Bitcoin-Part 1 by InCharge ..... News Forum
Date: 6/7/2017 12:52:38 PM ( 7 y ago)
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URL: https://www.curezone.org/forums/fm.asp?i=2371515
(Natural News) A quick mathematical analysis of Bitcoin and the world of crypto-currencies: After plunging nearly 30% last week in a severe correction, Bitcoin has since surged back to the $2800 range, this time riding a wave of optimism from Bitcoin noobs in Japan and South Korea who have become irrationally convinced that Bitcoin is a replacement for their retirement savings (see Reuters report, below). Now, even kindergarten teachers are throwing money at Bitcoin, believing they’ve discovered a magical source of unlimited wealth (yep, they really believe it’s all different this time).
Little do they know they are going to lose nearly everything when the Bitcoin end game rears its ugly head, as has already been mathematically programmed into the system. How’s that, exactly?
For starters, due to increased volume, Bitcoin transactional costs have now skyrocketed from roughly $16 per transaction to $23.30 per transaction in just the past week or so, according to Blockchain.info. This is a transactional cost increase of over 30% in just a few days, and it demonstrates the stress of the increasing volume of transactions on the distributed blockchain ledger. It is yet more mathematical evidence that selling Bitcoin and exiting the market in a time of high trading volume will be increasingly expensive and difficult, with long delays on transactions that could require days or even weeks to be confirmed.
Bitcoin will approach its “end game” in the next decade when all Bitcoin mining permanently ceases due to the mathematical limit of 21 million Bitcoins in circulation. (The mining algorithm allows no more than 21 million coins to exist.) In the last 24 hours, 1,850 Bitcoins were successfully mined. This is equivalent to approximately 675,000 Bitcoins in a year, accounting for parallel increases in computational difficulty and enhancements in ASIC mining rigs that carry out hashing calculations more efficiently.
As Bitcoins are limited to a grand total of 21 million Bitcoins, and given that nearly 16.4 million Bitcoins are already mined, this means that if the current mining computational infrastructure keeps pace with the increasing mathematical difficulty for achieving Bitcoin rewards, all Bitcoins will be mined out in about seven years (by roughly 2024). (There are difficulty adjustments in the Bitcoin algorithm, so it might take longer, but Bitcoin mining is approaching an end point in the very near future.)
Once Bitcoin’s block mining rewards are no longer available, mining operations will subsist entirely on transaction fees, which currently represent just 19.34% of the earned miner revenue for Bitcoin mining operations. In other words, rewards will collapse by 80% for Bitcoin miners, making nearly all mining operations unprofitable. This, in turn, will lead to a rapid loss of mining capacity, subjecting the blockchain to an ever-increasing barrage of 51% attacks which will fork the blockchain ledger and obliterate the integrity of the blockchain. (Note: If you don’t know what terms like “hashing” and “51% attacks” and “blockchain” really mean, you have no business owning Bitcoin.)
Once this happens, the blockchain and mining infrastructure self-destructs, and everybody heads for the exits in search of the next “big thing,” causing Bitcoin prices to plunge toward zero.
Or, alternatively, the Bitcoin community decides to change the rules of Bitcoin and open it up to unlimited mining (erasing the 21 million coin limit), effectively engaging in “quantitative easing” policy fraud just like the Central Banks, instantly obliterating any trust in the scarcity of Bitcoins and devaluing all the Bitcoin already in existence. In essence, raising the Bitcoin mining limit would be the massive theft of Bitcoin value from those who already own Bitcoin. A “virtual heist,” in effect.
Either way, Bitcoin comes to a catastrophic end. This is mathematically engineered into the system.
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