[eloff]

Its not a payment system (unless the transaction is sufficiently large).

It's more like digital gold. But gold has a track record of holding value over millennia. Bitcoin is only a decade old. Will it hold up over time? Nobody actually knows.

[agravier]

> Its not a payment system (unless the transaction is sufficiently large). > It's more like digital gold.

As explained by the famous paper: "Bitcoin: Definitely Not A Peer-to-Peer Electronic Cash System"

[auntienomen]

And rebutted in the equally well known "Bitcoin: A Comically Badly Designed and Completely Dysfunctional Peer-to-Peer Electronic Cash System".

[agravier]

I perfectly agree that Bitcoin has stopped innovating long ago to become many people's wasteful cash cow, and needs to die soon.

But I don't like "it's actually meant to be digital gold" revisionism.

[sp332]

It was an impressive proof of concept. There are technically better cryptocurrencies (along pretty much any dimension), but they just didn't get as much attention. Maybe these articles about how bad bitcoin is should call out some alternatives.

[sumedh]

What are the better alternatives?

[sp332]

The Lightning network is an overloy network on Bitcoin that allows faster transactions and higher transactions-per-second. Due to the economics of mining, it won't decrease the overall electricity usage of the network, but will make it more "efficient" per-transaction.

Ethereum is more programmable, to the point of being quite easy to shoot oneself in the foot. (Bitcoin is intentionally not Turing-complete to avoid abuse.)

Anything with proof-of-stake instead of proof-of-work is going to be less wasteful in terms of electricity. Ethereum is trying to get there but it has been delayed a lot.

The slow pace of block creation has been a problem with Bitcoin for a long time and lots of blockchains have higher transaction-per-second capacities and quicker verification times. Ripple was promising but had some serious scandals and I don't know if it has a future. Anyway, Bitcoin is one of the slowest ones out there now.

Several have improved on the privacy/anonymity aspects. The most famous of those I think is Monero.

[Bluestein]

This.

Point to the many, innovative, options.

[sp332]

Got some suggestions for your sibling comment by sumedh?

[Bluestein]

(I did not want to sound like I was advocating for anything in particular, but since it would be on topic, and you kindly ask :)

As you said, as a start, anything with a higher TPS (transactions per second) is more efficient, which helps. Some notables, in my mind (not exclusive, of course) ...

The Solana Chain ...

- https://solana.com/

I really love what Cartesi is doing: They are bringing Smart Contracts to the "linux stack", securely (same guarantees than on-chain) but -outside- of chain. This will, obviously, raise efficiencies ...

- https://cartesi.io/

The Fantom chain is high performance -and- their contracts are Ethereum-compatible (smart!), aside from it being a very nice, well thought out "ecosystem"

- https://fantom.foundation/

The NANO token makes it a point of pride, exactly how -much- more efficient ("Eco-friendly") it is than BTC, and their approach is interesting. (It has got some HN love lately and everything :)

- https://nano.org/

(On a tangent, I am also a fan of what FRAX is doing in the stablecoin space, bringing decentralization and transparency to that space ("Frax is the world’s first fractional-algorithmic stablecoin") ...

- https://frax.finance/

(Disclosure: Am currently holding CTSI and FXS and FRAX - All of the projects above have their corresponding tokens.

The points above stand, though :)

[rootusrootus]

> Nobody actually knows.

We could make an educated guess, however. Gold has intrinsic value, which gives it a significant advantage over a tiny arrangement of bits in an ocean of them.

[eloff]

It does, but that only establishes a low floor on the price of gold. If it had no value as a store of wealth, it would plummet in value to a tiny fraction of what it is actually worth.

Bitcoin has a floor of 0 in theory.

I would also guess that makes gold better as a store of wealth. But given that the price rarely ever approaches that floor means it might not matter. And bitcoin is harder to steal (at least you don't have to pay someone to guard it in a vault), easier to divide and transact and verify ownership. I don't claim to know how it will turn out.

[torgian]

I wonder about the value of gold. You might buy gold, but can you actually, physically hold it and own it?

As far as I know, the only way you can buy gold is if you either buy jewelry or are a jeweler to make said jewelry. Otherwise you’re just buying stocks which could theoretically be lost in the digital wind.

[rootusrootus]

You can definitely buy gold coins. I have one in my desk drawer right now, even.

[torgian]

I wonder how much that is marked up, however. Compared to just buying bare gold, I mean.

