[kromokromo]

Bitcoin as a digital store of value is fine. It makes sense to store money in something digital and secure to hedge against local instabilities in currencies, governments etc. People store money in it because it currently secure and it been battle tested, nobody has been able to hack it.

However, I am concerned about the security model on a 5-10+ year perspective. Miners secure the blockchain and get paid for it in bitcoins. We have seen that the mining has become more and more sentralized as the mining gets progressively harder (as by design). Progressively harder mining means that the price of bitcoin must rise in pararell to cover the expenses of the miners securing the network.

Here are my concerns:

- Increasingly centralized mining means a higher risk of a 51% attack (controlling 51% means you control the entire network).

- Bitcoin not able to maintain a constant price growth that will lower the incentive to keep mining as the difficulity increases.

- Quantum Computing actually cracking the encryptions which will kill the entire network instantly.

- Instability in the world might lead to spikes in electricity prices, which will affect the incentive to secure the network with mining.

I also think spending so much energy on security, when there are other viable options available is insane in our current age.

Transitioning to a Proof of Stake model like Ethereum instead of a Proof of Work model would be much more robust with a fraction of the power consumption, but thats just my opinion.

[cechmaster]

if quantum computing cracked encryption, everything secured on the internet would be in trouble, not just btc

every 4 years there is a halving event where the btc reward is cut in half. Eventually all btc will be mined and the only role of miners will be to process transactions and they get to keep the fees. that will be the incentive

i agree, Ethereum might be the better approach.

i'm not too concerned about the electricity usage in the long term. for btc it will be less and less profitable for miners to operate consuming large amounts of energy. as the price plateaus and mining rewards decrease, energy consumption should also plateau. that is if energy price stays the same and doesn't become cheaper.

[danbruc]

Progressively harder mining means that the price of bitcoin must rise in pararell to cover the expenses of the miners securing the network.

I stopped following Bitcoin closely a decade ago, so I might be wrong, but I think the issue is the following. Mining was supposed to be eventually financed by transaction fees instead of the mining reward but the usage of Bitcoin for payments never really materialized. So there are not enough transactions to pay for the mining costs at reasonably low transaction costs. This also interacts with the low transaction limit of Bitcoin, even if people wanted to use Bitcoins for payments at large scale, there is no capacity for that. And the other way around, without the necessary capacity, transaction fees will be high, which will deter people from using Bitcoin for payments.

[bufferoverflow]

> Quantum Computing actually cracking the encryptions which will kill the entire network instantly.

It will not. This issue was talked as far as 2012.

https://en.bitcoin.it/wiki/Quantum_computing_and_Bitcoin

[cykros]

Everything you've just brought up as a concern is addressed, and more, over at https://endthefud.org

The energy use is a big one people who don't think it through keep coming back to (thanks to the WEF planting this bogeyman back in 2017 or so). Miners do not operate when the cost of electricity is high, for economic reasons. What they do, however, is look for stranded power. This has led many to operate where gas is otherwise being flared, as well as on wind turbine and other green power sources, making it economical to build them out as it creates demand. That demand in turn falls off if other use for the power materializes, but is there to pick up the slack if the surplus re-emerges.

These are a few examples, of which you'll find many if you bother to look. Bitcoin in many ways serves as a battery to balance demand for energy, and may well be one of the greener initiatives out there. Which certainly can't be said for traditional banking infrastructure.

[throw0101d]

> Bitcoin as a digital store of value is fine.

It is not. It has multiple >70% drawdowns over the last ~decade:

* https://newhedge.io/terminal/bitcoin/price-drawdown

During the 1930s US stock market crash, things went down 90% and, a century later, has never been that bad. Bitcoin has had multiple Great Depression equivalent drops in one-tenth the time.

Something that is a good store of value should not be volatile: it should keep it's value, or at least be fairly predictable in the rate of decay.

[bufferoverflow]

> Something that is a good store of value should not be volatile

If it mostly goes up, it's still a good store of value, even if the volatility is high.

So far it outperformed every fiat currency on the planet.

[throw0101d]

> If it mostly goes up, it's still a good store of value, even if the volatility is high.

So does the stock market, but if I want to buy a house in 2025, I don't keep my downpayment savings in the stock market but rather in a savings vehicle that protects the principal. I don't want something that goes down (or up) regularly if I want to store value: I want something that is predictable so when I go back to it to spend it (the whole point of currencies) I have a rough idea of what I'll have to work with.

> So far it outperformed every fiat currency on the planet.

The point of currencies is not performance but stability.

[gobindoriu]

How does a new thing become a store of value?

Could it be that there is a path to medium of exchange ->store of value? -> unit of account?

That could explain the volatility while the market prices it correctly

[throw0101d]

> That could explain the volatility while the market prices it correctly

Even if we grant that, Bitcoin has probably not reached that point (yet?).