Quote from: saethan on October 07, 2011, 07:05:53 PM

Quote from: EvryIntl on October 07, 2011, 06:45:30 PM

Quote from: saethan on October 07, 2011, 06:39:47 PM

Here's a good question for bitcoin price: what happens next year at block 210000?

Why would that matter?

https://en.bitcoin.it/wiki/How_bitcoin_works

Particularly,

Quote

First, the block producer gets a bounty of some number of bitcoins, which is agreed-upon by the network. (Currently this bounty is 50 bitcoins; this value will halve every 210,000 blocks.)

Which is the reason there will never be more than 21 million bitcoins, it's a mathematical series that infinitely approaches 21 million. If you halve the amount produced after every 210,000 blocks, you know after the first 210,000 you will have half of everything that will ever be available, which is (210000*50) = 10.5 million btc. Not sure exactly how it is programmed, but this either means at some point new blocks will produce the smallest decimal allowed by the language it is written in, or they will produce zero new bitcoins, and profits from mining will come 100% from transaction fees. By that point, well beyond any of our life expectancies, bitcoin will most likely be long dead, though. Or insanely popular, in which case my grandkids will be -rich-. Wink

Aahh. I gotcha. I didn't realize the payout halved at 210000 - I get the rest of the situation.

However, IMO, it's irrelevant. The intrinsic value of any currency is based on what it can purchase - nothing more, nothing less. Assuming that the community of products and services grows and the general acceptability improves (which, IMO, is a function of usability to the Average Joe/Jane and general stability relative to the USD more than anything else), then the incentive to mine any number of coins should be there as long as the cost in fiat doesn't exceed the relative purchasing power of one BTC. In other words, I'd expect this to be more of an economic question rather than a technical one.

BTC will never die if the transaction fees generated still create a real-world profit. Someone will take the profit. If it' s not profitable, well than that's a different story.

Based on the Austrian theory of money, any "reasonable" amount of currency in circulation is enough to fullfill the role of money. As long there's enough such that everyone can get some, it will suffice perfectly well and increase in purchasing power.

At least we'll test this theory, I suppose....