After halving miners must morph into Transaction Processors

As I write this we are just a day past the BSV halving, two days past BCH halving, and another 30 days before BTC halving.

A note on crypto prices

Price changes in alts follows the price of  BTC because alts are  mainly paired against BTC on almost all exchanges. This will remain the case unless we can decouple from BTC.

One way that this can happen is to pair against Tether (USDT). As of today it has a marketcap of 6.5 billion, an increase of about 2.5 billion recently. However Tether will need a much higher marketcap in order to replace BTC.

Another is if a clear winner to emerge out of the BTC, BCH and BSV hash war.

Mining Economics

For the next 30 days most miners will mine the BTC chain. BCH and BSV chains will revert to their foundation miners Btc.com for BCH and Coingeek for BSV.

Mining at a loss, hodling and waiting for the price to rise.

If the halving of BCH and BSV is any guide, BTC. will most likely maintain price prices on a bearish tone. This means that BTC mining will also be unprofitable.

It is unlikely that miners will continue to mine at a loss. Less efficient miners will have to leave until the difficulty adjusts for mining to be profitable again.

Some miners may decide to mine and hold until the price increases, but this is a risky proposition.

For BTC the Chain Death Spiral also threatens like "Democleas Sword".  BTC will be at maximum difficulty after halving, A huge drop in hashrate could trigger it.

Mining dynamics after BTC halving.

Opportunistic mining - On BCH and BTC difficulty is adjusted every block. Some miners will wait until the difficulty adjust low enough before they start mining on the chain. This is more noticeable on the BCH chain.

Price hodling - Miners leaving the BTC chain may choose to mine on BCH or BSV as the chance of these coins doubling will be higher because of it's lower prices.

Pick a winner - This will be hard to predict.

Transaction fee model - BSV wins as it is the only blockchain designed for this.

It is all about transactions

Bitcoin was designed for mining revenue to transition over to transaction fees. The halving in block subsidy was designed to incentivise this. It is incomprehensible how BTC supporters can ignore this simple reality? In the graph above we can clearly see that Fee percentage in blocks between BCH and BSV have diverge considerably after the halving. This trend will continue. BSV will continue to increase the number of transactions per block because it is designed for users to write data to the blocchain.

The major transaction volume on BSV are users writing weather data ( weathersv) and exchange data (preev) to the blockchain. However on the horizon are real enterprise users in supply chain management (unisot) (kowr) and medical data (EHR).


A new model for miners as transaction processors.

There will be a paradigm change. Miners need security of income in order to justify spending millions in hard and soft infrastructure. They will become transaction processors.

They will be able to contract with large enterprise users exclusively to process their transactions thus guaranteeing a reliable income stream. Such contracts will be hard to disrupt as a bond of trust will develop between the parties. It will also incentivise the miner to improve their service in order to keep their customers.

Buy the dip sell the top

For BSV supporters, an opportunity exist to buy the dip and sell the top until BTC halving because it will be volatile. Risky, but if you can time it right, there is an opportunity to multiply your holdings. Use wallets like Exodus, Coinomi and move between BSV and USDT. Warning - It is risky and very difficult to time the bottom and the top and too easy to get emotionally involved. Only risk what you can afford to lose. Remember most people "can pick it but cannot time it".

BSV flipped BCH in January but could not maintain the lead. In all likelihood BSV will again flip BCH before BTC halving. If this happens look for BSV to moon and win the hash wars as miners chase profits.

Paymail is here!! This is the Killer App for BSV mass adoption

Imagine paying someone by just sending money to their personal email address. Yes you can. This is Paymail and it goes into Beta today. The caveat is that it only works with a domain name address.

How it works.

Your email is the gateway to your moneybutton account. ( Relayx, Handcash )

1) You will need an invite to join the beta and you can do that through this link https://mypaymail.co/

2) Upon approval you will be given a mypaymail account example : 000@mypaymail.io

3) Adding new handles

In addition to your assigned handle you can create more handles as on the left side of the form. Each handle will cost $0.85 cents. You can use any amount of payment destination you wish.

