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Old 12th December 2022, 03:53 AM   #3041
psionl0
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Originally Posted by jeremyp View Post
Has is Bitcoin better for El Salvador's purposes than just using USD?
Probably not but it is still a non-speculative, non-criminal use of bitcoin.
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Old 12th December 2022, 07:13 AM   #3042
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Originally Posted by psionl0 View Post
Probably not but it is still a non-speculative, non-criminal use of bitcoin.
yes, but the original challenge, at least as far as I phrased it was, what is the legal utility of Bitcoin that isn't better fulfilled by fiat currency. That last part is critical: I don't deny that Bitcoin has some utility. My point is just that it is not worth the downside that comes with Bitcoin.

Last edited by jeremyp; 12th December 2022 at 07:15 AM.
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Old 12th December 2022, 07:17 AM   #3043
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Originally Posted by psionl0 View Post
Probably not but it is still a non-speculative, non-criminal use of bitcoin.
Except nobody is really using it. Just a few tourists in McDonalds.

Even remittances, where you'd think it might have a use, only 1.6% are carried out in bitcoin.
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Old 12th December 2022, 10:13 AM   #3044
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Originally Posted by psionl0 View Post
More likely ignorance. Most people would realize that the price of bitcoin depends on the market and not on how difficult it is to mine. The mining difficulty is a function of the bitcoin price and not the other way around.
Yeah, but he knows this. Saylor is a bright guy but a risk taker. Check out his near disaster in 2001 where he had gone from a star on 60 Minutes, to the poster boy of stock market fraud in a few months.

Since MSTR (his biz) owns enough BTC, and borrowed real money to buy much of it, he is highly incented to disparage other crypto to pump BTC. And proof of work, with the large amount of capital miners have consumed, is the main argument he uses to do so.
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Old 12th December 2022, 05:30 PM   #3045
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Originally Posted by jeremyp View Post
yes, but the original challenge, at least as far as I phrased it was, what is the legal utility of Bitcoin that isn't better fulfilled by fiat currency. That last part is critical: I don't deny that Bitcoin has some utility. My point is just that it is not worth the downside that comes with Bitcoin.
There is no "one size fits all" here. For domestic consumption, you would almost certainly use fiat every time (unless it was subject to hyperinflation).

For international transfers (especially if currency conversions are necessary) individuals may find it more convenient and cheaper to use bitcoin.
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Old 13th December 2022, 08:17 AM   #3046
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Originally Posted by psionl0 View Post
There is no "one size fits all" here. For domestic consumption, you would almost certainly use fiat every time (unless it was subject to hyperinflation).

For international transfers (especially if currency conversions are necessary) individuals may find it more convenient and cheaper to use bitcoin.
My bank will let me make an international transfer for a flat fee (15 - less for Euros) and it's more or less instantaneous these days. Can Bitcoin match that?
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Old 13th December 2022, 12:52 PM   #3047
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Originally Posted by jeremyp View Post
My bank will let me make an international transfer for a flat fee (15 - less for Euros) and it's more or less instantaneous these days. Can Bitcoin match that?
It varies depending on multiple factors but the average bitcoin transaction fee is about $1 and takes 30 minutes or less for the full 6 confirmations. You can choose to pay a higher fee to get your transaction done faster.

So at least in this regard bitcoin matches or exceeds international bank transfer.
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Old 13th December 2022, 04:41 PM   #3048
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Originally Posted by The_Animus View Post
So at least in this regard bitcoin matches or exceeds international bank transfer.
I haven't done an international transfer in over 30 years, yet I've bought lots of stuff from overseas and never once had to wait for confirmation. I also sold a bit of stuff without any hassle or onerous fees. How is that possible? Perhaps all this time I've been using Bitcoin (or something better than Bitcoin) and didn't know it...

But right now I have another problem. I just turned 65, and my bank balance is mysteriously going up without me doing anything. Seems that many years ago I enrolled in a scheme called 'paying taxes', and I hodled for so long they decided I qualify for free money!

