Can Bitcoin Grow Faster Than the Internet? | Hacker News Reader

Can Bitcoin Grow Faster Than the Internet?

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20 pointssturza27 comments

Someone posted this graph[1] recently showing how Coinbase application installs have dropped off significantly in the last few months.

It makes me wonder how much growth there is left if adoption amongst casual users has declined so precipitously.

1. https://twitter.com/Dogetoshi/status/1412465283181260811

> With about 130 million users, bitcoin is now at a similar inflection point where the internet was in 1997.

Bitcoin doesn’t have 130 million users. I’d be surprised if it had 130 thousand users.

Bitcoin has 130 million speculators with FOMO.

What even is a bitcoin "user"? Like, seriously, are we talking about people transacting with it for purchases? Or just accounts that have some share of a coin in them? What are we even measuring here?

They measure (estimate, really) based on how many wallets/address exist on the blockchain.

Pretty dodgy approach though, because there are various services that provide Bitcoin "functionality" for many users with a handful of wallet addresses, or use many different wallet addresses to mix/launder transactions.

Better than nothing. A lot of estimates I've seen try to solve for these issues but there isn's a completely clean way to do it.

Yeah, difficult to correlate number of addresses with users. Ethereum is probably a better approximation since users there tend to use a single address for everything.

Another way I estimate usage/adoption is looking at Google Trends and comparing it against something I can use as a baseline (in my case "reddit"), right now Bitcoin averages around ~30-40% of search query volume compared to reddit [1] (and even more if you look at worldwide queries) which is obviously not perfect comparison, but is an interesting datapoint.

1: https://trends.google.com/trends/explore?date=today%205-y&ge...

Without mainstream acceptance through purchase transactions Bitcoin has no hope of going anywhere. People holding for investment, while profitable, is absurd if ultimately the final holder can not exchange it for goods. I am not an economist, but I do hold the position that money is used for the exchange of goods and its only value is in its acceptance and exchange rate.

People hold it because historically it appreciated greatly, so they expect that to continue. But it can't appreciate the average of 300% YoY forever, sooner or later, it will hit diminishing returns at which point people will be more willing to spend it.

It's essentially Gresham's law in action[1]. Also for those that want to spend it, there are lots of options now for crypto backed debit/credit cards.

1: https://en.wikipedia.org/wiki/Gresham%27s_law

What about gold? It's been around for thousands of years first as a medium of exchange and today as store-of-value, but is never used for transactions today. That's doesnt make it "bad money", it just makes it different than a currency.

so what bitcoin (and of course other crypto) is, is complex and ultimately subjective : it's different things to different people, just like money.

It does some things money can do & does some things that money cannot. FIAT money is the same, It does some s bitcoin can't but cannot do some things bitcoin can.

instead of advancing a concrete definition of crypto - which as i said is a subjective argument - i'd encourage you to look at what money, monetarism & fiat really are.

It's equally subjective, and arguably a more difficult concept that crypto.

At the moment, traditional cash can be spent much more freely than crypto, which is one of things limiting it's utility as a currency. But similarly, the lack of an immutable ledger, a practically infinite(or a least unknown) supply, and risk of physical counterfeits limits Cash as store of value.

....right now...crypto is something. Even if it's yet to be fully realised. It's mainstream, at least as an investible asset and It has some utility as currency, albeit limited.

For people in developed countries, with established currencies backed by a military force, either directly of indirectly, it will seem quite absurd that crypto could/should replace cash.

For people in unstable regimes, countries who've experienced hyperinflation, it's a massively attractive proposition.

You should do more research! Many people living in countries with crumbling economies are actively using bitcoin. Venezuela, El Salvador, Nigeria, Ghana, Kenya, Zimbabwe, Eastern Eruope, etc etc.

You may be asking "what? bitcoin too volatile!" well, it's all relative. In a lot of these places the national currency is even more volatile, or even worse, there is no financial structure for people to save and invest. Bitcoin changes that.

Have you done actual research yourself or is this also a gut feeling?

The number of active address per day is currently about 750,000. For a supposed population of 130,000,000 users that's 2 transactions per year per user.

~50,000,000 Americans own bitcoin and I highly doubt it's because of the crumbling economy or USD failing. Same for the vast number of UK/Spanish/French/German speculators with either a strong country currency or the Euro to fall back to.

Then there is the matter of transaction times, 10 minutes is good. 20 minutes is common. 30 minutes isn't unheard of. Other than speculating large sums or transferring large amounts between regional currencies what could the average person use bitcoin for? A 20 minute checkout delay while grabbing bread? There are other crypto options that solve this problem, why would people be using BTC even if crypto was their answer?

It's not that there is nobody on Earth that uses Bitcoin instead of speculates with it it's just a tiny minority of that 130,000,000 number. I'm sure there are some places that find value in a place to store cash for long term but you're listing places like Nigeria where half don't even have power yet is supposed to be crypto usage heaven?

I've done research myself. Thanks.

You should read about Lightning Network.

Could you mind sharing which hard data you found in your research which makes the above data incorrect then? Talking about how much research you've done isn't a counter to someone sharing their disagreeing research with you.

I'm aware of the lightning network, I'm also aware less than 1% of this 130,000,000 could possibly be using it at current scale right now. It's not a debate about what could be done it's a question of how many actually are.

I only brought it up because you asked, but no, not worth my time to dig up the data and articles. This is a journey we will all go on.

Here is a simple article to get you started, but I promise, there is a lot more info out there if you seek to find it:

https://www.yahoo.com/lifestyle/countries-using-cryptocurren...

Again that's ownership rate not user rate. It's also all about "crypto like bitcoin" not "bitcoin".

I can see why countries with f'ed local currencies might embrace BTC (in same way they usually have a parallel USD system). But surely the transaction costs kill any use as a replacement for cash?

like tesla

Tesla has future cash flows. Bitcoin is ones and zeros.

I don't know if you think its clever somehow, to wilfully avoid the point & attempt a low brow straw man, but I can tell you that it isn't.

Oh I’m sorry. What was your point?

And I don’t think it’s a lowbrow straw man to point out that stock has some fundamental value as the present discounted value of future cash flows, and Bitcoin doesn’t.

TSLA has far more speculators in the stock than users of the product - which was the criticism levelled at bitcoin by OP

You mentioned TSLA has future earnings, which is true, but it has 12bil of debt of the balance sheet too. Bitcoin has no debt on the balance sheet..

More significantly, TSLA is trading at a normalised P/E ratio of >700. For comparison, FORD is about 14. This says that unequivocally people believe TSLA is far, far, far more valuable that the sum of it's parts. Just like bitcoin.

This should be about the growth of Cryptocurrency and not bitcoin.

hows this front page.

its a pointless comparison to measure btc to internet growth rate.

of course any internet based platform will have a higher growth rate than the adoption of internet itself.

HN algo biased towards crypto ;)

I can think of many internet-based platforms that had a much lower growth rate than the internet.

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