4) What is interesting is the custom domian option on the right side.

If you or your organisation uses a custom domain for your emails, those emails can be linked to your payment destination. This means that anybody can pay you by sending money to your email address not your mypaymail handle.

I reached out to mypaymail on the process and they responded with this message.

"What DNS service provider are you using? Could you send me a screenshot of your zone editor?"

If you have a DNS provider that you have to pay for you can use the zone editor to enter the details.

and,

There is an easier way to set up the DNS records but it only works with https://www.ionos.com/ currently. So if you buy a domain from them, an autoconfiguration button appears and it will edit the DNS recods for you. 

IONOS by 1&1 » Your Host Matters. A lot. IONOS » The brand by 1&1 for Mail, Domains and Websites - We are the leading European Web Host und Specialist for Cloud Solutions. www.ionos.com

also interesting is 

"We are not far from getting Godaddy support, hopefully I will hear from them this week."

This is a huge development for BSV. You can actually pay a real active email address!! 

But!!! Yes there is a but........

"Unfortunately, Gmail does not support Paymail, so we cannot use Gmail Paymails. But you can buy a domain, create a Paymail and start using it. Later, if you want to use the same Paymail as your email address, you can buy a GSuite or Office 365 package."

Unfortunately you have to pay for the service.

So, If I send some money to someones email address will he be able to set up moneybutton and receive that money?

"Currently, the Paymail account needs to exist when your wallet makes the payment. Otherwise, your wallet will return an error. The way to send money to an email address today is to create a wallet and then register a Paymail that matches your email address using a custom domain.

The idea of sending a payment to someone that does not have a Paymail account but has an email address is quite interesting. Also free email accounts are key, as you say. We will be trying to come up with innovative ways to address these issues in the medium term."

What about a smart contract? I link my friends email to a moneybutton account. This allows me to send to his email. He then has to create his own moneybutton account and automatically receive the payment.

And their reply is most interesting

"I just had an idea similar to what you are describing. We need to implement a couple of features to make it possible but it think it is doable."

DOABLE!!!

Yes this means that you can onboard all your friends by sending them money! How many people can refuse that. And if you make this viral with a referral incentive --- Kaboom! Moon Moon Moon.

A word of thanks to Pol Moreno Yeste @ mypaymail for his help.

BTC is in trouble. Chain Death Spiral Looms. BSV Wins!

BTC hashrate dropped from 136 THs to 95 THs

Block difficulty just adjusted (26/3/2020) at block 622944

Latest block mined is 622986

Next difficulty adjustment is at 624960

Average block time for the last 2016 blocks was 11 minutes 54 secs

Current time to mine a block have reached 20 minutes. This loss of hashrate is serious and could result in the chain grinding to a halt.

What cause the loss of hashrate?

Economics! For some miners it has become unprofitable to mine and they are switching off their machines. All machines of the S9 generation will be unprofitable. The current economic climate and lock downs all over the world must also be a factor. I suppose it would be hard to convince the police that you have to go to work because bitcoin mining is an essential service.

Why is the price still holding?

There was a huge price collapse from $8000 to $5000 on 13 March and since then it has recovered to just over $6000. However it has been a phenomenon of selling the top. Whales are exiting!!

BCH and BSV

Most institutional investors would move out of crypto entirely until the scene settles. BCH and BSV do not suffer from hashrate gyrations because blocks adjust dynamically. However both will be undergoing halving in the next 14 days. The block subsidy will halve from 12.5 to 6.25. This is a 50% reduction in revenue if the price stays the same.

What will become obvious is that on BSV the income from transaction fees is increasing even reaching 50 coins yesterday. After halving only 900 coins will be mined per day. If this trend continues miners will start mining BSV as it will be much more profitable than mining BCH after the halving.

BTC is in trouble. It may finally succumb to the dreaded Chain Death Spiral.

Bitcoin SV Next Bull Run

When will Bitcoin SV next bull run take place?