I was worried that it might be scam. Some people say they pay out with money received from new investors, and that if fewer people pay in the whole thing will collapse. But I pointed to Bitcoin as an example to show them that this won't happen. I mean, everybody's being saying it was a scam and would collapse from the beginning, and look at it now!
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Old 13th December 2022, 05:34 PM   #3049
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Originally Posted by jeremyp View Post
My bank will let me make an international transfer for a flat fee (15 - less for Euros) and it's more or less instantaneous these days. Can Bitcoin match that?
Sending money to a business overseas is usually not a problem. The business is usually set up for bulk international transfers.

It is when an individual wants to receive money from overseas that the fun starts.
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Old 14th December 2022, 03:30 AM   #3050
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Originally Posted by Roger Ramjets View Post
I haven't done an international transfer in over 30 years, yet I've bought lots of stuff from overseas and never once had to wait for confirmation. I also sold a bit of stuff without any hassle or onerous fees. How is that possible? Perhaps all this time I've been using Bitcoin (or something better than Bitcoin) and didn't know it...

But right now I have another problem. I just turned 65, and my bank balance is mysteriously going up without me doing anything. Seems that many years ago I enrolled in a scheme called 'paying taxes', and I hodled for so long they decided I qualify for free money!

I was worried that it might be scam. Some people say they pay out with money received from new investors, and that if fewer people pay in the whole thing will collapse. But I pointed to Bitcoin as an example to show them that this won't happen. I mean, everybody's being saying it was a scam and would collapse from the beginning, and look at it now!
In my case when I buy something from overseas I do so with a credit card rather than a direct transfer. The credit card company takes care of the currency conversion and transfer. That said *somebody* pays for that service. AIUI the vendor will pay a fee for accepting payment from the credit card and, depending on the card and currencies used, the purchaser may end up paying a transaction fee and/or getting a comparatively poor exchange rate.

The experience I do have of receiving payments from overseas are Daddy Don's US Social Security payments and Mummy Don's book royalties from Spain, Portugal and Brazil. In both cases payment was in local currency and to receive payment in GBP involved both a transaction fee and a poor(er) exchange rate which together accounted for 2-3% of the money.
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Old 14th December 2022, 04:16 AM   #3051
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Originally Posted by psionl0 View Post
Sending money to a business overseas is usually not a problem. The business is usually set up for bulk international transfers.

It is when an individual wants to receive money from overseas that the fun starts.
What I quoted were the fees that my bank would charge me as an individual for transferring money to somebody else's foreign bank account.

Last edited by jeremyp; 14th December 2022 at 04:20 AM.
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Old 14th December 2022, 04:19 AM   #3052
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Originally Posted by Roger Ramjets View Post
I haven't done an international transfer in over 30 years, yet I've bought lots of stuff from overseas and never once had to wait for confirmation. I also sold a bit of stuff without any hassle or onerous fees. How is that possible? Perhaps all this time I've been using Bitcoin (or something better than Bitcoin) and didn't know it...
I was specifically talking about money transfers, not buying stuff. If I want to buy something from abroad, I just use my credit card and it is instantaneous. The fees can be a bit higher, especially if there is a currency conversion involved, but there are other advantages e.g. I am protected from fraud.
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Old 14th December 2022, 09:39 AM   #3053
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Originally Posted by jeremyp View Post
I was specifically talking about money transfers, not buying stuff. If I want to buy something from abroad, I just use my credit card and it is instantaneous. The fees can be a bit higher, especially if there is a currency conversion involved, but there are other advantages e.g. I am protected from fraud.
Also worth noting is that the bitcoin version of a money transfer isn't a single step process. You fist need to buy bitcoin, they transfer it, then the person you send the money too needs to sell the bitcoin on the other end, and hope that it's value hasn't dropped since you started.
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Old 14th December 2022, 06:15 PM   #3054
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Originally Posted by jeremyp View Post
What I quoted were the fees that my bank would charge me as an individual for transferring money to somebody else's foreign bank account.
And what are the fees the banks would charge you as an individual for receiving money from a foreign bank account?
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Old 15th December 2022, 12:04 AM   #3055
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Originally Posted by psionl0 View Post
And what are the fees the banks would charge you as an individual for receiving money from a foreign bank account?
Nothing as far as I can tell.

