Is Luna not run off of Bitcoin?
So if Luna could function as a Ponzi scheme, why doesn't Bitcoin inherently have that same capability or function embedded into it? Or is there something preventing that from happening with Bitcoin?
Confused.
BTC's max supply is capped and the release schedule of new coins is fixed and predictable. There is no possible way that trillions of new bitcoins could suddenly be created.
That's a slightly strong perspective; it is not impossible; it is merely extremely hard.
Care to elaborate how it could be done?
Even if it were to happen, which it could not, the chain would fork from the moment before the hack and continue on without the hack.
The only reason we're not calling "Bitcoin Cash" by the name "Bitcoin" is that the last part didn't happen, right?
Even here, you’ve assumed such an event would be a hack. Sure, one is not going to introduce trillions of coins, but a fast way to design a desired SHA-2 solution is a lot of cryptocurrencies’ factorization heel and played correctly could slowly make one incredibly wealthy (played poorly, it’d just collapse the entire currency and probably the whole idea).
You know how we’re all terrified of fast factorization and its implications for cryptography? Do you really think with the basically five minutes of research the industry has into quantum computing that SHA-2 is good enough for the entire life of a currency? We’ve already shown that coins can’t fork to change stupid shit, so I mean, good luck with an owned hash. So, hard, not impossible. Just don’t forget: once upon a time we thought MD5 was awesome and you’ve never heard of MD4.
However, remember we’re discussing the creation of trillions of bitcoin. Even if it occurred, do you really believe the chain would remain? It would be forked. I just can’t imagine a chain being totally compromised and its users being okay with it - both would need to be true.
That said, SHA-2 being broken is not very high up on my list of cryptocurrency failure modes if only because there are much more immediate concerns... and I suspect most other people implicitly feel the same way.
Either someone puts up an enormous amount of computational power to flood the chain or someone finds a fatal flaw in sha256 and uses that to flood the chain. The former is basically impossible, the latter is just very unlikely. Either way, if someone manages that feat, we can consider Bitcoin practically broken.
It's this single point of failure ("one" controller vs. distributed to diversify risk) that you're stating is what makes it a true Ponzi vs. Bitcoin?
But it's definitely looking like "anonymously drop a protocol and disappear" was a smart move.
All these Ethereum-based token coins seem like they're trying to answer the question "what if Bitcoin had a central banker, but it's a kid in his 20s with a CS degree?"