Lair Of The Multimedia Guru

2020-11-10

Bitcoins and Inflation

Just today on youtube i again heard people talk about how crypto currencies are special as some are not inflationary while everything else fiat (printing), equity (dilution) and precious metals (mining) are inflationary. That is, all loose value over time.
But this is in some sense, not actually true.
Bitcoins require a blockchain to be maintained and the key requirement for that is that any adversary can never have 51% of the computational power. That requires a continuous “payment” of computational resources / energy. Which ultimately has the same effect as payment though someone printing/diluting/mining. If the blockchain is not maintained with enough computational power then at some point it becomes economic for an attacker to do double spend attacks by modifying the blockchain.
Iam sure iam not the first realizing this. But bitcoins kind of suck due to their vast computational blockchain maintaince requirements which also end up increasing co2 emissions or waste energy if it used renewables. Id wish we had some crypto that didnt had this energy problem and properly maintained privacy, it would be cool in a world where governments try to always increase their power over citizens and what they own.
PS: No, this is not supposed to be a prediction of what the bitcoin value will do in the coming years, it could go up alot or down by alot i have no clue.

Filed under: Uncategorized — Michael @ 13:27

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