Guess we are all still buzzing over the last BSV price run up! When the dust finally settled BSV is up 300% and holding. So why did the last price hop happened? The main excuse was that CSW got the keys to his bitcoins! I commented then that it is nonsense as it was only a rumour and even if true the impact will be negligible. If the fear was that he would dump BTC to push up BSV then BTC should have experience a significant drop in price.

Those who are into BSV know that it is the original and real Bitcoin and are convince that it will be the only blockchain on which all blockchain apps will be built. The run up in price is only the first phase of existing whales and hedge funds building a position and new money coming into BSV.

Had it just been a CSW rumour then  BSV's price would have drop lower than from where it started - about $90. Instead it has settled around $300. The likely scenario is that this is the new floor from which the next price push will take place possibly to settle again between $600 and $900.

Timing a bull run is not a science. We can be sure that BSV will make its' biggest price break when hedge funds are convinced that BSV is the real Bitcoin. This will happen when all the arguments against BSV crumbles one by one and we reach tipping point in public perception first within the crypto community then in the wider public.

With that in mind the start of the next run should happen soon after the Genesis upgrade faultlessly. With that we should see all the apps timing for this event launch on the BSV blockchain. This burst in activity especially in monetized social media apps will pull many within the crypto community towards BSV.

How will it play out?

We should first see a sell-offs in alt as the smart developers and investors realise that their projects will work better on BSV. As before the move will be gradual but we will see it as a match between BCH and BSV.

It is quite surprising that BCH has maintained even the valuation it has now, with such low number of transactions on its' blockchain. Perhaps BCH supporters believe that it is digital silver to BTC'd digital gold. The truth is that with micro-transactions a reality, there is no need for digital silver, bronze or gold for that matter.

So the next phase will be a seesawing battle between BSV and BCH with the BSV whales taking every opportunity to build on their portfolio as the price moves in their favour. I suspect that BCH supporters will fight hard to prop up the value to stay ahead of BSV. If true this behaviour can be taken advantage off.

This phase will complete when BSV move to number 4 on coinmarket ranking indisputably, which will then trigger the next phase which is the race to NO 1.

WOW The Skip Happened ! Now For The Flip

When I wrote this article yesterday ( The Coming BSV Skip and Flip ) BSV was sitting at $170. Woke up this morning and it is $336 and has already surpass BCH at $331. No, I do not have a crystal ball or any inside information. I just noticed the volatility of BCH hashrate and suspected that something must be up with the Unknown Miners.

If BCH supporters are really desperately trying to keep their hashrate up by renting mining rigs then the game is really up. It is only a matter of time, as this will be a futile exercise. They will not have enough money to keep up with the rising price of BSV. It is a vicious feedback loop. Now it has happened. There will of course be resistance with market support but the outcome is inevitable. The fundamental value proposition for BCH is flawed.

For my observance this was my reward.

You've been permanently banned from participating in r/Bitcoincash

subreddit message via /r/Bitcoincash[M] sent 9 hours ago

You have been permanently banned from participating in r/Bitcoincash. You can still view and subscribe to r/Bitcoincash, but you won't be able to post or comment.

Note from the moderators:

Trolling

If you have a question regarding your ban, you can contact the moderator team for r/Bitcoincash by replying to this message.

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This is the first time that I have ever been banned and I have not posted there in 2 years. Guess the truth must hurt. Can't be that bad really because BCH price is actually up by about $70 since my post.

So the The Skip is over. Now the mainstream crypto presses will be pushing hard on the Tulip Trust narrative. Come on be serious. Anybody with common sense can see that it is all about the technology. Why is it that hard to fathom?

Unconfirmed if and buts about the tulip trust even if true, cannot account for the huge run up in price. It means that there is real demand especially when you realise that BSV price have been going up steadily since mid December and in reality since the delisting. 

Will The Flip happen now? Of course. More people are starting to believe or hedging their bets just in case.

