/biz/ - Business & Finance

>>29280092
Been doing some thinking and it just doesn't seem like blockchain technology will ever have any lasting purpose.

Bitcoin for example is not stable, it never will be because its security and usability relies on constant work input in the form of electricity and hashing power which needs to be financed somehow. Currently it is financed with 900BTC per day in inflation and 100BTC per day in tx fees, that's 90% inflation and 10% tx fees.
As time goes on the cost burden will shift entirely to transactions and then no one will transact because the cost will be too high and so the network will be underfunded and become susceptible to attacks. The reason each individual transaction cost will be too high is that Bitcoin only can handle 7 transactions per second, compared to, say, golds infinite number of transactions.
And no, layer 2 'solutions' like Lightning do not work because any transaction that is below the dust threshold (layer 1 tx fee) is easily destroyed by dumping the value-in-flight in the fee bucket instead of pushing it along the channel, thus payments on Layer 2 for amounts below what is economically feasible to carry-out on Layer 1 cannot be made “trustless".

Keep in mind that in 2017-2018 many Bitcoin users had to wait weeks for transactions to be confirmed despite paying ample $60 dollar transaction fees. This was back when BTC was dipping from $18k to around $14k and there was a lot of tx during the panic.
As Bitcoin becomes more expensive the cost needed to secure the network increases as the incentive for attacking the network grows as well.
Can you imagine the tx cost if Bitcoin goes to $500,000 and the coin limit is hit which pushes 100% of the network funding costs over on the transactions?

Also keep in mind that if everyone on the planet was to make just one transaction it would take the network over 34 years to confirm making it impossible to use Bitcoin in a shtf scenario, meaning it is worthless as a reserve currency.