A question about long term Feasibility of Crypto currency

[Indus Monk]

DISCLAIMER:

(Open This Spoiler at your own Risk!)

Spoiler

I AM NOT ASKING ABOUT HOW CRYPTOCURRENCY WORKS!

 

I AM NOT ASKING ABOUT HOW TO MINE CRYPTOCURRENCY EITHER!

 

(All Spoilers are safe now!)

 

A Classmate of mine actually deals in bitcoin currency and other Cryptocurrencies. With the recent rise in value of bitcoin, he has seen a significant rise in household income. Which he poured into a new car and a new motorcycle. i told him about Ethereum, but he knew nothing about it. 

 

However, he did say something that was very interesting.

Spoiler

All Cryptocurrencies will be worthless by 2020.

The question is, HOW?

 

One more thing:

Spoiler

Maybe he made this statement with Indian context in mind? Since we live in India.

Fun Fact:

Spoiler

Even before the crypto currency craze the 4GB RX480 by PowerColor with a REFRENCE COOLER was being sold for about $300 on Amazon.in!

 

[MrMarriarty]

Cryptocurrencies  NO

[Indus Monk]

Just now, MrMarriarty said:

Cryptocurrencies  NO

But did you even read my full post?

[knightslugger]

The head of McAfee Security feels differently. He sees BTC value at a staggering level beyond 2020.

[MrMarriarty]

3 minutes ago, AmbarChakrabarti said:

But did you even read my full post?

I did, Cryptocurrencies  just make me sad, and yes they probably will be a limited thing as more powerful PC's become avaliable the weaker it will be . When intel and amd start doing quantum chips not just DWAVE bang your Cryptocurrencies is worthless

[Indus Monk]

1 minute ago, knightslugger said:

The head of McAfee Security feels differently. He sees BTC value at a staggering level beyond 2020.

If you have a source to back this up, can you paste a link here?

[knightslugger]

Just now, AmbarChakrabarti said:

If you have a source to back this up, can you paste a link here?

https://www.cryptocoinsnews.com/john-mcafee-claims-bitcoin-will-worth-500000-three-years/

[Indus Monk]

1 minute ago, MrMarriarty said:

I did, Cryptocurrencies  just make me sad, and yes they probably will be a limited thing as more powerful PC's become avaliable the weaker it will be . When intel and amd start doing quantum chips not just DWAVE bang your Cryptocurrencies is worthless

This is plausible.

 

Because i see mining CryptoCurrency in the same light as Folding@Home. With folding, we are starting to run out of work units as well. (or maybe we have already).

So maybe cryptocurrency will meet a similar fate

[MrMarriarty]

1 minute ago, AmbarChakrabarti said:

This is plausible.

 

Because i see mining CryptoCurrency in the same light as Folding@Home. With folding, we are starting to run out of work units as well. (or maybe we have already).

So maybe cryptocurrency will meet a similar fate

if you want to use up free processing time for usefull things 

http://lhcathome.web.cern.ch/

[The Belgian Waffle]

Well, I think it depends on what the governments do about it.

Traditional currencies, so Euro, USD etc have their value guaranteed by a bank (the fed in the US I believe, the European Central Bank in Europe) that basically says "this piece of green paper is worth a certain amount of money", and this won't because no matter what will happen, 5 euros will always be worth 5 euros
On the other hand, if I'm correct, there is nothing that guarantees cryptocurrencies' value.

Also, inflation. At one point or another, it's going to fall down. It has happened with more traditional currencies, so it will most likely happen with crypto

[Tellos]

The Belgian Waffle Another issue is China is already heavily regulatgn Bitcoin and how much can leave the country at any time. Once this all gets governed by states like China it won't mean much as they do not want wealth leaving their country. 

[pat_13b]

Just to counter some of the above points:

 - Currencies like the euro or USD only have value because people agree that they have value. Same applies to Bitcoin. I don't see how being backed by a central bank that says "this piece of green paper is worth a certain amount of money" makes it better. Particularly when that central bank can manipulate the currency and severely screw up an economy. The supply of Bitcoin is known and and unchanging. People like stability. The fact that Bitcoin's inflation is declining (predictably) is a feature, not a bug. The alternative is that your USD, Euro, JPY gets "inflated into oblivion".

