Post
Topic
Board Bitcoin Discussion
Re: Is it possible that Bitcoin becomes quiescent?
by
DannyHamilton
on 13/11/2019, 21:40:07 UTC
In the year 2130 all of the Bitcoins will have been mined and the only reward at this point is transaction fees,if most people are using Bitcoin just as a store of wealth, then there are very few transactions, which means there is very little reward for mining and so a lot of computers would pull out of the Bitcoin network. Would this be a problem? If large Bitcoin transactions occured sparingly in 2130 and beyond, would the Bitcoin concept still work?

When you say "a lot of computers would pull out of the Bitcoin Network", I assume you mean that there will be very little hash power?  And you also mean that more than half of the hash power that is present will potentially be controlled by a single entity?

If that is true...  Then people will NOT use Bitcoin as a store of wealth. It is the hashpower that makes the blockchain indelible.  If the blockchain is not indelible, then Bitcoin is not a good store of wealth.

But, if people are not going to use Bitcoin as a store of wealth, then you no longer need to be concerned about there being very few transactions. You yourself said:
"if most people are using Bitcoin just as a store of wealth, then there are very few transactions"

So, if most people are NOT using Bitcoin just as a store of wealth, then there are NOT very few transactions.

Since there are lots of transactions, there are lots of fees available for miners.  This means that there are lots of miners providing lots of hash power, which results in a very secure and indelible blockchain (they all want to earn from those transaction fees).

Since the blockchain has lots of hash power and is very secure and indelible, that means that it can be used as a store of wealth.

Interesting how that feedback loop works, isn't it?

Seems like the feedback might cause a natural balance where there are enough transactions to pay for the mining and any excess can sit in storage if the owners of the funds prefer.