What Drives Bitcoin Fees? Using Segwit to Assess Bitcoin's Long-Run Sustainability | Bank of Canadawww.bankofcanada.ca/2022/01/staff-working-paper-2022-2/
45 sats \ 5 boost \ 5 comments \ @cryptocoin 11 Feb 2022 bitcoin
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10 sats \ 0 replies \ @nout 12 Feb 2022
Is it just me or is the article completely confusing correlation and causation of segwit adoption? It also seems to be setting fiat price of BTC at current levels as a constant.
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10 sats \ 0 replies \ @0268486dc4 11 Feb 2022
tl;dr: BOC predicts bitcoin's market cap in year 2040 to be about $30T, but only as long as security budget doesn't increase.
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12 sats \ 0 replies \ @cryptocoin OP 11 Feb 2022
We find that Segwit reduced fee revenue by about 70%. Fee revenue is maximized at a block size of about 0.6 megabytes when Segwit adoption remains at current levels. In addition, large sustained price increases are required to keep mining rewards constant in the long run.
The paper is available as a PDF: https://www.bankofcanada.ca/wp-content/uploads/2022/01/swp2022-2.pdf
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1 sat \ 1 reply \ @cointastical 11 Feb 2022
so the canadian central bank wrote a whole ass paper on the effect of segwit on Bitcoin fees (!?)
https://www.bankofcanada.ca/2022/01/staff-working-paper-2022-2/
https://twitter.com/nic__carter/status/1491982763490168832
this directly relates to a discussion @Truthcoin and I recently had about the convexity of fees relative to block space, and whether you can strategically curtail block space to target higher fee revenue.
https://onthebrink-podcast.com/drivechains
https://twitter.com/nic__carter/status/1491983685196959765
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0 sats \ 0 replies \ @cointastical 11 Feb 2022
More info on the podcast with Paul Sztorc (Truthcoin) here in earlier post on SN:
On The Brink with Castle Island - Paul Sztorc (Drivechain) on Bitcoin Security Budget and the Importance Merge Mining - Listen on Fountain #9368 https://play.fountain.fm/episode/6476544317 https://onthebrink-podcast.com/drivechains
"There is very little economics literature on fees in Bitcoin" -- gotta branch out, BoC. see my 2019 talk eg
https://twitter.com/nic__carter/status/1491985164368498688
And, nic__carter's Twitter thread, unrolled:
Thread by @nic__carter on Thread Reader App https://threadreaderapp.com/thread/1491982763490168832.html
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