Bitcoin incentivizes honesty
I personally think, in a world of dishonesty, and low trust, bitcoin prioritizes fairness.
Lets see, bitcoin is designed for its users ( which can be, miners, developers, government, investors, attackers, etc) to interact within themselves under a set of rules.
If any party behaves dishonestly, it will be disadvantages/ non-incentivizing to themselves.
Lets take examples:
Miners
– If they trust -> they will earn block rewards and transaction fees.
– If they attack (51% attack, double spending) -> they risk destroying confidence in btc -> btc's value goes down -> their own rewards underperform.
Investors
– If they trust -> they keep using the btc -> btc value appreciates and also stabilizes -> can be beneficial for payments (as more people continue accepting payments in btc) and also for hedge against inflation.
– If they distrust -> they will exit/sell -> price collapses, and also btc continue to be volatile (bad for payments).
Attackers
– to just hack/ attack , they need huge resources.
– if they successfully do a 51% attack, btc's credibility and prices will crash, making their reward way low.
– incentivizes to be a user/miner then to be an attacker.
Government
– Outright banning it will only result in underground activity, last mover disadvantage, loosing on maybe investment, innovation and strategic reserves.
– regulating can yield more taxes to the government.
In short, Bitcoin’s game theory is about making it too costly to cheat/ignore and more profitable to play fair.
My take is maybe not so polished. Would love to hear y'all thoughts on this.
submitted by /u/drunkkaf
[link] [comments]