Infinitely divisible bitcoin calculator
Bitcoin and other crypto-currencies experienced massive infinitely divisible bitcoin calculator in prices in recent times. In the last one month, the price of Bitcoin has almost doubled. The same is true for other crypto-currencies. Many are comparing this phenomenon to the Tulip Mania of the 16th Century. However, Tulip Mania happened in a far distant past and this comparison does not seem to have any effect on the enthusiasm of investors. In order to understand Bitcoin Bubble and how it will burst, we need to infinitely divisible bitcoin calculator one of the fundamental questions of Infinitely divisible bitcoin calculator, i.
To understand the value creation of Bitcoin, we need to understand its origin from Blockchain technology. The Blockchain technology used in Bitcoin first appeared in a white paper by someone using the pseudonym, Satoshi Nakamoto. The true identity of the infinitely divisible bitcoin calculator is still unknown.
Using the technology, massive calculations need to be done by a large number of people to verify transactions. The process is known infinitely divisible bitcoin calculator mining and the individuals who conduct the mining are known as the miners. Bitcoins are rewards of successful completion of the calculations.
Therefore, the minimum price of a Bitcoin is the cost of conducting the calculation for obtaining a Bitcoin. The mining today needs to be done using something like supercomputers while the electricity consumption of these calculations are tremendous. Infinitely divisible bitcoin calculator high price of a Bitcoin reflects the cost of the current mining of a Bitcoin. The value of a commodity also reflects our willingness to pay for that particular item.
For example, there is a cost of gold mining, however, the price of gold also reflects our willingness to pay for gold. Similarly, the price of a Bitcoin should reflect our willingness to pay for a Bitcoin.
The obvious question is, what is the use of a Bitcoin? For example, gold is used for transactions. In addition, gold is used in jewellery because of our perception of it as a unique and a beautiful metal.
The Blockchain technology states that the Bitcoins can be used for transactions and the transactions made using the Blockchains are cheaper than the usual mechanism of transfer through banks or third parties.
However, Bitcoin has no other unique characteristics. Gold is a unique metal and that uniqueness is valued by us. There is no close substitute for gold. The use infinitely divisible bitcoin calculator Bitcoin is easily substituted by another crypto-currency.
For example, a company wants to use a crypto-currency for remitting money from the UK to Japan. Infinitely divisible bitcoin calculator order to obtain it, the company decides to opt for mining. Bitcoin now involves a very costly procedure.
To be honest, this currently has no cost advantage over other crypto-currencies in facilitating transactions. We should also note that the acceptability of currency is an important factor here. At the moment, there are many crypto-currencies in the market. One may argue that there is no need to mine new Bitcoin; instead, a company can just buy Infinitely divisible bitcoin calculator from the market and use that to remit money.
For example, someone wants to send pounds to Japan. There is no need to buy a whole Bitcoin as crypto-currencies are infinitely divisible. Both Bitcoin and Litecoin have the same purchasing power, however Litecoin needs to be infinitely divisible bitcoin calculator to Bitcoin in most of the exchanges.
Therefore, there is an additional cost of using the Litecoin. This should give Bitcoin a cost advantage. A maximum number of 21 million Bitcoins can be mined due to the initial protocol set up by Satoshi Nakamoto. It is hence argued that Bitcoin is a precious asset. This is a just an illusion. Crypto-currencies are infinitely divisible.
A single gold dust has no use and. On the contrary, this is not a problem in the cryptocurrency world. On the other infinitely divisible bitcoin calculator, the limit of mining is a disadvantage.
This implies a limit of the coverage of information containment of a Blockchain in both spatial and time dimensions. That will eventually make Bitcoin and other early Crypto-currencies obsolete in the future. The biggest challenge comes from the free entry into the market. The crypto-currencies can be substituted in actual transactions. Meanwhile, new entrants will come with improved technologies to deliver cost advantages, thereby having market dominance.
As long as there is abnormal profit, this free entry will continue. Infinitely divisible bitcoin calculator unusual profit from a crypto-currency therefore is a short term phenomena. Bitcoin enjoyed this appealing image for a long period though this may not be the case for other such currency. Predictions state that bythe limit of 21 Million for Bitcoin mining will be reached. As the mining cost infinitely divisible bitcoin calculator already very high, the future miners may not mine Bitcoin anymore and the limit infinitely divisible bitcoin calculator never be reached.
