Quote from: Zangelbert Bingledack on November 06, 2014, 04:36:45 PM

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TL;DR: Sidechains (if they succeed) force Bitcoin's hand, although decades in the future, in setting an inflation rate determined by the market, in order to tie miner's subsidies more exactly to the primary service they perform: that of securing Bitcoin's store of value. This is because successful sidechains would allow Bitcoin transactions to be disconnected from Bitcoin miners. Bitcoin therefore could not rely on transaction fees for its network security incentives. Sidechains would have made it clear that transaction functionality is not intrinsic to or inseparable from the Bitcoin network; only the store of value function is, and therefore miners must be continually rewarded for maintaining this function alone, for the lifetime the network.

While I don't necessarily agree with all of your constructs over the years here, I appreciate that you the potential for and disposition toward thinking.

It does seem to me that Bitcoin infrastructure provisioning is designed such that it will always approach unprofitably no matter what the growth rate, inflation rate, fee structure, etc.

It is worthwhile to note that different classes of entities can accept different levels of profit. So, an independent enthusiast class individual might be happy to break even and occasionally make a few bucks while this is not an option for a large commercial. Whatever the case, Bitcoin as implemented simply does not promote the individual class actor very well.

The take-away is that Bitcoin's only realistic hope is for infrastructure providers to monetize some other aspect of Bitcoin's existence. For large corporate actors this is a no-brainier. Monetize the intelligence stream as has been a well proven model over the last 15 years. The big down-side of this is that actors who are able to monetize in this way are distinctly under the thumb of governments, and governments have a very strong propensity to exercise fine-grained control over their citizens. Governments are inextricably linked to corporations and will be for the foreseeable future.

As I've mentioned before, sidechains would seem to provide a golden opportunity to monetize Bitcoin as a credible source of backing which they require in order to function. They thus have a significant interest in keeping it that way.

Right now Bitcoin is fairly credible to at least a cross-section of us in the community because it is free of interference (no 'red-listing', transaction discrimination at the mining level, etc.) Sidechains seem to me like the last best hope of keeping it that way.