Quote from: chriswilmer on September 06, 2013, 12:04:51 PM

Quote from: ex-trader on September 06, 2013, 11:47:17 AM

Quote from: muyuu on September 06, 2013, 10:43:03 AM

We still have 2+ years ahead with 25BTC blocks. I think the fee discussion is fine as a general Bitcoin challenge, but not a current problem for ASICMiner.

But the fees are what many people are holding onto as where the income will come from when mining and hardware keeps falling.

Would you pay the same for Apple if you knew they had to cut their prices in half every 5 years?

That's the whole point of bitcoin though. There is no reason why transaction fees need to add up to less than the original block reward. The total from transaction fees, in BTC, has been growing by 10x roughly every two years (similar to growth of BTC/USD rate, coincidentally). So it would not surprise me if the total transaction fees per block in two years were 3-5 BTC/block (instead of 0.3-0.5 btc/block now), and 30-50 BTC/block in 4-5 years.

So, I think there will always be PLENTY of bitcoins to mine. Whether or not it is profitable to do so will depend on electricity costs, technology, etc.

A big problem with that line of thinking is the overall prevailing view of the community, where many holders think/hope that the value of a single bitcoin could grow to $1000, $10000 or even $1,000,000 (ok, that last one isnt voiced that often, but ive see more than a couple people chime in in agreement when that number was raised; so long as people have hopes and even expectations of that sort of growth, theyre not going to spend their coins, which means theyre not available for making transaction fees off of.

Until we start seeing concrete proof that transaction fees are growing, speculating that they'll achieve any level (3-5 BTC/Block, 30-50 BTC/block) is just that - speculation. It's as useful as attempting to figure out your mining returns if difficulty would just stay flat for months on end.

Yes, the total earned from transaction fees may be growing, but thats not the number to be looking at - we need to look at the transaction fees per block, and by that metric, theyre not climbing at all.

This is a major stumbling point to the fixed cap nature of bitcoin; the compensation that miners earn right now is from Bitcoins that are magically created out of thin air, once miners are forced to rely on fees and only fees to pay for energy consumption, as things look right now, and projecting from the trends we see in transaction fees per block (dangerous, yes, but it's data linked to reality rather than hope), absent a HUGE increase in BTC prices, there will be no reason for miners to mine, save for being a loss generating public service. Which brings about the earlier point, if BTC is to survive longer term, either transaction volume needs to increase greatly or the value of each BTC needs to - since most people are counting on the second and not spending their BTC, that becomes the only real hope for its survival.