Pump and Dump

Will there be a huge dump coming up? Unlikely. Those holding BSV are believers. Being a very divisive 3 way tug of war between the 3 coins those who wants to dump have done so already. The BSV community is even smaller than BCH, and those who are invested for the long term will hold on to their coins, which creates scarcity and more upward price pressure.

There will of course be attempts to push the price lower by traders but the variation will be no more than 30% at most and will be good opportunity to buy the dips. 

Watch the hashrate

I have explained what I believe will be the mechanics of The Flip so I will not repeat it here. As hashrate moves over to BSV, BTC's blocktime will rise and the mempool will bloat as well. This will be the start of the dreaded Chain Death Spiral for BTC. 

The average time between blocks for BTC is rising fast and is already at 17 minutes almost taking twice as long for blocks to confirm. 

Now that everybody have seen what happened BTC supporters will surely put up a valiant effort to prevent the Flipping. There will be lies, misinformation, market support, etc and again the outcome is inevitable. The value proposition that BTC is digital gold is also flawed. The great hope for BTC in the lightning network is also in trouble with security ans scalability issues.

As more people who have substantial financial stake in BTC realise, or start to feel uncomfortable about this, they will start to hedge by at least equalising the number of each coin held. This will of course drive up the price of already tightly held BSV. In a rising market miners will also withhold coins, selling only if they have to further restricting supply. Those selling in the hope of buying back on the dip if are unable to do so will quickly re-buyback at a higher price which will again add to upward price pressure.

Why should BSV succeed.

It has a useful value proposition anchored on a stable protocol with massive scaling.

Other ancillary reasons

1) The Bitcoin founder is behind the chain and supports the development of the chain. I have believed that Craig was Satoshi when he first turned up at this discussion back in June 2017. As more people accept this fact the negative connotation of Craig's effect on BSV price in the past will reverse. I also wrote another piece on why it matters.

2) The developer tools available to support building on BSV. The emphasis is on building useful apps, not on currency and price. The only way to get mass adoption is to get the masses using Bitcoin without them knowing that they are. 

3) The nChain team and Bitcoin Association are always announcing new apps, tools and developments. There is a sense of growth and vitality.

4) The BSV development team always deliver on their promises usually ahead of deadline scheduled.

5) The community is alot more friendly.

That said, all that is left to do is to sit back and watch events roll out as predicted. It is a great time to be alive and watch this drama play out.

The Coming BSV Skip and Flip

For the moment all eyes are on the huge price increase of BSV from around 98 USD to 170 USD over the last week. An increase of over 70% and would most probably exceed $200 soon. So what is happening?

For those who believe in the underlying technology of BSV the reason is clear and inevitable. BSV is the original protocol as described in the Bitcoin whitepaper and despite the timeline BTC and BCH are the forks off the true protocol. A "Back To The Future" scenario!

The main theme of this post is a prediction that BSV will soon surpass the price of BCH (The Skip) and thereafter go on to surpass the price of BTC ( The Flip ). Contrary to our intuitive nature of believing in the slow rate of change in the crypto sphere, these events will happen quite quickly, because theses events are very much determined by the mining hashrate.

For most of 2019 the hashrate for BCH was about 2% and BSV around 1% of the total hashrate. This week the hashrate in both these coins have doubled to 4% and 2% respectively. This means that miners are finding it more profitable to mine these two coins or the supporters of these coins are renting hashes to support their chain.

Notice the amount of "unknown" miners on the BCH and BSV blockchain and none on BTC. The hashrate on BCH have been fluctuating between 1.5 to 4.3% recently. For BCH, it is dangerous for its' hashrate to fall below that of BSV as it would very quickly be reflected in the price of these two coins.

Unknown Miners

Unknown miners have always been a part of Bitcoin mining, but the significant part that it is now playing on BCH and BSV is unprecedented. Seeing that is is more than 3%, the increase must be a switch from BTC mining either as a result of mining rentals or BTC miners dedicating some of their hashrates towards BCH and BSV without reveling themselves as doing so.

