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Re: WCIG meeting on Verifiable Credentials, Decentralized Identifiers, and DID Ledgers

From: Manu Sporny <msporny@digitalbazaar.com>
Date: Fri, 23 Mar 2018 20:16:11 -0400
To: Melvin Carvalho <melvincarvalho@gmail.com>
Cc: TAG List <www-tag@w3.org>
Message-ID: <ff2d0fde-1457-2860-5fe4-f5106a02094a@digitalbazaar.com>
On 03/22/2018 06:41 AM, Melvin Carvalho wrote:
> <https://docs.google.com/presentation/d/1qOjzppFLXtL7Is-MQ94BAyJhsZ3Otc2qKVz1hC0c10M/edit#slide=id.g354c1cd95b_0_29>
>
>
> 
In slide 25 it says DID creation on bitcoin costs $15
> 
> https://bitinfocharts.com/bitcoin/
> 
> According to the site above the median transaction fee on the
> bitcoin network is $0.20 -- is the information out of date, relating
> to previous maximums, or involving multiple transactions?

The transaction fee doesn't capture the total cost of the transaction.
In fact, it's a rounding error on the total cost of performing a
transaction on the network.

Transaction cost varies wildly between blockchains and market swings,
but here's one way to do the calculation:

The price per Bitcoin as I write this email is $8,731.60.

The block reward for a Bitcoin is 12.5 BTC as of this email. So, the
total reward for generating a block is roughly $109,137.

The total number of transactions per block has peaked around 1,537 in
the last month or so.

So 109137/1537 = 71

The cost per transaction is actually closer to $71 this month (plus
$0.20)... but that number thrashes wildly depending on market
speculation and a variety of other factors.

... and this is the reason the Veres One Decentralized Identifier
Blockchain didn't do an Initial Coin Offering and doesn't have a token.
Doing either of those things leads to terrible price volatility because
you get both institutional and inexperienced investors playing the pump
and dump game.

That number also doesn't factor in how Bitcoin mining operations and
electric utilities externalize even more mining costs via the use of
natural resources (water, coal, etc.) whose costs to the environment are
not fully accounted for due to political lobbying and other practices
that hide the true cost of mining Bitcoin.

Hope that helps explain where that $25 number came from.

-- manu

-- 
Manu Sporny (skype: msporny, twitter: manusporny, G+: +Manu Sporny)
Founder/CEO - Digital Bazaar, Inc.
blog: Rebalancing How the Web is Built
http://manu.sporny.org/2016/rebalancing/
Received on Saturday, 24 March 2018 00:16:45 UTC

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