The Strange Case of Nakamoto’s Bitcoin

> Have you ever wondered why Bitcoin makes such a poor payment network? Why Nakamoto ignored or sidestepped questions on the transactional performance of Bitcoin and instead would focus on bandwidth? What about the transactional profile of Bitcoin being far closer to something used to register real estate transactions, rather than a global payment network? The answer is clear, transactions in Bitcoin are not meant to facilitate payments in the typical sense, they are useful insofar as they allow Miners and speculators to realize returns on their investments.

> A speculative and deflationary ‘asset’ makes for a poor currency, people are disincentivized from using it today, as it might be worth considerably more tomorrow. This very criticism was leveled against Bitcoin on the BitcoinTalk forums in February 2010 [1], as the design of coin rewards combined with the halving schedule rendered the protocol useless as a currency. Few would spend something whose value appreciated 19% every year. Nakamoto participated in this very forum thread and was well aware of the criticism, but shrewdly chose not to address the issue directly, ever careful to misdirect, lest too much attention be paid to Bitcoin’s fatal flaws.

[1] https://bitcointalk.org/index.php?topic=57.0