Cost me over $4 to send Monero transactions last month. Cost me about $3 to send a Bitcoin transaction this morning. The average and median transaction fees between the two networks have been pretty close for a while
I like Monero but it has some way to go - it needs a light client, multisig completed, and hasn't really had to confront any scaling issues yet (already at 30GB+ blockchain with 4-5k transactions per day).
At the same time the other cryptos are progressing rapidly on the one huge advantage Monero has - Ethereum has added zk-SNARKs and there are all sorts of proposals and developments on Bitcoin now that malleability has been addressed and the new opcodes added
edit: also re: Bitcoin News - most of what I read is about the ongoing Segwit2x saga, but it's a bit difficult to avoid the price when it is on such a tear
This isn't much of a surprise after looking at some of your prior comments regarding Bitcoin. A few gems:
> Yeah, imagine using Netscape in 2017 and not Chrome - that's pretty much how I look at Bitcoin.
> Thanks, but no thanks! I'd keep as far away from this stinking pile as possible!
> Mere mortals do not have Bitcoin and are not interested in it - at all.
> everything you can say about Bitcoin, you can say about land as well - it's scarce, but unlike Bitcoin, it has a real utility.
> the conspiracy theory that CIA/NSA created Bitcoin to catch crooks now makes more sense than ever.
> I don't believe in Bitcoin, which is majorly driven by low-class Chinese speculators and exchanges!
patio11 is that you in there?
Bitcoin's use-case is not microtransactions or payments among friends. It is providing secure and trustworthy payments when no trusted third party exists, independent of governments, companies, etc.
2. Owning bitcoin incurs only the environmental toll for the initial transfer into your wallet. If the $0.50 of electricity used to validate your initial transfer bothers you, buy some carbon emissions to offset that. But you probably waste much more electricity leaving Halo on pause for 10 minutes while you grab a snack.
3. If you think Chinese enterprises are immoral (which I would love to hear your reasoning on if true), then don't buy bitcoin from a Chinese enterprise. They don't have a monopoly on the currency.
Also, what do you mean by "low-class investment"? Do you mean high risk? The definition of investment is: "a thing that is worth buying because it may be profitable or useful in the future."
Given the track record of Bitcoin, I would say that so far it has proven to be a very good investment for any who have bought it so far. It's hard to argue with history.
Or maybe you are claiming to have knowledge about why the years-long trend of bitcoin growth will cease soon? Has something fundamentally changed about it recently?
B) ZKSnarks will never deprecate XMR, they bring the caveats of trusted being required, inability to audit coin supply and inherently DO NOT provide fungibility.
It’s no wonder xmr price is in the doldrums. Even the smart guys on HN are misinformed about it.
Correct me if I'm wrong, but why couldn't you just decrease the fees you used? Monero has an adaptive blocksize, and transactions won't really get dropped if you used very low fees (unless you are very unlucky)
The mining dynamics are very different than Bitcoin in a way that it adjusts the blocksize to keep TX costs low. This isn't scalable but looks like they are working on it. (Search for 'hyc' on reddit and monero forums). I still haven't completely understood all of it, but here's[1] an explanation.
I might be wrong, but isnt the fee based on how much of the currency that you're sending?
Like, how much were you sending for each currency? If the amounts werent similar, the fees might not be accurate for similar amounts
Proof of Stake is far superior and Delegated Proof of Stake is another step up from that.
Delegated proof of stake is more resistant to forks since it's easier for delegates to reach consensus on decisions.
It is useless as a global currency now, and any more complicated smart contracts built on top of it need trust in a third party, eventually, if it's ever built.
All it has left for it is brand recognition and large transactions as a settlement network.
The current price increase is obviously because people need to be in Bitcoin before this upcoming attack. Because if there is a back and forth fight over the hash power, you won't know who is the winner immediately.