Will Bitcoin still be transacted in the future? This also seems unlikely. The entrants will come with new effective solutions to transaction problems. Current Blockchain platforms will be driven out of market. There is a possibility that the new technologies will incorporate the existing Blockchain, obviously, subject to the technological feasibility of that incorporation.
However, this incorporation does not ensure existence of a strong future market for the current Blockchains. The current Blockchains will be like ancient underground cities smothered and obscured by modern megacities. Therefore, my prediction is that the Bitcoin and other crypto-currency bubbles will bust hard and be out of the market. Your email address will not be published.
Written By Mehdi Chowdhury 23rd Dec Understanding Blockchain Technology The Blockchain technology infinitely divisible bitcoin calculator in Bitcoin first appeared in a white paper by someone using the pseudonym, Satoshi Nakamoto.
Initially, the cost of these calculations were very low; now it is very high. Value is determined by our perception Similarly, the price of a Bitcoin should reflect our willingness to pay for a Bitcoin.
This cost effectiveness gives Blockchain the edge over banks or third party based transactions. Question is, which crypto-currency will the company mine? Bitcoin has become expensive to mine Bitcoin now involves a very costly procedure.
These crypto-currencies first need to be exchanged infinitely divisible bitcoin calculator Bitcoins, and then to regular currency. Though Bitcoin presently has monopoly, this will possibly change in the near future One may argue that there is no need to mine new Bitcoin; instead, a company can just buy Bitcoins from the market and use that to remit money.
I feel this advantage will not last long. Cypto-currencies are gaining widespread acceptance, along with their direct exchangeability. The fallacy of value It is hence argued that Bitcoin is a precious asset. These 21 million can be in the hand of 1 million, 21 million or, 1 billion. Phenomenal profit signals fast falls! Hence, The Bitcoin mining is likely to experience a shutdown before There can be only short term trading gains, lasting for the next 1, 2 or 5 years.
Mehdi Chowdhury 23rd Dec More from this infinitely divisible bitcoin calculator. Is peace on the horizon? Modi and Xi set laudable objectives but the devil is in the implementation Infinitely divisible bitcoin calculator A thing of the past?
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I've read that bitcoins are infinitely divisible:. How is this possible programmatically? The only thing that comes to mind are floating points which are inaccurate. This question has been asked before and already has an answer.
If those answers do not fully address your question, please ask a new question. Bitcoins are only divisible down to 8 decimal places same FAQ you referenced. If there is a need for them, additional decimal places can be added with infinitely divisible bitcoin calculator of the network. This is why some refer to "infinite" divisibility, because we can select the level that we need as time goes on. I have trouble imagining the need for such a thing, unless destroying bitcoin becomes a prevalent method of use.
If it is needed the potential is there and will never dilute your held bitcoins, which actually makes it a problem some would love to see the infinitely divisible bitcoin calculator to solve. Questions Tags Users Badges Unanswered. Bitcoin Stack Exchange infinitely divisible bitcoin calculator a question and answer site for Bitcoin crypto-currency enthusiasts. Join them; it only takes a minute: Here's how it works: Anybody can ask a question Anybody can answer The best answers are voted up and rise to the top.
How is bitcoin infinitely infinitely divisible bitcoin calculator This question already has an answer here: Why can we have small fractions of a Bitcoin? CoinEnablers That should be an answer, because it is actually what is being asked. CoinEnablers 3 6. By that standard, why isn't every crypto infinitely divisible?
Thank you so much in advance! The values in the bitcoin network are stored as the number of satoshis they are made-up from. Gracchus In theory, every cryptocurrency modeled after bitcoin could be retrofitted for more or less decimal places. Some altcoins have made changes to these parameters already, but so far I have not seen anyone who has tried to alter one after issuance.
Murch, that is an example of one of many technical details that would need to be solved. Check bitcointalk for more detailed discussions, there are several threads along this topic IIRC with actual core developers commenting. Tadge Dryja explains why 8 decimal places is not enough: Stack Overflow for Teams is Now Available.