Bitcoin certainly seems to be winning the currency battle until now. Its nearest competitor appears to be Litecoin, which offers only 2% of the value per coin and is rarely if ever mentioned by anyone although I see articles about Bitcoin daily. Another big danger is that the whole area of virtual currencies could be declared illegal and Mt. Gox shut down. It is illegal to create alternative currencies to the dollar in the United States, after all. There are other minor dangers. For example, it occurred to me that a botnet of sufficient size might be enough to overwhelm to whole computational capacity of the entire Bitcoin network, and thus, effectively destroy it. The same forces that work to ensure the integrity of the network now might work against it then, if the majority of nodes are bots and dishonest manipulators. Currently the botnets are cooperating to mine bitcoins. In the future, that may change...
I think your argument is rather sound. At least it is more sound than the usual pro-Bitcoin claim that "there will only ever be 21,000,000 bitcoins, therefore deflation forever." However, there is a counterargument that I thought of. There are a couple of things that could cause bitcoin to retain its value in the long term: fame, and the network effect. Fame, because Bitcoin is the first of its kind and the most frequently discussed. It is like the Kleenex or Xerox of virtual currencies, the one that gives its name to all the rest, and that gives it enduring value. The second is the network effect. The more people use it, the more people want to use it. Thus, even with low barriers to entry, Bitcoin could eventually win a near-monopoly in the virtual currency market.
You're probably right. People who pass the test have nothing to complain about and don't cause problems. The teacher is unlikely to care if they actually read the material in that case. On the other hand, imagine the student who didn't pass. They can tell him, "You didn't pass because you didn't read the material, so you have nothing to complain about." His complaints will get nowhere. If nothing else, it makes their job defending themselves as educators easier. The one who never cracks the book then blames the teacher when he fails will no longer cause problems for them.
I have been following these Bitcoin stories with some interest and I have a technical question maybe Slashdot can answer. It seems to me that Bitcoin has problems with scalability.
My impression is that to perform a Bitcoin transaction you have to download the entire history of Bitcoin transactions before you can get started and the entire network has to confirm your transaction and it's authenticity to prevent double-spending of coins. So far, so good. The problem is that this is an all-to-all network in terms of storage and processing requirements and its needs seem to scale exponentially. Last year, I hear there was 2 GB of storage required and this year 6 GB.
My question is: doesn't that imply that Bitcoin won't scale and will eventually fizzle out due to impractical storage and processing requirements? Who will want to download 100 GB or 1 TB of history of transactions of the entire world just to buy a sandwich?
And doesn't that imply that there is room for Bitcoin 2.0, a new virtual currency with better scalability and possibly other improved characteristics? Compare Bitcoin with the Internet itself. The Internet is far more scalable because it is broken down into subnets and features more point-to-point communication and no need of transaction history which makes it far more scalable.
Hypothetically, couldn't another virtual currency like Bitcoin be devised, that separates its users into subcommunities based on their frequency of transaction or physical location, and thus feature more efficient local transactions, which most transactions are, while allowing the occasional transaction to be routed between subcommunities? It could also feature a shorter history that only remembers a certain period worth of transactions, like one month, along with everyone's balance, thus avoiding the need of storing the entire history. Further, it could develop a reputation system that enhances the ability of the system to reject bogus transaction.
tl, dr: How is Bitcoin supposed to scale to more usage given its exponentially increasing storage requirements, and what can we replace it with that is more scalable, being better structured, with shorter history, or more efficiently rejecting bogus transactions?