Cardano was founded by the same people who originally founded Ethereum, and they also maintain Ethereum Classic. Their team has leading computer scientists and cryptographers on board, such as Phil Wadler. It addresses all the shortcomings of Bitcoin and Ethereum and is based on scientific research instead of hacking.
Better to leave random warehouses in China to control the entire pool? How does supporting asics matter in the least other than making it less accessible?
In the short term, true. The same could have been said of integrated circuits at one point. ASIC manufacturing will become cheaper and easier.
I use Bitcoin from time to time to order food and buy other stuff online (sometimes through gift cards bought with Bitcoin). It's tough enough to find sites that accept Bitcoin, but I don't think I've ever seen one that accepted Monero or Ethereum. Maybe Litecoin a few years back. I admit that I haven't searched, but I would have expected a correlation with Bitcoin-accepting sites.
So if it's not buying stuff, what use cases do you have in mind?
A) Barriers to initially acquiring crypto coins remain a bit high. B) Expense of transactions remains way too high, C) Transactions are way too slow, and D) For Bitcoin in particular, the hoarders make it politically difficult for Bitcoin to move to an algorithm that can produce faster transactions and therefore serve as a better means of payment.
All the major blockchains in the cryptocurrency ecosystem, right now, are too slow and expensive to be of much use as a currency to the global economy. It stands to reason that if one of them, unburdened with Bitcoin-holder demands for ever-increasing scarcity, solves that problem (Proof of Stake?), then Bitcoin will be supplanted by a cryptocurrency that improves the currency experience. Several are in the process of fixing that, while Bitcoin is not.
No cryptocurrency's competition is Bitcoin. The competition is old school means of payment. If your currency becomes closer than Bitcoin to being as useful as traditional money, your currency will have an advantage over Bitcoin.
Imagine you sell a phone on Craigslist, for crypto. You and the buyer can either deal with a $10 fee and 30 minutes to an hour of sitting in a Starbucks to complete your transaction, or you can give up, swap cash for goods, and walk away. Which one do you choose? Time is expensive, too.
That’s what I never understood about small bitcoin purchases.
The way I see it, an unconfirmed Bitcoin transaction is still more trustworthy than a confirmed debit card transaction. At least with Bitcoin, I'm 100% sure the person has the money in the first place, and that once the transaction clears (in ~10 minutes), they can't reverse it later and stick me with the loss.
I think you didn't read the context. My post was concerning actual, current use cases, not speculations about a hypothetical "conclusion".
If you're interested in adopting Monero, but still need to be able to pay in Bitcoin occasionally, you can use a service like www.XMR.to
If its going to be worth more tomorrow, you probably don't want to trade it for something today.
The use case for bitcoin is the same use case that makes up 95% of the price of gold - its predictably scarce. Thats its value.
Yes. Exactly how US dollars cannot function as effective "buying an iPhone" currency since they are deflationary: In a year, the same amount of dollars will get me a better iPhone, or more iPhones of the same quality.
This super-simplified deflation argument is mostly bullshit, no matter how often it's repeated in economics textbooks. People have needs, and they are fine with fulfilling some needs later, but others they want fulfilled immediately.
Secondly, the inherent deflationary nature of Bitcoin has not yet come to pass. Coins are currently being mined at a rate of 4% per year, halving about every 18 months. Once the inflation rate for Bitcoin goes negative, only then will we be dealing with a truly deflationary currency. It only seems deflationary now because the demand for Bitcoin is drastically outpacing the rate at which it's being inflated.
Finally, the inability of the state to inflate Bitcoin at will is the point. If you want to keep your capital in a state-controlled inflationary currency no one is going to stop you. What I and others in the Bitcoin community believe will happen is that "bad money will drive out good". People will spend their dollars and hoard their Bitcoin, as they will understand that dollars will be worth less and Bitcoin more in the future. The only way to stop that from happening will be a drastic reduction in the number of dollars in circulation... which again, is kind of the whole point for many of us.