The increase in blocktime on BTC is starting to show. Keep an eye on this developing situation.

There is still much debate going on about which is the true Bitcoin and which will survive. Miners are business people and they will only be motivated by profit. It does not matter to them which coin wins as they will always mine the most profitable coin.

Prior to November 2018 the price of BCH which included BSV fluctuated a great deal but after that date BCH price have mainly trended downwards.

BSV price on the other hand trended downwards because it was delisted on many leading exchanges but has since trended upwards against BTC as oppose to BCH. The price drop as a result of delisting must be looked upon as a manipulated event and accounted for when studying the chart above.

Against BCH the price of BSV is also clearly trending upwards.

All these events must be looked at as part of the continuing struggle between BTC, BCH and BSV as to which is the real Bitcoin. When 3 coins are competing on the same mining algorithm only one will win. This is a winner takes all scenario.

The Skip
It is dangerous for BCH if its' hashrate falls below that of BSV as this will soon be reflected in the price. Because the price of BSV have been on the uptrend we can expect that some miners are dedicating a little of their hashrate to mining BSV as a defensive move. These will mainly be the source of the Unknown miners we see on the BSV blockchain.

The dilemma for BCH supporters is that if they do not do something about the mining hashrate their coin will be in danger. As price is not a real factor in the volume of Unknown miners on the BCH blockchain we can only surmise that it is the result of hashrate rentals by BCH supporters.

This situation is unsustainable as the more BSV price increase against the more hash rate they must rent from the available rental pool and also carry the losses on the BCH mined as BCH price trends against that of BSV.

This will all come to a head when BSV price exceeds that of BCH. This is the Skip event, after which the price of BCH will move down sharply. BCH goal of becoming digital cash will be over. It is not possible to be used as a digital currency if your market cap is less than 2 Billion USD.

The Flip
During the BTC and BCH war, BCH overtaking and replacing BTC was known in the crypto community as the flippening. This did not happen and BTC successfully retain the overwhelming majority of the Bitcoin hashrate.

BCH survived the Chain Death Spiral because it had the Emergency Difficulty Adjustment programmed in. It was able to retain a percentage of mining hashrate commensurate with its' price for profitable mining. This also applied to BSV after it forked from BCH.

We have already seen today at least 3% of hashrate moving away from BTC. As the battle between BSV and BCH intensify we will see more hashrate moving away.  The BTC blockchain is acutely vulnerable to loss in hashrate and the Chain Death Spiral. We may start seeing a slowdown in BTC blocktime in the next few days.

The halvening of the BTC, BCH and BSV will have a large impact on the price and hashrate distribution between these coins. If prices do not double to maintain profitability, it must be met with increasing value collected through transaction fees. Only BSV have the capacity to gain more from transaction fees per block than block subsidy.

Note the steady increasing trend in transaction fees over block reward for BSV.

Soon after The Slip, our attention will be turn to The Flippening round two BSV against BTC. This time there will be a real difference in ideology between the two chains.

A coin can only be relevant if it is useful. It will not be useful to the masses unless it can scale. Here BSV clearly trumps BTC as it can already achieve thousands of transaction comfortably while BTC is still stuck at a maximum of 7 transactions a second. Large blocks means lower cost per transaction leading to new applications built around micro transactions. Usefulness brings mass adoption. BTC is clearly not geared towards mass adoption but towards being used by a minority as digital gold. This will not succeed as it requires Governments to adopt BTC in their currency reserve in order to push the price of BTC towards a million dollars a coin perhaps. This is unlikely because participants in the world monetary system will not want to see huge chuck of wealth in BTC they do not control.

BSV on the other hand will achieve this by default. In striving for scaling and mass adoption and it will become embedded into all our lives at a global level. National currencies will be tokenised on the BSV blockchain and this will be the "Killer App" that will cement BSV as the real Bitcoin.

With scaling comes mass adoption leading to The Flippening.

Last Note For The Skeptics.
If you are still skeptical about the above then this chart may change your thinking. Using BCH as a base every crypto coin including BTC is negative except for BSV.

