Further the vague wording about the supply size means it is unlikely that it would hit bitcoins level of value because there is no scarcity.
Satoshi easily could have chosen a linear algorithm anticipating additional work input with more users, instead he designed a system to exploit late adopters.
The aspect of Bitcoins having a limited supply is mostly ineffective, as all the features of Bitcoin are now available in other service networks which are including more advanced features and better ASIC resistant algos.
Are you suggesting he provides a bigger reward for work as time goes on, thereby providing more currency later in the piece?
That would be counter-intuitive to the idea of bitcoin as a fixed store of wealth (strong libertarian influence, anti-bank ethos being kinda the cornerstone of the origins of bitcoin).
His plan was that the transaction fees would be what sustains the miners due to bitcoin being worth a lot once the block reward was low. The deflationary nature was not "manipulative" in the way you are implying, it was done in order to slowly wind down the reward and currency generation so eventually the transaction fees were the purpose for mining.
>The aspect of Bitcoins having a limited supply is mostly ineffective, as all the features of Bitcoin are now available in other service networks which are including more advanced features and better ASIC resistant algos.
Whether or not this is true is neither here nor there, the effectiveness is non consequential when it comes to the intent. He was not attempting to exploit late adopters.
Yes.
The minting design Satoshi choose merely granted a few users the majority of the supply for the least amount of work. They can then horde and hope to sell at a profit to late adopters.
>That would be counter-intuitive to the idea of bitcoin as a fixed store of wealth
No, the total supply remains the same. Distribution and production is the issue. The linear curve should align to match the energy and work input, assuming that is representative of additional users joining the network.
Fixed store of wealth is even more difficult to achieve, as users must trust the design to be desirable.
I understand what you are saying (even if I disagree with the concept), but I think you are missing that this was created as a run away from the GFC, heavy inflation would run a counter to what libertarians and anti-global economics people would believe in.
I didn't say anything about your particular opinion on wealth distribution on crypto, I'm just saying your opinion that satoshi was attempting to exploit people is baseless.
The end result is early users exploiting users who join the network after them. Ponzi style.
Imagine someone tells you they've created a money printing machine that prints 21m BTC, and they design the machine to give them most of the BTC and when it arrives in your town the man says "well it looks like the rules have changed now and your work isn't worth as much as my work because you encountered the magic box after me"
The users who ran the software on the network in 2010 required much less value input to generate bitcoins. Acording to Satoshis design, a user running the software now on an identical computer would not produce the same rewards for their work. This is essentially an intentional ponzi design.
Users who aquired bitcoins for low capital input are incentized to psychologically convince late adopters to purchase their bitcoins for more than it cost to produce and acquire.
The semantics matter here. Perhaps the later comers were more opportunistic and optimistic about the likelihood of achieving a favorable return. But they had to take more risk, since they were later to the party and risked more capital (as you noted).
The output is actually completely inverse. More work, more users, less output.
The consistency you're thinking of is likely the algorithm that adjusts blocktime to 10 minute intervals.
Penalising late adopters is just the reverse of rewarding early adopters and bitcoin needed early adopters to keep the network alive so it makes sense to reward them. I dont really buy that late adopters are being penalised though.
If OpenOffice team gives out their software for free, does it mean that Microsoft is somehow morally evil for selling their own Office package?
Difference between effort/expense does not seem to be important here, the point is that Ethereum developers put something real into it (work, resources, etc - quantifiable and provable), for which they claim that they should be reimbursed in form of a pre-mine. This information is publicly available, and known by most network participants, who still voluntarily participate in it. I don't see any problem here.
this is the nature of all the PoW coins. The early contributors take the most risk and the most reward (if the coin succeeds).
No, Satoshi did not "premine" bitcoin. Premine means on day zero you have created currency for yourself already. The only block we know Satoshi did mine cannot be spent. There is also zero evidence that Satoshi mined additional blocks once the network got up and running. (It took days for the second block to be found.)
The difficulty curve often further benefits early miners to be taking minimal risk when the design is reverse logarithmic.
Early adopters invested almost nothing compared to the amount of money moving around now (at risk on a speculative investment). Their risk was negligible and certainly far less than folks getting into the game now, coin for coin.
You’re right that if one buys 0.05 btc today for $400, it’s the same risk as someone investing $400 years ago to mine hundreds or even thousands of coins, but real investors aren’t buying 0.05 btc.