> The use case for bitcoin is the same use case that makes up 95% of the price of gold - its predictably scarce. Thats its value.
That's one use case, yes. It's not the only use case.
In fact the richest people I know are all negative USD, and very positive everything else (especially real-estate), because they borrow USD to invest. The poorest are also negative USD, and holding only liabilities with little assets. It's only the ones in the middle that are positive USD. Basically not rich enough to buy real-estate (or not interested), but certainly not poor either.
May I ask you a question: would you borrow Bitcoins to, say, buy a plot of land in the middle of Arizona, plant vines and start making wine? This is why as far as I am concerned I don't see Bitcoins as any sort of competition to USD, EUR, JPY, etc. It's just yet another asset that may or may not prove to be a good investment in the long run. I hold some, just in case.
Unless you need it.
This graph is evidence against that theory:
https://bitinfocharts.com/comparison/transactions-btc-eth.ht...
Note that Bitcoin's tx volume hasn't been able to increase since the blockchain reached its 1 MB limit. Otherwise it would have seen continued growth like Ethereum.
The real, better cryptocurrency will probably be a stable token running on Ethereum.
For me, that's generally things like gift cards, VPN and VPS rentals, etc. It also seems to be gaining significant traction on porn sites, both for memberships and for per-artifact transactions. I expect that it will continue to be useful in the case of memberships in particular because you can't set up a recurring payment in Bitcoin, which protects the purchaser from being unexpectedly charged later.
> I don't think I've ever seen one that accepted Monero or Ethereum. Maybe Litecoin a few years back.
I agree here. Although I've seen a few, they're all very much amateur sites run by other crypto nerds, so they don't really count.
That said, I don't think that matters so much anymore. Sites like shapeshift.io have made it nearly effortless to move between cryptos, so if you want to hold and transact with friends using Monero and buy things using Bitcoin, there's much less friction than there was a year ago.
> So if it's not buying stuff, what use cases do you have in mind?
In my view, here are the main use cases for Bitcoin:
1) As a currency/"digital cash". There are definitely use cases (see above) where Bitcoin is a superior currency. There are also instances where people cannot transact using the "normal" financial system, and Bitcoin gives them the ability to purchase things online. Examples include minors and citizens of states without great access to the world financial network.
2) To evade state control. I've personally got a friend in Venezuela that I occasionally send some Bitcoin to help with family matters. Their currency is literally worth less than WoW gold at this point, and the state controls the dollar:bolivare exchange rate. I'm able to send him $50 in Bitcoin and he's able to exchange it for food and medicine, or for bolivares at a rate many times better than the "official" rate. Likewise, it seems that the Chinese are using Bitcoin (and other cryptos) to evade capital controls and get their assets out of China.
3) As an investment. The long-term deflationary nature of Bitcoin means that it's an excellent place to keep "disposable savings" - so long as you believe in the future of the currency.
4) Complex but bulletproof financial planning. My cold wallet is set up using m-of-n. There are several private keys out there to it: I have one at home in my safe, one in my head, one on a Yubikey on my keychain, my wife has one, my attorney has one, my parents have one. Three of those six keys are required to sign a transaction for it to be valid. That means that no one individual, other than me, with access to those funds can spend them on their own. If I die unexpectedly, my wife can spend them. If we both die unexpectedly, my parents can spend them. If somehow I, my wife, and my parents all die unexpectedly in very short order, the funds can still be recovered by the executor of my estate. This sort of arrangement cannot be made in the traditional financial system without exposure to litigation risk.
Another place it would make sense is in a corporation with strong spending controls. A wallet where the CEO, CFO, and CSO all must sign off on a transaction is totally possible. That wallet is then 100% guaranteed not to ever be spendable by anyone outside of official channels. There is also a public record of who signed each transaction and when for audit purposes
5) Asset verification. Do you know, for sure, how much gold is in Fort Knox? Of course not, we must simply trust that the US government isn't lying when they state the size of their reserves. With Bitcoin, if an organization has 20,000 BTC sitting in a wallet, they can sign a message to that effect with the private key that corresponds to it. That signature can then be verified by anyone, and we can be confident that they do in fact control the coins at that address.
