Bitcoin’s Miner Fee Crisis Explained: A Reply To Joe Weisenthal
ryanresearch.substack.com
Bloomberg’s Joe Weisenthal permitted the fintwitterati to discuss Bitcoin’s existential problem: no one is using it. What exactly does he mean by this? The Bitcoin blockchain’s purpose is to enable users to send transactions that third-party entities, miners, process as financial intermediaries. The compensation incentivizes enough competition among intermediaries to prevent monopolization and fraud. These miners are compensated through an automated reward hard coded into the network software and a variable fee based on supply and demand. Bitcoin’s network software is designed to inevitably reduce the automated reward to zero in increments occurring about every four years. This makes the miner revenue generated from the variable fee component that much more important.
Bitcoin’s Miner Fee Crisis Explained: A Reply To Joe Weisenthal
Bitcoin’s Miner Fee Crisis Explained: A Reply…
Bitcoin’s Miner Fee Crisis Explained: A Reply To Joe Weisenthal
Bloomberg’s Joe Weisenthal permitted the fintwitterati to discuss Bitcoin’s existential problem: no one is using it. What exactly does he mean by this? The Bitcoin blockchain’s purpose is to enable users to send transactions that third-party entities, miners, process as financial intermediaries. The compensation incentivizes enough competition among intermediaries to prevent monopolization and fraud. These miners are compensated through an automated reward hard coded into the network software and a variable fee based on supply and demand. Bitcoin’s network software is designed to inevitably reduce the automated reward to zero in increments occurring about every four years. This makes the miner revenue generated from the variable fee component that much more important.