatization... where 'public' services used to be paid for using tax, but are now done so by private companies via their consumers.

once government sell off all their "assets" (public services) people WILL start to wonder what are they paying tax for.. so all we need to do is help this process along, by making bitcoins involved in the privatization efforts.

this is the future. but its not the future of 2014-2015.. its the future of many years. bitcoin is still a toddler and needs to grow to truly get to these goals..

alot of people think bitcoin is just a 5-10 year project, but its a century long project atleast. yet these kids think they should run before they can walk.

so now is the time to teach these kids the right and wrong way to do things, and allow them to grow up and become independant..

by that i mean hospitals wont become 100% bitcoin funded tomorrow, not even 1%.. but with time the balance of funding WILL change,, and we are all at the start of it, it all bgins with us talking to public services about alternative funding.. and let the idea grow

That starts off as sounding totally elitist (for obvious reasons, not everyone has bitcoins or ever will afford them) and transitions into a dream where the governments say ok everyone you run services now, sorry about that taxation stuff.

In theory a lot of things sound good, maybe even deserve a trial run but at the end of the day it comes down to brute force or the threat of it. Putin is a prime example of this idea. It does not matter if we are in 2014, we are more humane, equal rights, sovereign nations, the bloody UN and a general idea that we should follow rules. No, doesn't matter to him, he understands that being cunning is part of it but brute force always wins. The Vikings knew it, the Spanish and so on. Impose your will on others with force, not digital currency, grand ideas or brilliant thinking.

The other issue with bitcoin is we cannot forget numerical advantages will always win. There just plain is not enough bitcoin or will ever be if nothing changes to over take the fiat system to any degree to impact the world. It doesn't help the vast majority are held by a small group either. It also doesn't help the government can create out of thin air where as a bitcoin is limited. So you have a potentially infinite force on one side vs a limited one, it cannot win.

Now in saying all that I still like the thought of it, it will impact how our financial services function from here on out and if you can make a buck along the way, good for you. But a revolution, we'll see.

offtopic but answering cryptodomains response
salt and wooden sticks failed because anyone could gather them and there was unlimited supply. (bad)
FIAT, anyone can gather but governments control supply.. still unlimited but governments control it (an improvement)
bitcoin anyone can gather, limited supply. supply not controlled by anyone. (better)

getting the government as it exists now to use bitcoin i totally do not want, nither does anyone else.

but imagine it this way,
imagine if hospitals have bitcoin addresses. and bitcoiners decide instead of cashing out to fiat (incurring tax) they decide they will pay 1% of bitcoin income to the hospital where the hospital can see that a person has paid X amount to cover any future health issues.
the police, fire, courts etc.. all these services have addresses too and we put 1% into each of those.

with all the needed services covered to ensure a happy and healthy lifestyle totalling maybe 20% of our income at most. then the question really is... do we need all of those paper pushing government workers that do nothing to help us live happy and healthy lives..

thus using our wealth to drain the government into a more sleak and robust system that works for us.. rather then us working for them

we may even find that once we kill off the dead weight 'do-nothings' that take a salary from the taxes, we will hopefully see that to fund all of the essential public services only cost 10% or lower of our income,

What if the government decided to have a cashless society. Just creating digital currency out of nothing, backed by nothing and just given a value...

Just like paper money, they could, kind of already do and we will accept it or die.

This whole bitcoin theory of breaking free from government chains blah blah blah is nice and dandy but ultimately the one's with the gun's win, not the one's with the altcurrency.

Bitcoin will survive in some respect but used by a government to further control the people, not promote freedom, sadly this experiment of sorts is not good for us at all really. I believe the government is the creator, not some hero free thinker who wants us to be free.

Just my opinion, a bit off the topic and a downer but we need to remember before bitcoin there was salt, wooden sticks, genuine trade and so on. None of those stood up to government and a digital currency is even less likely.  And before you start on how advanced and technical bitcoin is and how it works and it is far from a wooden stick with notches, it isn't . At  the end of the day it is simply a tool given value by people no matter how it is created, shared, spent or sold. If tomorrow we all agreed to use spoons for commerce guess what, do we think we'd take our financial freedom back with spoons? It has as much of a chance.

Don't misunderstand me, bitcoin has many advantages in other terms, fee's, privacy and so on but it's ultimate battle is with big brother and their currency and financial system. Cheaper transfer fee's and all it's technical wonder will never compete with a drone or regulation.

