I've been wondering about the impact on the network when the end of bitcoins that can be mined comes within sight. Is the computational load going to be taken over by centralized wallet stores like Coinbase?
It's supposed to be a limit function, right? Payout will be ever-decreasing, and difficulty will adjust to keep mining modestly profitable forever.
What I wonder about is the size of the blockchain. Bitcoin is young and fringe, and the blockchain is already several gigabytes. What happens when everyone and their brother uses Bitcoin, every day? How large will a few decades of frequent, widespread global usage make the blockchain?
Supposedly VISA processed 20 billion transactions in 2006. To my knowledge bitcoin transaction occupies ballpark 1kB in the blockchain; that's 20-100TB/year, and it could be even larger when you add money-moving transactions. That storage need can be met, but only by people making a big investment in the network- in other words, centralizing the trust of the network to players with deep pockets and compromising one of the original goals of BTC.
> It's supposed to be a limit function, right? Payout will be ever-decreasing, and difficulty will adjust to keep mining modestly profitable forever.
This only works as long as bitcoin climbs in value vs the rest of the world, no? Wouldn't a long period of price stability break this down?
> What I wonder about is the size of the blockchain. Bitcoin is young and fringe, and the blockchain is already several gigabytes. What happens when everyone and their brother uses Bitcoin, every day? How large will a few decades of frequent, widespread global usage make the blockchain?
My theory is that it will force Bitcoin to slowly re-centralize, with people who provide web interfaces to wallets shouldering the majority of the burden.
No, bitcoin doesn't have to keep climbing in value. The mining difficulty can be adjusted downwards as well as upwards, so even as payout decreases and/or BTC value drops, mining will remain modestly profitable.
A PhysOrg.com article reports on a 2009 study by Mark Kryder. According to the report, if hard drives continue to progress at their current pace, then in 2020 a two-platter, 2.5-inch disk drive will be capable of storing more than 14 terabytes (TB) and will cost about $40.
Huh? 1tb hdd was released in 2007, 2tb in 2009 and 4tb in 2011. Looks exactly like Moore's law to me though we've been set back by Thai floods of 2011.
