# NOT POSTED

Bitcoin was designed to be a payment system run by miners for their own use.  Non-mining users were supposed to pay the miners for their service, at whatever price that the miners found adequate.

Several things did not happen at expected, unfortunately.  First, the price rose too much too fast.  As a consequence, mining became dominated by industrial enterprises that were interested in the money of the block rewards, rather than using the service themselves.  Then mining became centralized in half a dozen companies, instead of the thousands of independent miners-users that Satoshi had assumed.

Objectively, given the last point, one should consider bitcoin dead already.  It was created only because Satoshi believed that the world needed a decentralized payment system that did not depend on trusted intermediaries -- which is no longer the case.  Bitcoin is no longer a decentralized system, and there is no reason to expect that it will become one again.  

As a centralized payment system, bitcoin is absurdly inefficient and inconvenient.  It survives only because (1) it got many users who do not give a damn about centralization or efficiency, and use it because it bypasses government controls (so they think); and (2) because it is a great instrument for day trading; and (3) because there are still buyers willing to pay $430 for each coin that the miners mine, hoping to sell it someday for a higher price.

Another consequence of the absurd price level is that miners only really care about (3), because they could never get more than a few percent of their revenue from transaction fees.  However, mines must still serve (1), in order to sustain the investors' illusion that bitcoin will one day be very valuable because it will be a competitor to VISA and PayPal.  And some of the largest mining companies are also among the largest bitcoin exchanges, so they profit from (2) too.

Yet, none of these three "uses" of bitcoin justify its existence.  The world did not need another channel for illegal payments, another penny stock for day traders to gamble with, or another pyramid investment schema.  Satoshi would not have bothered to create bitcoin, if he expected it to have only those uses.  Also, he would not have bothered to design and buils another *centralized* payment  system to compete with VISA.

Apart from mining concetration, there were several other unforeseen and unwelcome developments.  

For instance, many bitcoin "believers", old and new, were unable to compete with the industrial miners, but still wished to retain the control that they had as miners.  Thus was born the concept of "full but non-mining" (FNM) relay node: a volunteer that intends to sit between the non-mining users and the miners, relaying transactions one way and mined blocks the other way, while checking both for validity against his copy of the blockchain and auxiliary databases.  

While FNM nodes may seem a good thing at first sight, they are in fact an Bitcoin was designed to be a payment system run by miners for their own use.  Non-mining users were supposed to pay the miners for their service, at whatever price that the miners found adequate.

Several things did not happen at expected, unfortunately.  First, the price rose too much too fast.  As a consequence, mining became dominated by industrial enterprises that were interested in the money of the block rewards, rather than using the service themselves.  Then mining became centralized in half a dozen companies, instead of the thousands of independent miners-users that Satoshi had assumed.

Objectively, given the last point, one should consider bitcoin dead already.  It was created only because Satoshi believed that the world needed a decentralized payment system that did not depend on trusted intermediaries -- which is no longer the case.  Bitcoin is no longer a decentralized system, and there is no reason to expect that it will become one again.  

As a centralized payment system, bitcoin is absurdly inefficient and inconvenient.  It survives only because (1) it got many users who do not give a damn about centralization or efficiency, and use it because it bypasses government controls (so they think); and (2) because it is a great instrument for day trading; and (3) because there are still buyers willing to pay $430 for each coin that the miners mine, hoping to sell it someday for a higher price.

Another consequence of the absurd price level is that miners only really care about (3), because they could never get more than a few percent of their revenue from transaction fees.  However, mines must still serve (1), in order to sustain the investors' illusion that bitcoin will one day be very valuable because it will be a competitor to VISA and PayPal.  And some of the largest mining companies are also among the largest bitcoin exchanges, so they profit from (2) too.

Yet, none of these three "uses" of bitcoin justify its existence.  The world did not need another channel for illegal payments, another penny stock for day traders to gamble with, or another pyramid investment schema.  Satoshi would not have bothered to create bitcoin, if he expected it to have only those uses.  Also, he would not have bothered to design and buils another *centralized* payment  system to compete with VISA.

Apart from mining concetration, there were several other unforeseen and unwelcome developments.  

For instance, many bitcoin "believers", old and new, were unable to compete with the industrial miners, but still wished to retain the control that they had as miners.  Thus was born the concept of "full but non-mining" (FNM) relay node: a volunteer that intends to sit between the non-mining users and the miners, relaying transactions one way and mined blocks the other way, while checking both for validity against his copy of the blockchain and auxiliary databases.  

While FNM nodes may seem a good thing at first sight, they are in fact an