ETA. Nope 7 is the answer or zero for Euros.

Last edited by jeremyp; 15th December 2022 at 12:07 AM.
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Old 15th December 2022, 09:23 AM   #3056
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Originally Posted by jeremyp View Post
Nothing as far as I can tell.

ETA. Nope 7 is the answer or zero for Euros.
They may also make money out of the exchange rate as well - at least that was the case with my father's social security payment and my mother's royalty payments.
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Old 15th December 2022, 11:15 AM   #3057
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Originally Posted by The Don View Post
They may also make money out of the exchange rate as well - at least that was the case with my father's social security payment and my mother's royalty payments.
As with any exchange rate, there is always a buy/sell spread. But that would apply to converting fiat currency to and from Bitcoin as well.
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Old 15th December 2022, 02:56 PM   #3058
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Originally Posted by jeremyp View Post
As with any exchange rate, there is always a buy/sell spread. But that would apply to converting fiat currency to and from Bitcoin as well.
Not exactly. Typically you are not buying crypto from the exchange. You buy crypto from crypto holders, which might be also an exchange, but not necessarily.
First you deposit fiat to exchange, without conversion. But this can be subjected to fees, and it can by itself be international transfer.
Then you use this deposit to buy crypto .. but using trade mechanics. You place an order to buy, with any price you set .. and you either find a seller or not.
Exchange does not set the price .. it just tracks the price at which the trades took place recently.
On the other hand .. yes, you are most likely to find a seller if you offer to give currently traded price with some small extra, and you can usually make some form of instant order, which is basically transaction between you and the exchange at price set by exchange in similar manner.
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Old 15th December 2022, 09:01 PM   #3059
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Like someone said upthread, should speculators largely delink from BTC, and it's price stabilized to, I don't know, a dollar or two or five, then it might actually end up being of use as currency, even if still a niche instance. A very insightful comment, is how it struck me.

But of course, that's stating the obvious, the volatility thing. Besides, how on earth get rid of speculation? But an additional factor is the dizzying price level. Unless ways can be thought to cut it up into pieces somehow, like share splits, or some shadow currency of smaller denomination but based on BTC, the price level itself acts as a barrier to being an effective currency, over and above the rest of its shortcomings I mean. That isolated factor can be addressed, should prices fall to single digit dollar levels.
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Old 15th December 2022, 10:30 PM   #3060
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Originally Posted by Chanakya View Post
Unless ways can be thought to cut it up into pieces somehow, like share splits, or some shadow currency of smaller denomination . . .
That was originally part of the design spec. The hope was that the price of bitcoin would get so high that you had to break it up into smaller units.

We have mBTC (1/1000th of a BTC), uBTC (1/1000,000th of a BTC) and the "Satoshi" (1/100,000,000th of a BTC).

At current prices, $1 USD = 57 uBTC.
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Old 16th December 2022, 02:21 AM   #3061
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Originally Posted by jeremyp View Post
As with any exchange rate, there is always a buy/sell spread. But that would apply to converting fiat currency to and from Bitcoin as well.
Yes, but the buy/sell spread can be considerably wider depending on which financial institution you're using.

For example my Nationwide Building Society Visa card doesn't charge a transaction fee for foreign currency transactions and the exchange rate is very close to the spot rate.

My Barclaycard Visa card charges a 1% fee and the exchange rate is typically 1%-2% worse than the spot rate.
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Old 16th December 2022, 03:17 AM   #3062
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Originally Posted by The Don View Post
Yes, but the buy/sell spread can be considerably wider depending on which financial institution you're using.

