> They are also getting mining rewards. If a blockchain has mining rewards, maybe in the form of Bitcoin Cash, then that will dilute the entire pool of Bitcoin Cash.
How is this any different than the Fed or the fractional reserve banking system creating new US dollars?
> nothing about the technology itself makes the concept of transferring money cheaper.
Nothing except for the thing that matters: If you have something fungible instead of something with high switching costs, it makes fees go down.
> if it became a threat to payment processors, my theory is that they could lower their costs more than blockchains potentially can.
And that's why blockchains are useful! To exert the pressure needed to make that happen.
It doesn't matter if the centralized system can have lower costs unless it actually does, and for that you need the competitor to exist as a viable threat.
How is this any different than the Fed or the fractional reserve banking system creating new US dollars?
> nothing about the technology itself makes the concept of transferring money cheaper.
Nothing except for the thing that matters: If you have something fungible instead of something with high switching costs, it makes fees go down.
> if it became a threat to payment processors, my theory is that they could lower their costs more than blockchains potentially can.
And that's why blockchains are useful! To exert the pressure needed to make that happen.
It doesn't matter if the centralized system can have lower costs unless it actually does, and for that you need the competitor to exist as a viable threat.