Quote:
Originally Posted by YourMother66
I'm just getting into the crypto thing and my understanding is:
Bitcoins purpose is to be a currency, but most people use it to speculate.
Etherium or other coins have different main purpose but can also be used as a currency.
For actuall transactions bitcoin is rather slow and expensive. Stellar is much quicker and cheaper
^Not entirely accurate...
Quote:
Originally Posted by YourMother66
Bitcoins purpose is to be a currency, but most people use it to speculate.
Bitcoin is specifically a 'proof of work' experiment that was used to demonstrate the validity of the 'Blockchain' idea... that no centralized entity was needed as a point of control in the financial area... it has proven EXTREMELY effective in this example. Currently it has morphed into a digital 'Store of value'... exactly as gold is a physical 'store of value'. Mainly this is because of it's limited supply and deflationary nature... and it's brand value (it was the first successful cryptocurrency).
Bitcoin continues to operate in the 'proof of work' arena where individuals can 'mine' mathematical/transactions and be rewarded with btc when their work is used. Roughly every four years, the rewards bitcoin pays out for the mining work is cut in half... and is currently down to just around 6 btc which is making it nearly impossible for any mining group to make decent money from the mining operation. this is because the costs involved are fairly substantial in terms of computing power needed and MOST IMPORTANTLY, the energy/electricity need to keep such an operation going.
Bitcoin has Value, and as such, can be used as a currency to make transactions, but as a cryptocurrency it is far to limited, slow and costly to really be used in an enterprise state.
Quote:
Originally Posted by YourMother66
Etherium or other coins have different main purpose but can also be used as a currency.
^Etherium is a giant decentralized network of blockchain nodes that operate in a idea that is different than that of bitcoins proof of work concept... this is called 'Proof of Stake' (POS). Instead of nodes in the network mining for a reward (like bitcoin) nodes buy into etherium and 'stake' their personal coins/tokens for a chance at a payout if their work is used. In addition to this, developers use this Etherium network to create decentralized applications (Dapp) that can be adopted by users... and as such etherium charges a fee for usage... (gas).
Because stakers have to put up their own coin in order to participate in the etherium blockchain, the chance of hackers and shady usage is somewhat reduced because if the network recognizes that your work is different than the majority of the other operating nodes, you can possibly loose your ETH.
Proof of Stake is the future for the time being, no proof of work idea is sustainable and cost effective.
Quote:
Originally Posted by YourMother66
For actual transactions bitcoin is rather slow and expensive. Stellar is much quicker and cheaper
while this is true... it's not the whole picture. at the 'enterprise scale' of these transactions and adoptions there are a few players... some are vying for dominance... Stellar is one... and Ripples 'XRP' is another. I think XRP is going to win that adoption at the state and enterprise level of transaction because it is much faster asit can produce more transactions per second and is cheaper to operate.
Last edited by MSchu18; 06-28-2020 at 05:57 PM.