The Flippening

https://bitcoinandtheblockchain.blogspot.com/2017/11/the-flippening-btc-to-bch-wealth.html

https://bitcoinandtheblockchain.blogspot.com/2017/11/the-flippening-btc-to-bch-last-mile.html

https://bitcoinandtheblockchain.blogspot.com/2017/11/the-flippening-120-billion-reasons-why.html

Universal Basic Income - New Zealand Leads The World

What is Universal Basic Income (UBI)?

Universal Basic Income is the concept that every individual is entitled to and given a minimum income just for being alive or a member of a community. Such a guaranteed income gives every individual a feeling of self worth, gives them more life style choices and makes them less exploitable.

Is UBI neccessary?

Despite our perception that we live in a world of scarcity, in actuality we live in a world of abundance. Advances in knowledge and technology have brought us to the point where we can feed clothe and house every living individual on earth. Scarcity is intentionally introduced to benefit various power sectors.

We are now entering an age where all the dangerous, repetitive, cognitive and mundane jobs can be done better by Artificial Intelligence and robots.

Rather than limiting the number of working hours per person to share the available "productive work hours", we should broadly redefine what constitute useful work.

We can view UBI as rewarding "community centric work" and wages as rewarding "economic centric work".

Is this not communism or socialism?

This is capitalism starting with everyone having a minimum income rather than from zero. When everyone has money to spend capitalism thrives, and the worst aspect of capitalism, wealth inequality, is mitigated.

How can UBI be paid for ?

Our monetary system will be digital soon. With digital money, taxation (Value added tax) can be coded into every transaction. Money can also be easily coded for UBI distribution. There will be huge savings in the verification, collection and distribution of tax revenues, and elimination of corruption and unfairness within such a system.

As AI and robots displaces the dirty and mindless portions of "work" in our economy, UBI gives us the ability to pursue "work" that we value, treasure and appreciate individually and by our community.

Huge monopolies will form, but efficient monopolies will mean more and greater value creation for taxation, and the social impact of monopolies can be modulated with the right incentives.

One of the most interesting aspect of blockchain technology is token issuance for securing the blockchain. People and businesses compete to win these tokens and use them to transact even though they were never issued as legal tender by any government. This brings up the question as what constitutes money, but that is for another discussion.

For our discussion here, the fact that a token independent of any government can be accepted as money means that we have a "source of new money" that can be use for the purpose of UBI. Such a source will transcend government and borders. All it will require is a uniquely identifiable token wallet and general everyday use of these tokens worldwide.

Government support for UBI.

Some countries have experimented with various form of UBI however no country have instituted it as a principal pillar.

The state of Alaska however have instituted an annual dividend for every citizen finance from oil revenues.

New Zealand has a universal pension* of about $1000 USD a month for every citizen above the age of 65. This amount is not means tested and is opt in. We can argue that this is UBI for every citizen aged 65 and above financed from taxation. New Zealand has a 15% Value Added Tax on all goods and services with only financial transactions and exports zero rated.

Recently US presidential candidate Andrew Yang** have made UBI a central platform of his campaign. His proposal is to make $1000 USD a month payable to every citizen above the age of 18 finance in part from a value added tax on all goods and services at a rate of 10%. Except for the age of eligibility the system is very similar to the New Zealand's system.

Economic impact of UBI.

Most farm based small towns are capable of having a sustainable economy. Factory towns however are decimated when the factory closes and the monetary lifeblood of the community is shut off. This is now happening on a grand scale worldwide as the fourth industrial revolution*** takes hold. A UBI for every citizen will mean that financial lifeblood of communities become independent from the location of revenue generators. Mom and Pop businesses will generate jobs, employment and thrive. This will be a game and life changing phenomenon.



*    https://sorted.org.nz/guides/retirement/about-nz-super/
**   https://www.yang2020.com/
*** https://www.britannica.com/topic/The-Fourth-Industrial-Revolution-2119734