I thought we were talking about the latter—people would convert dollars into Newcoin via an intermediary Bitcoin stage (perhaps because Newcoins are banned or something).
If we were talking about ‘converting’, such as by some of the suggested verifiable-destruction strategies… I’m not sure. Presumably each Bitcoin would always sell for at least as many dollars as its equivalent in Newcoin would fetch modulo the transaction fees and effort (since otherwise people who want Newcoins would buy up Bitcoins and convert them immediately), but if Newcoins were so much better why would any Bitcoin holder at all not immediately convert all their Bitcoins to Newcoin? Reminds me of the flows between coin and bullion in metallic regimes.
I now see that when I wrote the original post, I probably should not have used the term “trade” as a synonym for “convert”. Someone who did not read my post closely might have thought I was enthusing about incremental improvements that let you reassign ownership like a traditional marketplace, only more efficiently, with automatic bid processing or something. That might be nifty, but it is not the earth-shattering point that makes me want to buy lots of bitcoins. What makes me want to buy more bitcoins is that reassignment of ownership is not the easiest way to do it. Instead it’s easier to make a system that destroys so many bitcoins and creates so many newcoins. It is also something that the current owners of bitcoin have significant financial incentive to make sure happens. Since it’s easier and massively incentivised, I think it carries the bulk of the probability mass.
I thought we were talking about the latter—people would convert dollars into Newcoin via an intermediary Bitcoin stage (perhaps because Newcoins are banned or something).
If we were talking about ‘converting’, such as by some of the suggested verifiable-destruction strategies… I’m not sure. Presumably each Bitcoin would always sell for at least as many dollars as its equivalent in Newcoin would fetch modulo the transaction fees and effort (since otherwise people who want Newcoins would buy up Bitcoins and convert them immediately), but if Newcoins were so much better why would any Bitcoin holder at all not immediately convert all their Bitcoins to Newcoin? Reminds me of the flows between coin and bullion in metallic regimes.
I now see that when I wrote the original post, I probably should not have used the term “trade” as a synonym for “convert”. Someone who did not read my post closely might have thought I was enthusing about incremental improvements that let you reassign ownership like a traditional marketplace, only more efficiently, with automatic bid processing or something. That might be nifty, but it is not the earth-shattering point that makes me want to buy lots of bitcoins. What makes me want to buy more bitcoins is that reassignment of ownership is not the easiest way to do it. Instead it’s easier to make a system that destroys so many bitcoins and creates so many newcoins. It is also something that the current owners of bitcoin have significant financial incentive to make sure happens. Since it’s easier and massively incentivised, I think it carries the bulk of the probability mass.