 

 - China can try and regulate bitcoin to stop people shifting money out of the country but in reality, how can they? People can just write the code for their own wallet from scratch or memorise the 12 word phrase/mnemonic and just generate their wallet across the boarder. Bitcoin gives people freedom.

 

 - Although I don't understand or know the technical details, my understanding is that the he system is already quantum computing attack resistant and the protocol can be upgrades if it needs to increase resistance.

 - Bitcoin technology evolves over time. Every part of the system will become better, cheaper and faster.

[Tellos]

@pat_13b ok one nobody has made resistance to quantum computing attack cause few companies even have ones in use as test benches. Second China moniters all these things and if you move too much out you get arrested. Also to move Bitcoin you must make a trail via the exchanges Chinese officals merely watch those and all those are filed with the government. So if you move too much they WILL march to the Chinese citizens hosue and arrest them. By not understanding the technical part you know nothing. Also recently hackers managed to steal a massive chunk of Ether from people by hackign their website they used to exchange Ether for THEIR crypto currancy. 

[Indus Monk]

11 hours ago, Tellos said:

@pat_13b ok one nobody has made resistance to quantum computing attack cause few companies even have ones in use as test benches. Second China moniters all these things and if you move too much out you get arrested. Also to move Bitcoin you must make a trail via the exchanges Chinese officals merely watch those and all those are filed with the government. So if you move too much they WILL march to the Chinese citizens hosue and arrest them. By not understanding the technical part you know nothing. Also recently hackers managed to steal a massive chunk of Ether from people by hackign their website they used to exchange Ether for THEIR crypto currancy. 

 

On 8/15/2017 at 7:34 PM, pat_13b said:

Just to counter some of the above points:

 - Currencies like the euro or USD only have value because people agree that they have value. Same applies to Bitcoin. I don't see how being backed by a central bank that says "this piece of green paper is worth a certain amount of money" makes it better. Particularly when that central bank can manipulate the currency and severely screw up an economy. The supply of Bitcoin is known and and unchanging. People like stability. The fact that Bitcoin's inflation is declining (predictably) is a feature, not a bug. The alternative is that your USD, Euro, JPY gets "inflated into oblivion".

 

 - China can try and regulate bitcoin to stop people shifting money out of the country but in reality, how can they? People can just write the code for their own wallet from scratch or memorise the 12 word phrase/mnemonic and just generate their wallet across the boarder. Bitcoin gives people freedom.

 

 - Although I don't understand or know the technical details, my understanding is that the he system is already quantum computing attack resistant and the protocol can be upgrades if it needs to increase resistance.

 - Bitcoin technology evolves over time. Every part of the system will become better, cheaper and faster.

 

On 8/14/2017 at 8:14 AM, The Belgian Waffle said:

Well, I think it depends on what the governments do about it.

Traditional currencies, so Euro, USD etc have their value guaranteed by a bank (the fed in the US I believe, the European Central Bank in Europe) that basically says "this piece of green paper is worth a certain amount of money", and this won't because no matter what will happen, 5 euros will always be worth 5 euros
On the other hand, if I'm correct, there is nothing that guarantees cryptocurrencies' value.

Also, inflation. At one point or another, it's going to fall down. It has happened with more traditional currencies, so it will most likely happen with crypto

 

On 8/14/2017 at 8:00 AM, MrMarriarty said:

if you want to use up free processing time for usefull things 

http://lhcathome.web.cern.ch/

 

On 8/14/2017 at 7:57 AM, knightslugger said:

https://www.cryptocoinsnews.com/john-mcafee-claims-bitcoin-will-worth-500000-three-years/

 

 

So today was one of those rare occasions where that classmate of mine was Present. During Lunch I asked him to explain to me why he made that statement. He said;

 

"Bitcoins will be worthless by 2020. Because, you can only mine so many of them"

 

What i understood was:

Spoiler

 

Bitcoins can be earned by mining. We mine some resource, such as Ethereum, and exchange it for CryptoCurrency such as Bitcoin. Just like real life, you can only mine a limited amount of coal from a coal mine. Which means that we can only mine so much ethereum. So eventually, ethereum runs out, mining dries up, and cryptocurrency becomes less feasible. Unless someone comes up with something that can substitute ethereum.