As far as I know my sending money to my friend is not illegal under US law, but it is illegal for my friend to use it. That's what I meant by "evading state control" - those of Venezuela, not the US. I'm not terribly concerned about the Venezuelans coming for me :)
Of course, the US dollar has the whole US economy and the biggest army in the world as its plus, but it also has its minuses: the US treasury can and does print as many as it wants, in the detriment of ALL USD holders.
Bitcoin's pluses when comparing it to other crypto currencies are:
- the first to market advantage
- almost 9 years of virtually 0 hacks of the protocol or concept
- no sudden moves
- the whole ecosystem that formed around it
- etc.
Let's not forget - ETH is less than 3 years old, Ripple is centralized, Litecoin, zCash, Monero and most of the others are bitcoin forks.
Except fiat currencies also have that fiat behind them that gives them value. If you want to do business with the US government, you do it in USD. If you are one of the millions employed by the US government, you are paid in USD. If you manipulate USD, you have to answer to the US government. Those things add tremendous value and they are something that Bitcoin does not have.
With Bitcoin you only have trust in value of Bitcoin. Fiat currency is given added value by having trust in the power, reach, and stability of the nation that issued it.
More specifically, you have trust in the continued trust that others have in it. It's a self-fulfilling prophesy: as long as people continue to trust it, it continues to be valuable, but as soon as people start to doubt that others will continue to trust it, it's instantly worthless. There's no real value backing it up. This makes it very vulnerable to hype and hysteria.
In the 70s we made a number of agreements with a variety of Mideastern nations. We gave them what seemed like the world and asked that simply require payments of oil to be transacted on the dollar, and that they invest their excess revenues into US securities. In fewer words, the petro dollar.
And those agreements, for the most part, persist to this very day. A US dollar guarantees you access to oil. And so long as oil is the most in demand commodity in the world, the US dollar will remain the most in demand currency in the world - guaranteeing access to the goods and services of any country.
This is why the US dollar is the world reserve currency, or the money most countries keep under their bed in case of a rainy day. However, if this changes (renewables, Saudi Arabia deciding to switch allegiance to Russia/China, etc) what happens? We've a lot of debt that's only increasing and it's unclear to me how tall the USD would stand without its crutch.
Bitcoin, by comparison, isn't used for everyday transactions by a lot of people (though there are some). There's no real economy it's native to (unless you count Silk-Road-style markets), and there's no guarantee that you'll be able to use it there in the future.
Ultimately it seems that any material you treat as a store of value, rather than as a commodity or material that is valuable to you for its own properties, includes this trust that others will value it. If others do not value it, it is not a store of value, its usefulness to you is reduced to its own intrinsic properties rather than the value others place on it.
It might be trust that you can't double spend BTCs, trust in the issuing algorithm, trust that you can only lose your bitcoins if you do something stupid with your wallet, etc.
Of course, we can't compare right now bitcoin's ecosystem with the ecosystem of the fiat currency, but who knows what will happen in the future if more and more people and businesses choose to adopt it.
The Fed themselves wrote an article [2] expressing some concern about the "nontraditional monetary policy" that instigated this sharp change in the monetary base. In their closing words, "Recent increases in the monetary base are far greater than any previously in American history (even adjusted for the size of the economy), surely a "noble experiment" in policymaking. Will these policies be successful without accelerating inflation? The epitaph to this curious case of monetary base expansion is yet to be written."
And really I think that final line quite succinctly sums up the state of modern economics. We've entered into an age of currency growing, inflation chasing, debt drive economics. And it's been working great for the briefest glimpse of time that we've been carrying out this experiment. Does that mean we've finally 'solved' economics, or does an epitaph that looks back somewhat less fondly on our decisions await? I don't know, but I do think the inherent stability of the fundamentals of bitcoin (e.g. - everything except the exchange rate) and the lack of trust it requires makes it a nice balance to our fiat experiments.
