Silk Road forums
Discussion => Security => Topic started by: namuld on November 29, 2012, 06:59 am
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Total number of Bitcoins hits 10.5 million, production halves to stop inflation
Can technology replace the Federal Reserve?
By Adrianne Jeffries on November 28, 2012 10:44 am
The total number of Bitcoins in circulation just hit 10.5 million, triggering a safeguard against inflation that was hardcoded into the digital currency. This means a drastic change in the number of new Bitcoins being created, which is expected to have a huge impact on the economy that has been developing around the ecurrency.
The safeguard has to do with the "block reward," the number of Bitcoins that can be created at a time, which has dropped from 50 to 25. Bitcoin miners, geeks who configure their own computers to mint the cultish digital currency, have been waiting for this moment for a long time — about four years, which is how long Bitcoins have been in circulation.
"The sudden scarcity of new coins is likely to drive the value of Bitcoins up"
The sudden scarcity of new coins is likely to drive the value of Bitcoins up, as fewer new coins enter the system and current Bitcoin owners hoard their stashes. It's also possible that the change will simply trigger a period of instability due to the sudden change in the money supply. Another factor could add to the turmoil: new chips custom-built for Bitcoin mining will make the process many times more powerful and efficient.
Exactly who designed Bitcoin is still a mystery. However, the ecurrency was engineered so that the technology could automatically adjust itself, replacing the need for a central monetary authority like the Federal Reserve. The block reward change is just one of many safeguards built into the protocol, which has been hailed as a masterful technological and economic accomplishment.
Bitcoin has been hailed as a revolutionary populist movement, but it's also a grand economic experiment. The market's reaction in the coming weeks will be the first major test of whether technology can replace government's role in regulating money.
Source:
hxxp://www.theverge.com/2012/11/28/3701434/total-number-of-bitcoins-hits-10-5-million-production-halves-to-stop
Further reading:
hxxp://bitcoinmagazine.net/block-reward-halving-a-guide/
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Well, no immediate big jump as the reward is halved. It's gone moderately upwards though.
As a casual miner, it is quite frustrating to all of a sudden get half as much reward as costs (electricity) remain the same or go up.
If asic hardware ever makes it's way into peoples hands, that will certainly add another level of difficulty.
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It was below $10 not long ago and today avg. is $12.40 as I write this. I will take 12.4% +/= appreciation in two months. I project around $15 by the first of the year as people begin to not only realize this time has come and we see a nice bounce to the upside.
Luv
PG
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So what do people think 1 BTC will be worth in 1 week or 1 month?
Still around $12 USD or potential for major shifts downwards or upwards?
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So what do people think 1 BTC will be worth in 1 week or 1 month?
Still around $12 USD or potential for major shifts downwards or upwards?
As the dust settles on the 50% reduction in hash rate and people like me keep hoarding them, the use of BTC keeps expanding, etc. I can only see them rise via supply and demand. I see a $15 - 20 range within the year. Mind you, there will be allot of turbulence but I don't think you can go wrong buying on any major dips (<$10 if you see those prices again) and expanding your portfolio with more BTC as one of your high risk/ high reward investments.
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That's kinda what we're thinkin... gotta pay the bills in the meantime though :-\ makes hoarding difficult, really wish we could now though
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I'm expecting $20 per by the end of the year. Trying to unload everything now to have that BTC before it pops.