For example my Nationwide Building Society Visa card doesn't charge a transaction fee for foreign currency transactions and the exchange rate is very close to the spot rate.

My Barclaycard Visa card charges a 1% fee and the exchange rate is typically 1%-2% worse than the spot rate.
The virtue in these fees is the certainty your capital is preserved.
Crypto is impossible without entities resembling banks to transfer wealth. From time to time that wealth disappears as in FTX etc.
Richi Sunak is the latest celebrity to extoll crypto, watch this space.
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Old 16th December 2022, 03:44 AM   #3063
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I suspect the present few hours down draft in crypto "assets" is related to Binance and Mazars suspension of auditing work.

https://www.tradingview.com/news/reu...rypto-clients/
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Old 16th December 2022, 03:57 AM   #3064
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Media sentiment regarding cryptocurrencies seems to have changed:

Quote:
If Bitcoin was a boxer it would be a scrappy brawler that refuses to give up.

But the last few weeks it has taken a pummelling, with the collapse of industry giant FTX and the arrest of its founder Sam Bankman-Fried in the Caribbean.

Bitcoin is used to taking knocks, but this anti-establishment fighter was already on the ropes after its most bruising year yet.

If Bitcoin was a boxer it would be lying on its back on the canvas seeing stars.

It is down, but is it out?
https://www.bbc.co.uk/news/technology-63990215

Whether this is an accurate summary of the situation is a question I would leave to the reader to assess. I've never understood cryptocurrencies so I wouldn't know when or if they've jumped the shark.

Given how wrong the media usually is (or how far behind the curve) then I wouldn't be shocked if there was a sustained surge in the price of Bitcoin over the next few months.
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Old 16th December 2022, 06:48 AM   #3065
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I cannot comment on the accuracy of this Youtube video claiming that using Bitcoin has allowed money to be funnelled to Russia.

YouTube Video This video is not hosted by the ISF. The ISF can not be held responsible for the suitability or legality of this material. By clicking the link below you agree to view content from an external website.
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Old 16th December 2022, 08:28 AM   #3066
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Originally Posted by psionl0 View Post
That was originally part of the design spec. The hope was that the price of bitcoin would get so high that you had to break it up into smaller units.

We have mBTC (1/1000th of a BTC), uBTC (1/1000,000th of a BTC) and the "Satoshi" (1/100,000,000th of a BTC).

At current prices, $1 USD = 57 uBTC.
Designing a currency around the assumption of hyper-deflation is... interesting.
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Old 16th December 2022, 08:31 AM   #3067
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Originally Posted by The Don View Post
I cannot comment on the accuracy of this Youtube video claiming that using Bitcoin has allowed money to be funnelled to Russia.

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It strikes me as a "water is wet" sort of revelation. It's the nature of the beast that bitcoin could be used in ways to avoid government regulation. I mean, that's a large part of the case for it's existence.

It's just one person's noble civil disobedience is another person's criminal behavior.
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Old 16th December 2022, 06:36 PM   #3068
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Originally Posted by The Don View Post
Media sentiment regarding cryptocurrencies seems to have changed:

https://www.bbc.co.uk/news/technology-63990215

Whether this is an accurate summary of the situation is a question I would leave to the reader to assess. I've never understood cryptocurrencies so I wouldn't know when or if they've jumped the shark.

Given how wrong the media usually is (or how far behind the curve) then I wouldn't be shocked if there was a sustained surge in the price of Bitcoin over the next few months.
There is a myth that bitcoin can't exist without exchanges and that if an exchange disappears then so does bitcoin.

This has just never been the case in the past. Exchanges have come and gone (most notably MtGox) yet bitcoin keeps bouncing along. As long as there is a demand for exchanges, new exchanges will crop up as others fail.
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Old 17th December 2022, 08:46 PM   #3069
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Originally Posted by psionl0 View Post
That was originally part of the design spec. The hope was that the price of bitcoin would get so high that you had to break it up into smaller units.