Obviously even bare gold would have a markup, but probably not as much as coins.

[reducesuffering]

Depends on the weight of the coin, but 1+ oz. can be as low as 1% above spot (bare gold price), where 1/20 oz. can be as high as 10% above spot. So 1-10% markup for most purposes

[zepto]

> easier to divide and transact and verify ownership

Yes, in the presence of high tech infrastructure, but otherwise impossible.

Gold coins carry on working no matter what the nazis do to the internet and the chip foundries.

[slashdev]

The Nazis famously confiscated gold. At least if they shutdown the internet you still own your bitcoin.

[zepto]

The Nazis can confiscate the hard drives where your keys are stored.

And - it’s not going to help you against the Nazis if you can’t transact it.

As to gold - that misses the point. Of course it can be taken from you.

However unless that happens, you can still transact it. People escaped the Nazis using gold to pay their way.

[eloff]

It's better in some ways and worse in others. It could be a lot easier to hide a key than a gold bar. You could still use bitcoin to buy your way to freedom, and there would be a black market for it if there's any way to get online, which there will be. The value is supported outside the country.

It's not clear to me that gold is superior in that use case.

[starkd]

Aside from some industrial uses, gold really has no intrinsic value aside from cosmetic. And cosmetic use is really just shared appreciation. There's really no reason btc couldn't offer shared value as medium of exchange in the same way fiat currency serves. Just depends on enough people who agree to use it.

[adventured]

Your aside is an extraordinarily large aside and yet you casually toss it in there.

Humans have a nearly unlimited desire for luxury goods and always will, quite predictably. They lust after jewelry accordingly and have for many thousands of years. Nothing about that will change. The aesthetic demand for gold will remain so long as people continue to desire luxury goods.

If you drop the price of gold low enough, people will start rampantly decorating their walls and consumer goods with it. It has potent intrinsic support under the price, as much as anything can. It will remain scarce and desirable.

[eloff]

Most gold isn't used in jewelry either, so it didn't derive much value from a fringe use.

Ironically we go to huge effort to dig gold out of the ground, purify it, and form it into blocks and coins. Then we dig a new home in the ground, bury the gold in there and put guards outside the door. Someone here pointed out how aliens would be scratching their heads over our behavior if they could see it.

[lazylizard]

i posit if asians, especially the indians, get tired gold jewellery , the metal wouldnt be worth nearly as much.. haha

[wtf_is_up]

This is a paraphrase of the famous Buffet quote.

[renewiltord]

The intrinsic value of gold is a fraction of what it trades for.

[bitwize]

There's no such thing as intrinsic value. Gold has value because humans value it. Humans value it basically because it's shiny and somewhat rare, but the value is something we project onto it.

[adventured]

Yes there is. It's pretty obvious that intrinsic value here means something that is very reliably valued by humans.

Nobody thinks intrinsic value for gold means that the universe likes wearing shiny gold jewelry and that places a floor under its value.

[tehbeard]

Missing its wide applications in modern electronics, but ok.

[eloff]

Fringe applications you mean.

[eloff]

It is a fringe application, regardless of downvote. Usage in electronics is probably less than 1% of the demand for gold. That's the very definition of fringe.

[rootusrootus]

> Usage in electronics is probably less than 1% of the demand for gold

It's actually 7.5%. Maybe you consider that fringe. How does it compare to bitcoin?

[tanelpoder]

Also, what happens when the power is out? Texas power grid was apparently a few minutes from completely collapsing recently, with some estimates that it'd take up to months to get it fully back online (and what does electricity cost around that time?). Or if a weather event seems too local, what about a major solar flare that takes out transformer capacity for years? (and it would be expensive for a long time). One could revert back to cash and gold without power, but bitcoin transactions?

Edit: I guess the summary would be that cash & gold are decoupled from electricity (even if it takes some to create/mine them), but Bitcoin's entire existence depends on continuous availability of (cheap enough) electricity.

[civilized]

Who needs digital gold? Why not just trade ownership rights to actual gold? We used to have gold-backed paper money and you can easily trade gold electronically today.

[eloff]

By putting it in a central database? We already do that. If wager you can probably buy gold online which just changes digital records while the gold doesn't move in the vault.

If you don't trust the bank our government you can put it on a blockchain. It sounds a little silly to us, but remember half the world lives in non free countries. So trust in government and institutions is a big concern. But then why bother with the gold? Proof of work ensures scarcity. So just drop the gold from the equation and now you have bitcoin.