Today and yesterday Bitcoin hashrate reached its highest ever -
https://decrypt.co/247721/bitcoin-price-down-hash-rate-all-time-high
Still the mempool (yes I know there's no 'one' mempool but still) fees are hovering around the 3-4 sat / vbyte range with the Bitcoin 'price down'. I can't help but feel that the market is expressing its true sentiment about 'crypto'.
Let me explain. In my opinion, why should I store my time, energy, and efforts in something that doesn't require energy to make? With a monetary policy that 'can be changed', that isn't grounded in the 'real world'? With fewer 'nodes'? That has a 'roadmap'? That has a foundation that's selling to cover operating costs? It sounds like an unregistered security and in my honest opinion a house of cards.
Bitcoin while not perfect if you even have a small miner requires real heat and real energy and you feel it when you heat your office or living room in the wintertime with a small miner. They're little space heaters... and this 'proof of work' is what separates Bitcoin from nearly 99% of all 'crypto'.
'Crypto' isn't decentralized. It is usually very easily changed by a small group of insiders, and users DO NOT emphasize running nodes or 'don't trust verify'. It's staking to stake to stake to get more 'air tokens' which require NO more energy and real-world-resource tradeoffs to make and manage. It's like a central bank that keeps changing the rules, changing the 'price of money' without the consent of users it is not stable. Or not based in physics (energy-based) where running a miner and running your washingmachine and turning on the lights... electricity is required for all these things and you can even see and feel it.
Ethereum (to be specific) is in a 40-month slump, exchange-rate wise, to Bitcoin. I won't post a screenshot here... but the 2-year chart is pretty brutal just trending down and to the right.
https://cointelegraph.com/news/ethereum-40-month-slump-bitcoin-dollar-freefall-scenario
And the thing is that the overwhelming majority of alts look the same way or worse. And the few that don't... aren't proof of work and aren't decentralized. They carry obscene amounts of counter-party risk, capture risk, technical risk, unregistered-securities risk (ie solana) with their primary use case being... memecoins and NFTs. With something exposed to all these risks from state-capture, centralization, and regulatory risk how can the accompanying blockchain be global money for competitors and enemies?
It can't. If your company and servers and offices are located in the United States why would Russia, China, and Iran, not to mention Asian or European countries and businesses or users trust you? It gets too big, too powerful, too advantageous for not-the-united-states and it gets shut down. By the United States.
Could Bitcoin be shut down? Maybe but it would be extremely difficult. To emphasize this point, Bitcoin doesn't have to be perfect it just has to be the best, far superior to any competition and it is in my opinion.
So to summarize, if the air-token chains (which are not decentralized) whose main use case is NFTs and memcoins cannot compete with bitcoin... what can? What else is proof-of-work?
Litecoin. A 'failed-fork' of Bitcoin that has 'bled-out' over the last 6 years (in terms of price and hashrate).
BCash. A 'failed fork', based on bigger blocks, that noone uses that has bled out 99% in price and hashrate over the last 6 years. (see the 6-year chart)
Dogecoin. Another 'fork' that while proof of work... is not a digital scarcity, has one-minute blocks (arguably effecting decentralization but that's a different topic) with different/inferior monetary fundamentals. It is also down 80% from its ATH in 2021 and I won't go into any more detail.
All of these 'failed forks' talk about their 'low fees' and 'fast transactions'... but their usage is a small fraction of that of Bitcoin. If the use of the blockchain is anemic with blocks that are nearly empty (BCash) sure fees will be low. Noone is using it! https://explorer.melroy.org/
90% empty blocks makes for a dead chain, in comparison with Bitcoin where the blocks are full and the hashrate is at all-time highs.
So these 3 don't offer anything over Bitcoin... is there a proof-of-work chain that offers something different or otherwise valuable? (Remember that proof-of-air-token-chains go to Zero). Maybe, just maybe Monero. Monero/XMR isn't from what I can tell a speculative memcoin, has no NFTs, and in fact is reasonably hard to acquire. Most countries and exchanges have delisted it... likely because of its privacy technicals so the people who hold it have really gone out of their way to buy it and find it. It really isn't used for speculation... because exchanges have delisted it.
Is it as decentralized as Bitcoin? No. With the hashrate equivalent to Bitcoin? No. Price-performance? No. Its monetary properties and anti-ASIC propertiesm relative to Bitcoin, are completely different... however its 'selling point' is its on-chain privacy.
Now without going into its 'privacy' qualities (that are very debatable in the real-world on-chain plus off-chain)... and block size and 'tail emissions'... Can Monero be global money?
I believe probably not due to regulation and other reasons.
Global money for individuals, businesses, corporations, banks, even nation-states or national treasuries will need a certain amount of:
Regulatory Compliance
Easily verifiable total supply
AML and KYC requirements (at least for corporations/funds/and trusts) and
Transparency for governments
Having every sender, amount, and receiver shrouded in mystery means that when banks and governments use that money they will never be transparent. Government does not volunteer transparency and won't be transparent using Monero either. Calls by the citizenry for governments to 'reveal their balances' or their transactions for accountability, to prove they have what they say they have will fall on deaf ears. They will be ignored. The German government sells their stack? No transparency on-chain. A business or potential ETF claims they 'have it'... no transparency on chain. Government with absolute opaqueness in transaction is extremely unlikely to volunteer transparency to the taxpayers and that is a big problem IMO. A government could run a massive deficit, have almost no XMR, lie about it... and it might be very difficult to prove otherwise until it is too late for the taxpayers and institutions.
In contrast to Bitcoin, it is not a compromise I'm comfortable with.
In addition any hint, suggestion, or even scant whiff of there being an inflation bug and the entire currency collapses. What bank or nation state is going to trust money that they can't independently verify, that isn't 'battle-tested', that won't meet the requirements of regulators, that is or can be associated with bot-net farms... Or could maybe, possibly, using complex cryptography not actually have a verifiable supply? Is a 1% chance of a supply-bug low enough for global money? For enemies and countries that don't trust each other? With all the complexity and risk factors in the world... probably not in my opinion.
With Monero there are tradeoffs, as in any engineered system, and personally I rather use Joinmarket and Coinjoins and a large anonymity set + lightning to achieve enough privacy. Global money is still verifiable and governments transparent-enough on-chain... with privacy achievable by plebs through education. Rather than the State saying **** *** no we're not telling you how much XMR we hold there's nothing you can do about it in fact there is zero transparency for the global ledger. To me it's kind of dystopian in my humble opinion.
In summary, as the world digitizes the development of a 'digital asset', a 'digital gold' or 'digital capital' is basically inevitable and the survivable of which is dependent on decentralization, proof-of-work, connection to real-world resources and energy, and being trust-less for enemies and competitors. In this world, with enough time and pressure air-tokens go to zero, and there is no 2nd best. The only surviving blockchains will be proof of work with 99% of the value, with Bitcoin probably having the vast majority of that.
Every time the market 'dips', it's one more chance for speculative assets and air-tokens to bleed-out against Bitcoin, for the 'alt-season' to never materialize, for the Wells notices to pile up, and for the rug-pulls, scams, and air-token exchanges to get hacked. Tonight the market has 'dipped'. And Bitcoin's Hashrate is at or near an all-time High. Enjoy thank you.
This fuckin' describes it all!