We have mBTC (1/1000th of a BTC), uBTC (1/1000,000th of a BTC) and the "Satoshi" (1/100,000,000th of a BTC).

At current prices, $1 USD = 57 uBTC.

That's interesting. I hadn't known that.

Looked it up, admittedly very cursorily, and apparently the tiny Satoshi unit can get recorded in the blockchain. That's very cool, in that that specific issue I spoke of had clearly been pre-empted, and a workaround already built in. So I can, already, and ignoring all other issues for the moment, actually order a pizza today using BTC.

Heh, but that also means Satoshi had intended, or at least pre-empted (maybe hoped and prayed for?!), this frenzy of speculation interest. ............But I guess that's kind of unfair, that criticism, because if you don't do it it's a design glitch, and if you do then it's greedy hope-to-get-rich-quick cunning!


So, the sense I get from a cursory read of some stuff, is that as we get closer to the limit, it isn't that mining will stop, but that smaller and smaller units will be produced, in lesser and lesser amounts. Of course, whether that will be cost-effective will be a function of the price levels prevailing, as always.
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Old 17th December 2022, 09:00 PM   #3070
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Miner's don't make money only on minting bitcoins but also on fees to include pending transfers. People that want their transfers recorded quickly offer higher amounts. Miners can and do give priority to those that offer more. As the bitcoin limit is reached, miners will depend more on the fees and less on the bitcoins they mine.
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Old 18th December 2022, 03:28 AM   #3071
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Someone might answer this.
Bitcoin at 1 million dollars will consume all world energy?
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Old 18th December 2022, 08:15 AM   #3072
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Originally Posted by Samson View Post
Someone might answer this.
Bitcoin at 1 million dollars will consume all world energy?
No. Mining complexity has little to do with bitcoin price. It''s adjusted by algorithm to maintain a mined block rate regardless of price.
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Old 18th December 2022, 08:21 AM   #3073
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Originally Posted by psionl0 View Post
There is a myth that bitcoin can't exist without exchanges and that if an exchange disappears then so does bitcoin.
Probably it does - if all the exchanges disappear. How do ordinary people buy and sell Bitcoin without an exchange? If you want to buy BTC, you have to find somebody who has got it and agree a price with them. Theoretically, you can do it without an exchange but it's much more difficult.

Furthermore, exchanges can actually make BTC more efficient because, as long as you leave your cryptocurrency in the exchange's wallet, nothing has to go on the blockchain. BTC already has a scaling problem, I wonder how much worse it would be without exchanges.
Quote:
This has just never been the case in the past. Exchanges have come and gone (most notably MtGox) yet bitcoin keeps bouncing along. As long as there is a demand for exchanges, new exchanges will crop up as others fail.
You're conflating the demise of individual exchanges with the demise of the whole system. MtGox was a famous failure but it was far from the only place you could trade BTC. If it had been, BTC would have crashed almost to zero.

That leads me to realise that your opening sentence is a straw man. Nobody says any single exchange is a requirement for Bitcoin to work, but there must be some exchanges.

Last edited by jeremyp; 18th December 2022 at 08:22 AM. Reason: Clarification on straw man
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Old 18th December 2022, 08:31 AM   #3074
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Originally Posted by marting View Post
No. Mining complexity has little to do with bitcoin price. It''s adjusted by algorithm to maintain a mined block rate regardless of price.
Actually, it has a lot to do with the price. If a BTC = $1 million, I can spend $990,000 electricity mining it and still make a profit. If a BTC is only worth $1,000 and it costs me $990,000 to mine, I lose money.

Conversely, if it only costs $1k to mine a Bitcoin and it is worth $1 million, there's a huge profit, which means lots more mining will be done, which means the complexity and hence the cost will go up. The equilibrium point is probably around the point where it stops being profitable to mine BTC i.e. near the price of BTC.

