Quote from: r0ach on March 12, 2017, 06:26:52 AM

My response to people who believe cost of production doesn't matter in bitcoin:

Quote from: r0ach on March 12, 2017, 05:12:32 AM

Quote from: Killerpotleaf on March 12, 2017, 03:47:47 AM

cost of production has very little effect on price

You're acting like bitcoin has a finite supply. In theory it does, but not in practice since transaction fees are recycled and mining continues FOREVER. It's the equivalent of if platinum costs $1000 an ounce to mine at some point but people are recycling old cars and getting it for $100 an ounce. The lowest available price is the only one that matters. It doesn't matter if the cost of production was $1 million for a coin at some point. It's an open entropy system so if the cost of production goes to zero, people simply plug into the system and mine those recycled coins for free rather than paying you $1 million.

If there are no recycled fees to mine, it means the system was already dead in the first place. The act of making fees recycle is the equivalent of infinite supply when a bitcoin is an arbitrary unit in the first place, just with the store of value aspect of that supply resting on cost of production instead of scarcity. Each halving doubles cost of production, which enables you to increase price or lower mining input. If you run out of halvings and then lower cost of production, you should have a corresponding effect to devalue other already existing coins. Do you see now why cost of production actually does matter?

Most people with an IQ of 70 that don't know their head from a hole in the ground call bitcoin a ponzi but have no idea how it even works, yet if you really do understand how it works, it actually does resemble somewhat of a ponzi where arbitrary dates are inserted and proclaimed that on this date, the price must rise if mining input stays the same. If that's not a "scheme" of some type, then I don't know what is.

Cost of energy is never free and difficulty keeps rising as rewards drop.. ive alresdy covered your mistake.. your arguments are not grounded they are roach theory not economics.. anyways let the market decide and we can come back in 10 yrs and see sure? Until then how about we take a wait and see approach rather than trolling everyone that gold > xyz? Deal?