[1] - https://fred.stlouisfed.org/series/BASE
[2] - https://www.stlouisfed.org/Publications/Regional-Economist/J...
basically, citizens dealing with the US government. I think it's the same category.
bingo
If you want to do business with drug vendors over the internet, you do it in BTC.
(Altnerately: If you want to donate to Wikileaks...)
Nope. All of these are derivatives of Bitcoin, but none of them are forks. A fork, by definition, shares a genesis block with the parent currency. This is in contrast to a "client fork", where the Bitcoin codebase was modified to create a new blockchain with or without changes in protocol.
Most forks of Bitcoin have been intentional, and the "lesser" chain has died on purpose. Off the top of my head, existing forks are:
BitcoinXT: created in late 2014, it allowed 8MB blocks instead of the 1MB limit for Bitcoin. As of mid-2016, it died due to lack of miner support.
Bitcoin Classic: created in early 2016, it allowed 2MB blocks. It was effectively dead as of early 2017.
Bitcoin Cash (a/k/a BCash, BCH): created in August 2017. It eschewed SegWit, and increased block size to 8MB. It's not dead yet and seems to have a base level of support both in terms of miners and in terms of price. I expect that it will die eventually... but who knows. It is by far the best-supported Bitcoin fork, and there are many who believe that it's the "real Bitcoin" in the sense that it conforms more closely to the original whitepaper.
There are a couple of other forks planned in the near future as well.
edit: is this account a bot that I triggered?
Currency speculators don't give a damn about trust. They're not in it for the long term value that derives from the usefulness of Bitcoin, and that's the only thing you need trust for. They'll cash out when the price gets to a point where they're happy with their return. At that point either new speculators will get on board and keep the price high or the price will fall back to real value of Bitcoin.
Neither really changes the usefulness of Bitcoin or it's long term value as a currency.
We see this globally with the huge effort the USA puts into keeping oil priced / settled in USD. It matters.
USD has a store of value because if I hold USD I know the US govt is going to make people hand over a portion of their labour in taxes which keeps USD demand up.
That's not a good reason to invest in my opinion. Good gamble though.
You could convert USD to BTC and buy something while maintaining exactly the same held balance, no?
Which one do you purchase the coffee with? The one that's losing value as you hold it, or the one that's going gangbusters?
I need to know that I can pay my mortgage and buy food at the end of the week, so stability is paramount.
If you buy something with $100 instead of buying it with bitcoin, that's $100 less you could've put into bitcoin. Or thinking about it another way, if you spend bitcoin and feel like you have less than you'd like to hold, you can simply buy more.
and that's why its going to survive. Its a bit like the fine art market. Why are the wealthy buying $20m dollar paintings? Because in 5 years it goes to auction for $25m.
Now whether "survive" means anything more than being the preferred currency of illegal dealings and ransomware is the big question. I suspect bitcoin has found its market niche and will stay here as-is. Fiat currency will be as strong as ever and the social and political aspects of cryptocurrency have pretty much failed outside of these tiny use cases.
I see it a bit like the Commodore 64 from the 80s. It wasn't the best home computer, but it was cheap and passable and lasted far longer than anyone should have rightfully assumed. "Good" tech doesn't always win, say the way the Amiga never took off like the C64 did. Sometimes we get stuck with "bad" tech for a while.
The decentralized nature of blockchains means that they're hard for individual corporations to control and profit from. That hampers adoption of new closed cryptocurrencies (not Monero or Ethereum though) but can serve as a powerful public utility.
If other CCs can offer 2, 3 equally well, the price premium must be due to something different about 1--how well it performs the functions of money. Is it a better Store of Value? How much better of a Medium of Exchange is it, and is it worth the premium?