It's slightly complicated by the fact that there are fees as well, but if the profit is BTC value + fee, then the cost is likely to be near that, because, if it was much less, you'd have more people joining the pool of miners.
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Old 18th December 2022, 09:12 AM   #3075
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Originally Posted by jeremyp View Post
Actually, it has a lot to do with the price. If a BTC = $1 million, I can spend $990,000 electricity mining it and still make a profit. If a BTC is only worth $1,000 and it costs me $990,000 to mine, I lose money.
If BTC was $1,000, or even $100, many mining companies would be out of business. In particular the leveraged ones that borrowed money over their capital investment. But the hashes needed to mine a block would just decrease such that the burn rate (electricity mostly) of miners is less than or equal to the required income. Minting of new blocks would continue.
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Old 18th December 2022, 10:40 AM   #3076
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Originally Posted by jeremyp View Post
Probably it does - if all the exchanges disappear. How do ordinary people buy and sell Bitcoin without an exchange? If you want to buy BTC, you have to find somebody who has got it and agree a price with them. Theoretically, you can do it without an exchange but it's much more difficult.
Crypto ATMs exist pretty much everywhere at this point. Even some small towns with a population of less than 5k have them. Some you can only buy crypto, some you can buy or sell. You don't need an account and you use your own wallet. Scan your wallet address, put in your money, wait 15 minutes for the blockchain confirmations, and you're done. Anyone with sufficient funds can buy one of the various models of crypto ATM and make an arrangement with a local gas station or whatever to house it just like any other ATM.
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Old 18th December 2022, 11:10 AM   #3077
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Originally Posted by The_Animus View Post
Crypto ATMs exist pretty much everywhere at this point. Even some small towns with a population of less than 5k have them. Some you can only buy crypto, some you can buy or sell. You don't need an account and you use your own wallet. Scan your wallet address, put in your money, wait 15 minutes for the blockchain confirmations, and you're done. Anyone with sufficient funds can buy one of the various models of crypto ATM and make an arrangement with a local gas station or whatever to house it just like any other ATM.
Doesn't that make it an exchange ?
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Old 18th December 2022, 11:53 AM   #3078
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Originally Posted by marting View Post
If BTC was $1,000, or even $100, many mining companies would be out of business. In particular the leveraged ones that borrowed money over their capital investment. But the hashes needed to mine a block would just decrease such that the burn rate (electricity mostly) of miners is less than or equal to the required income. Minting of new blocks would continue.
You now seem to be agreeing with Samson. The more expensive BTC is, the more electricity will be consumed by miners.
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Old 18th December 2022, 12:03 PM   #3079
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Originally Posted by The_Animus View Post
Crypto ATMs exist pretty much everywhere at this point. Even some small towns with a population of less than 5k have them.
I've never seen one in my life.

Quote:
Some you can only buy crypto, some you can buy or sell. You don't need an account and you use your own wallet. Scan your wallet address, put in your money, wait 15 minutes for the blockchain confirmations, and you're done. Anyone with sufficient funds can buy one of the various models of crypto ATM and make an arrangement with a local gas station or whatever to house it just like any other ATM.
Let's suppose that you own one of these ATMs. Where do you get the BTC to "stock" it? How do you price the BTC?

If you had a BTC ecosystem without exchanges, they will inevitably arise because they make certain functions very much easier.

By the way, these ATM's sound like an excellent way to scam people, particularly the ones where you can sell BTC.
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Old 18th December 2022, 12:05 PM   #3080
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Originally Posted by jeremyp View Post
You now seem to be agreeing with Samson. The more expensive BTC is, the more electricity will be consumed by miners.
That's generally true except I don't see BTC's value going through the roof. However, i suspect investors in mining put a large portion of that capital into BTC marketing. To the extent more buyers than sellers drive up the price, current miners benefit. Works until it doesn't then you have underwater miners. But mining will go on. Trick for the VCs is when to jump in and out of the miners. My perspective on bitcoin and crypto/web3 in general, is similar to Molly White's. It's a solution in search of a problem. Blockchain is a clever idea but actual use cases are somewhat elusive.
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