I was not aware of anyone else using the term provider. Bitshares has delegates, NuBits has custodians, Lightning has hubs, etc. The problem is that as soon as one reaches any scale, one will come in contact with traditional law, the rest of the financial system, Internet services, etc. No ethical business can allow itself to operate outside the law. Its not quite clear what the goal of a global decentralised cryptocurrency would entail. Bitcoin works great in terms of preventing conflict upfront. It doesn't work great for integrating any traditional relationship. If a user wants to trust a counterparty for certain things he should be able to do so. Providers are based on such a relationship. The solution I've come up for this situation is smart collateral which I will detail in another thread. In brief, its a payment upfront to establish trust, which can be seized on misbehaviour by the counterparty (a bit like an insurance against theft).

Edit: the one tool that big companies and rich people have is that they choose the jurisdiction they want to operate in. If rich people can choose their laws and poor people can't then this is not a fair system. So the one perfectly viable strategy and legal strategy is to choose a friendly jurisdiction. It is kind of ironic that Bitcoin mining is most profitable in China.


The system serves it participants which want some kind of utility out of it, be it a profit or a service. Bitcoin works to the extent it does, because it carefully balances all elements. Game-theory is perhaps the most important tool for analysing these systems. Mining is a competitive race. But its unclear what the economics of Bitcoin should look like without the bootstrap subsidy.