As far as I can tell from my napkin analysis, I would guess that bitcoin appears to be in a pretty speculative bubble. This is assuming Ethereum, and other CCs, are equally capable of fulfilling the functions of bitcoin.
I agree with this completely, but think there are a few other factors that will matter in the future but have not yet become widely used. The relative importance of all of these factors has changed over time and will continue to change in the future.
> As far as I can tell from my napkin analysis, I would guess that bitcoin appears to be in a pretty speculative bubble.
Again, I agree. Every time the price of Bitcoin has gone up a great deal in a short time, it's been a bubble caused by speculation or by a new wave of people joining for the first time. Every time that's happened, the bubble has burst. Every time the bubble has burst, it's bottomed out at a level significantly higher than the previous baseline, and every time it's bottomed out it the price has stabilized and ultimately recovered.
If you want to day trade, now is probably a great time to get in - assuming we're still on the way up. If you're wanting to hold long-term, then the safest time to buy will be as soon as the price stabilizes after the next pop. As for me... I buy on a regular basis without regard to the price. I'm something of a "true believer" though, and don't expect to ever sell my entire holdings again.
Not to say Bitcoin isn't in a speculative bubble, who knows?
Aside: I don't know if it's fair to call bitcoin pseudonymous. Tumblers mean that one can effectively obscure their transactions if that's their goal, pseudo-pseudonymous if you will.
The anarchists say how important Bitcoin is, yet, all they care is its fiat exchange ratio as all they care about - cash out their stash in fiat just right before it starts dropping in a get-rich-quick pipe dream.
There is plenty of technical information about bitcoin. Bitcoin has spawned an overwhelming amount of technical discussion with regards to blockchain.
> It may or may not continue to increase in value long-term, but it has little uses outside of being worth a lot of money.
It is a form of currency. What uses are you thinking? Bitcoin popularized blockchain technology. I really don't understand your criticism of Bitcoin.
Absolutely, yet being a store of wealth is a use case in itself. Technically bitcoin is eclipsed by Ethereum (capability wise) and Monero (privacy wise)
I think a lot of the price movement is speculation, but a lot of it is new institutional investors investing in bitcoin. Ask most people who are new investors in BTC if they've heard of ETH, I bet it isn't as large of a proportion as you'd think. People are betting on the future of BTC being greater than it is currently, not about its current value.
Like what?
The only competitors to Ethereum are totally unviable as decentralized systems and sustained solely on hype and misinformation. They are also either not released or have less than 1% of the tx volume of Ethereum.
Ethereum also has a very aggressive and well developed scaling roadmap.
VHS vs. Betamax
Right on the button. Make a lot of money, keep buying, everyone is happy.
So at worst: bitcoin > gold?
[1] https://neo.org/
I keep reading this and sounds false to me. Why do you ignore the illegal drugs market? Lots of people uses bitcoin daily to buy and sell substances. You might have a moral opinion about that fact, but it remains true. You might think it's a small, or temporary market, but I disagree based on the history of humans and drugs use.
While I don't fully disagree that speculation might be the main drive of the price, let's not forget that the are some real, big, uses of bitcoin.
Citation needed.
>Other technically superior cryptocurrencies (e.g. Monero, Ethereum) have replaced most of its usecases, boasting much faster and cheaper transactions and real anonymity in the case of Monero.
Citation needed.
> it has little uses outside of being worth a lot of money.
Citation needed.
Other technically superior cryptocurrencies (e.g. Monero, Ethereum) have replaced most of its usecases, boasting much faster and cheaper transactions and real anonymity in the case of Monero. Bitcoin takes more than an hour even at absurd transaction fees of multiple dollars, and is actually pseudonymous, meaning if you can associate an address with a real person, it becomes relatively easy to trace all their transactions unless they were careful to cover their tracks.
It may or may not continue to increase in value long-term, but it has little uses outside of being worth a lot of money.