OP please ignore the noob miners as they seem to be missing th points your making and only thinking about how would they make money on your network.. greedy beggers..

but getting to your point. if western union replaced their database for a blockchain. and it was on their closed network. then this is what they would need to do. copying bitcoin, is called making an altcoin.

1) have the altcoin that will make a few billion coins, with the half life being days not years. so that western union can premine all the coins in a week, mining with just 2 computers both belonging to them.

because its a closed network of theirs. there wont be any forks or worry of 51% attacks, as there is no competition for coins, its just them. so there is no reason to attack themselves.

2) they then distribute a client program to all western union offices around the world

3) the peg each coin to be worth a dollar or a some other pegged value. and then they can use the blockchain as their ledger/database/accounts system.

the 2 computers owned by western union continue mining transactions with zero reward, and the transactions need zero fee.. all because its all owned by western union. things to note:
th altcoin would need to generate coins at first. just to have coins as a vessel to use as a comparison for FIAT. but as said in (1) it can all be premined in days. then the rest of the decades/centuries that WU uses the blockchain they are not generating coins, just using the coins they premined to move 'value' from one office/city/country/to another.

Would there be transaction fees? If so, then isn't that what Bitcoin will turn into once the block reward drops to insignificance?

When you say "private network", do you mean a distributed trustless system, or is it a ledger owned by the company that created it? If the latter, there is no need for the proof-of-work system and they can just trust themselves to update the ledger honestly.

What I hear you saying is, "What if big banks used a private network to make cash transfers that is based off of a fast and quick and efficient blockchain instead of the slow and clunky and expensive system we have now?"  Is that correct that this is what you are trying to ask?

Now I am an amateur to crypto-currencies and don't understand everything, but I think the system you are describing is called Ripple.  That is IF IF IF Ripple can get major banks to act as gateways and build "trust" in its network.  The Ripple that exists and is usable today is a joke.  

The major resistance to your idea is that the crypto-currency community is fanatical about decentralization.  If you have one company running the markets, chances for abuse exist.  

apples and oranges.  Fiat and crypto are universes apart and they generally don't mix. 
Fiat ultimately relies on cooperation between central banks as the trusted third parties
to digitally transfer the money.  How does 'mining' or 'a network' mesh with this?
I can't see it.

You received money, now how do you place that cash into your digital system?
Generating coins produces something that can be transferred.
What will you send and how?

You're missing incentive to maintain a large, active peer to peer network.

Bitcoin operates as it does because hundreds of nodes are active at any given moment, verifying, comparing, correcting, and cementing transactions.

Also, the bitcoin network is not recommended for fiat style transactions because of the potential for a blockchain to fork.

If this were to happen with your example, Western Union, a forked chain could misplace hundreds of thousands of dollars in transactions.

Secondly, transactions across the bitcoin network do NOT happen in a timely fashion. blocks are verified as new transactions are discovered, and incremented. Sometimes verification (at least six blocks deep) can take up to an hour. Western Union transactions are verified and the deposits accessible within minutes.

SHA-256 blockchain generation is completely unsuited for your purposes. It is much simpler to rely on client-server transaction verification.

Now, peer to peer transaction processing within the network would increase propagation speed in this instance, but not greatly improve security.

Blockchain based transactions
   Slow to verify
   Susceptible to forks and double spends when hashpower is insufficient
   Work mainly on incentive to provide hashpower.

Client-server / peer to peer client to server
   Quick to verify transaction
   Susceptible to infiltration
   Rely on centralized recordkeeping to lower client overhead.

This came to mind tonight, and I am sure someone can poke some holes in this a million times. That is what I am hoping for to give me a better understating.

I am going to use Western Union for this example, and that type of service.

Mining is used to generate new coin and also process transactions, if so desired.

The network adjusts difficultly to maintain a steady time frame of when new coin is generated but more importantly how often transactions are processed. (or do I have this backwards?)

What if a company created a private network, based off the same concept, but eliminated the coin generation and used it for cash only transactions. The difficulty  would maintain a constant, and the transactions would happen on a timely manner.

The only thing that would have to be implemented is a proof of work, or in this situation a proof that the actual cash was received before it could be processed to any corner of the world.

What am I missing? I am sure it is something.

Thanks for reading.