i'm missing something here.
why can't the scBTC develop an independent value in USD on their own on an exchange? and if that value starts going up relative to the BTC value b/c the SC turns out to be better functionally, then why wouldn't every BTC owner be forced to transfer their BTC over to scBTC along with a migration of direct mining hashpower to the SC? if the SC is better, the difference in value btwn BTC and scBTC can't be arbitraged away.
the end result being a destroyed Bitcoin and a "new" Sidechain dominance.
Because there is a MATH no 3D party -> how to convert(lock) BTC to scBTC
Rule #1
You can anytime convert BTC to scBTC using this conversion function (if btc protocol is not broken)
repeat(
1. Convert BTC -> scBTC
2. You sell scBTC for $
3. buy more BTC at Bitstamp
)
=> scBTC has only value of BTC (SideChain has value based on BTC)
Rule #2
There is conversion function (MATH) how to convert scBTC to BTC (unlock your/anybody previously locked coins ... if SideChain is not broken => you cannot unlock more, than was locked)
Jumping in. Let's say a scheme like this could be created. As I have argued elsewhere, the value of the money is dependent on the preference to hold. Now even if there is an equal number of locked bitcoins and number of scBTC in existence, the values would differ. Why? This is because the traits of a bitcoin and the traits of a scBTC is different. This is the whole point of the sidechain coins, they are better for some purpose, for example micropayments, and they would also differ in the assumed long time viability, for example. So the question for a holder of some value would repeatedly be, should I hold in bitcoin or should I hold in scBTC, and the choice will affect the value of each.
Should the value of scBTC prove to be higher on the market, according to those preferences, all value would then eventually move to the sidechain coins, and bitcoin would die.