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Strategies & Market Trends : Blockchain and Cryptocurrencies -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (339)	1/24/2018 10:17:19 PM
From: Elroy	Read Replies (1) \| Respond to of 7632

"Bitcoin mining" is the activity of managing the global bitcoin nework. The people that run the servers that run the Bitcoin code and maintain the bitcoin blockchain are called miners. Miners receive bitcoin when they discover the next block (in the blockchain) and they also receive all the transaction fees that are contained in that block. There are lots of miners, but over time it has become more centralized with some mining pools having a larger than expected share of the mining/processing power. The original code for Bitcoin fixes the number of coins that can be created at 21 million. There are currently about 16.5 million bitcoin in existence. I've heard the 21 million number is expected to be reached at around 2040. Once the 21 million number is reached, miners will no longer receive bitcoin for discovering the next block, they will only receive transaction fees. How on earth is one to use a coin that is worth, e.g., $50k You're thinking of Bitcoin as a currency now. How on earth does one use 50 gold bars that are worth $10 million? You don't use them, you store them. They hold your wealth. In my previous post I wrote about how Bitcoin is desirable as a store of value, not as a normal daily use currency. The way Bitcoin is going it doesn't seem like it is heading in the direction of being a fiat currency. There are other crypto currencies trying to grab that market space. But all the things I wrote about Bitcoin (easy international unregulated transfers, easy to store/maintain compared toi other "valuable" stuff, etc.) all apply. Bitcoin can be denominated into manageable portions. One Bitcoin is now about $11,000. You can easily buy 0.001 Bitcoin which is of course worth $110. You could buy 0.0001 Bitcoin for $11. If you have to exchange it for "fiat currency" to use it, you are still at the mercy of inflation. The fiat currency is at the mercy of inflation. And what are all these other cryptocurrencies? Aren't they creating new currencies? Don't they dilute each other? coinmarketcap.com They all try to do different things. Some try to be Bitcoin but better than Bitcoin. Others try to be daily use currencies. Others try to be distributed programming systems, others try to do other stuff. To succeed they need to both work/function, and gain reasonably widespread adoption. Many are working well, and have market cap values in the billions of dollars. In theory one of the new crypto currencies could do what Bitcoin does, but do it better, and become more widely adopted than Bitcoin, and then yes, that newer better Bitcoin would devalue Bitcoin. Sort of like what Google did to Yahoo. I think the general view is that similar to the internet stocks of the 1990's, most of them will fade away and die (pets.com, Alta Vista, etc.), but a few will become massively important in the coming years (Amazon, Google). We're in the first inning at the moment, it's interesting to watch.