 

 

 

IF YOU USED TO FOLD:

Spoiler

You were assigned work units, (WU). By folding, you use your GPU/CPU power to complete the task in the WU. Once that WU is completed, all data is sent back to the main server, which gave us that WU. Then, the server will provide you with another WU, and the cycle goes on. However, these days, WUs are much fewer in quantity and should be almost finished.

 

I guess mining is similar to folding. but unlike mining, You DON'T Earn money from Folding. However, folding was used primarily to develop medicines and run complex simulations.

 

PS: Is there any mistake here? Let Me Know! I will edit this post!

Edited August 17, 2017 by AmbarChakrabarti
I was trying to put the Quotes in Spoilers! But i can't

[The Belgian Waffle]

21 minutes ago, AmbarChakrabarti said:

Very big snip

Why is your friend saying that there is a limit? Since you earn money by lending your hardware to the network in order to do the transactions, there's no physical material that's disappearing, right? So why would we run out of things to mine?

[Indus Monk]

43 minutes ago, The Belgian Waffle said:

Why is your friend saying that there is a limit? Since you earn money by lending your hardware to the network in order to do the transactions, there's no physical material that's disappearing, right? So why would we run out of things to mine?

That unfortunately i cannot explain.Partially because;

 

i will have consult someone who has thorough knowledge of Cryptocurrency and programming along with a DEGREE in programming or a DEGREE in computer science.

Though my best friend will graduate by 2018 with a degree in Computer Science, i doubt he can answer these questions properly, since not everyone has equal knowledge.

 

But mostly because:

 

I am not from a science background, neither my parents nor my siblings have a science background. They ALL are from an Arts background, including me. And also, I SUCK at maths. i scored 60 out of 100 in ALL subjects (including maths) because the teachers had mercy on me.

 

PLUS:

The internet cannot be considered as a reliable source. Because anyone can pose as anybody and deceive or misguide us

[The Belgian Waffle]

15 hours ago, AmbarChakrabarti said:

That unfortunately i cannot explain.Partially because;

 

i will have consult someone who has thorough knowledge of Cryptocurrency and programming along with a DEGREE in programming or a DEGREE in computer science.

Though my best friend will graduate by 2018 with a degree in Computer Science, i doubt he can answer these questions properly, since not everyone has equal knowledge.

 

But mostly because:

 

I am not from a science background, neither my parents nor my siblings have a science background. They ALL are from an Arts background, including me. And also, I SUCK at maths. i scored 60 out of 100 in ALL subjects (including maths) because the teachers had mercy on me.

 

PLUS:

The internet cannot be considered as a reliable source. Because anyone can pose as anybody and deceive or misguide us

Don't consider yourself retarded on a particular subject because you've got bad grades  

[Unimportant]

On 8/14/2017 at 4:55 PM, MrMarriarty said:

Cryptocurrencies  just make me sad.

Before you say that, you'd do well to research how our current fiat monetary system works, how all fiat monetary systems fail and result in war and poverty. How governments use it to constantly steal from their citizens (including you), how fiat is used to fund endless wars, which would simply be impossible with hard currency and I could go on for a while.

 

If you're sad about the "wasted" processing power like many seem to be, remember that our current fiat monetary system also "wastes" lots of processing power. Or do you think all those bank servers/terminals/security runs on air ? Not to mention physical waste, wasting fuel to haul armored cash vehicles around, etc.

[Unimportant]

On 8/14/2017 at 5:14 PM, The Belgian Waffle said:

Well, I think it depends on what the governments do about it.

Traditional currencies, so Euro, USD etc have their value guaranteed by a bank (the fed in the US I believe, the European Central Bank in Europe) that basically says "this piece of green paper is worth a certain amount of money", and this won't because no matter what will happen, 5 euros will always be worth 5 euros

You seem to be a little confused. 5 euros will indeed always be 5 euros, but it's value will change, that results in changing prices...

What good is it if 5 euros remain 5 euros if the price of a  bread rises to 100 euros because the value of a euro collapses.

 

Also, central banks don't guarantee the value of curreny, they openly guarantee it will lose value!. They don't even hide this! The stated goal of many a central bank is 2% inflation (value loss) per year, and they actively work (print money) too achieve it (thereby stealing value from currency holders, most not even realising they're being robbed).

 

The entire idea behind it is that if money holds value ppl hoard it and the economy will grind to a halt, so money needs to lose value so ppl spend it, not because they need what they buy, but because they want to get rid of the money before it loses more value.

The biggest ball of bullshit ever offcourse, asif ppl will not buy food because next year it will be cheaper and need central bank intervention to make sure the price of food rises.

Ppl will indeed buy less stuff they don't really need if money were to hold value/rise in value - which means the current system encourages waste.

[Unimportant]

On 8/14/2017 at 4:45 PM, AmbarChakrabarti said:

DISCLAIMER:

(Open This Spoiler at your own Risk!)

  Reveal hidden contents

I AM NOT ASKING ABOUT HOW CRYPTOCURRENCY WORKS!

 

I AM NOT ASKING ABOUT HOW TO MINE CRYPTOCURRENCY EITHER!

 

(All Spoilers are safe now!)

 

A Classmate of mine actually deals in bitcoin currency and other Cryptocurrencies. With the recent rise in value of bitcoin, he has seen a significant rise in household income. Which he poured into a new car and a new motorcycle. i told him about Ethereum, but he knew nothing about it. 

 

However, he did say something that was very interesting.

  Reveal hidden contents

All Cryptocurrencies will be worthless by 2020.

The question is, HOW?

 

One more thing:

  Reveal hidden contents

Maybe he made this statement with Indian context in mind? Since we live in India.

Fun Fact:

  Hide contents

Even before the crypto currency craze the 4GB RX480 by PowerColor with a REFRENCE COOLER was being sold for about $300 on Amazon.in!

 

The truth is, nobody can know.

If it continues to grow and reaches mass mainstream adoption it will get a whole lot bigger. The current cryptocurrency market cap is still smaller then apple, 1 single company on the face of the planet. A large company, but still only 1 single company. If crypto reaches mass mainstream adoption around the planet it could get a lot bigger then that.

 

On the other hand, governments could try and move against it. It would be hard because cryptocurrencies are decentralized, with no central point to attack. Still, heavy taxation, harassment of exchanges and so on could cause it to move underground and stop growing/shrink - no-one knows.

 

There could be a fatal bug in one of the cryptocurrencies that causes it to become worthless. That won't be the end of all cryptocurrencies but you won't care if it's the currency you happened to own.

 

Cryptocurrencies simply started as a experiment to create competition to the current system of government controlled, centrally managed (meddled) fiat money. Which I deeply applaud because fiat monetary systems are the road to hell. But it remains a experiment, even the original creator(s) don't really have control over it anymore (that is the point, nobody controls it, not even the creator - you do not need to trust a central planner). No-one knows how a experiment will end.

[Unimportant]

On 8/17/2017 at 4:09 PM, AmbarChakrabarti said:

 

  Hide contents

 

Bitcoins can be earned by mining. We mine some resource, such as Ethereum, and exchange it for CryptoCurrency such as Bitcoin. Just like real life, you can only mine a limited amount of coal from a coal mine. Which means that we can only mine so much ethereum. So eventually, ethereum runs out, mining dries up, and cryptocurrency becomes less feasible. Unless someone comes up with something that can substitute ethereum.

 

 

 

 

 

When the mineable supply dries up (no more coins to mine) the miners will be paid by transaction fees, this already happens today.

The mining difficulty is directly related to the network's processing power and transaction fees also change based on how busy the network is and so on.

This results in a self-regulating system that will increase the reward for mining if there's not enough processing power available and vice versa. This should make sure it's always worth mining - for some.