There are many ways where Hive can succeed. This is one of the most dynamic blockchain with capacity for growth coming from many different places. By combining social media with finance, along with a robust layer 2, smart contract platform, we could see an ecosystem that is one of the most valuable in this industry.
Sometimes, we can get lost with all the options that are before us. In this article, we are going to revert back to the most basic essence of blockchain to see where Hive stands. If we bore down to core, it quickly becomes evident what we are dealing with.
Years ago, in one of the James Bond films, Carly Simon had a song where called "Nobody Does It Better". When it comes to this facet of Hive, it is applicable.
So let us investigate what Hive has to offer from this perspective and the impact it could have on the value of the network.
Source
Visa Payments
As we can see from the above graphic, the numbers are absolutely huge. When it comes to payments, at least on North America, Visa simply dominates.
The company does about 150 million transactions per day. According to the most recent numbers, as of March 2022, the company had done 255.4 billion transactions totaling more than $14 trillion. Source
Their operating income for the trailing 12 months, as of Sept 30 was $19 billion on $29 billion in revenue. The present market capitalization of the corporation is $490 billion.
Indeed, some rather large numbers.
That said, what is Visa? We think of them as a financial services company but that is not the case. They are primarily a computer networking firm. It establish a massive communications network that processes and transfers data not only in large volumes but at rapid speeds.
Of course when we look at the complexity of how things operate, we see why this is.
Here is the transaction authorization process:
That is just to run the transaction through. Then we have to account for the settlement.
Fortunately all of this happens in the background because there are a lot of moving pieces. Visa has spend a fortune building out their network to ensure it is able to facilitate all these processes.
Ultimately, the company is doing nothing more than moving data around. There is no currency involved in this. It is nothing more than crediting and debiting ledgers. Under this scenario, it is all controlled by Visa. We are dealing with their network, servers, and account management. In short, it is their world.
And because of this, they are worth half a trillion dollars.
Blockchain
Blockchain solves this.
With the introduction of Bitcoin, we saw the establishment of distributed ledger technology that does the same thing companies like Visa do. At its core, a blockchain transmits data and updates the ledger. This is what block producers do. When it is tied to a cryptocurrency, we have a system that is transferring value.
Here is where we see the currency idea of cryptocurrency. The concept was to have the value, i.e. coins, in a wallet, and the network transfers what is desired to another wallet based upon the user's request. Through the different consensus mechanisms (PoW, PoS, DPoS), the double spend problem was eliminated.
Basically we are looking at a digital cash payment system. Obviously this differs from Visa in the fact there is no credit involved. For this reason, the process is akin to PayPal. Nevertheless, when looking at the money involved, we can see how Visa is the king.
Here is where Hive and Carly Simon enter.
This is a Tweet I sent out the other day:
Hive is a digital network of nodes operating all over the world. This system is open 24/7/365 with blocks being produced every 3 seconds.
The fact there is no company means the trust comes from the blockchain itself. Each minute of the day, 20 more blocks are produced. This is filled with transactions of all kinds. However, whenever anyone sends $HIVE or HBD to another wallet, it is recorded.
Here is the kicker.
Hive offers, at most, 3 second, transaction time. The average is about 1.6 seconds. Even more importantly, due to one block irreversibility, the total transaction is settled in a few milliseconds more. That means the entire process is done in under 2 seconds.
When it comes to the blockchain world, nothing can touch that. Bitcoin can have transactions hung up for hours before they ultimately fail. Litecoin can do the same thing. With Hive, we know very quickly if there is an issue.
Since the days of Satoshi Nakamoto, this was the focus: an electronic cash transfer system without the use of banks or other financial institutions.
Well, based upon upgrades to the network, at this point, when it comes to transfer of value, nobody does it better than Hive. It is the premier digital payment system out there.
Impact On The Value Of Hive
Everyone is looking for the moonshots.
For the past few weeks I have discussed transactions and the value of them. Obviously, this is often from the social media and gaming point of view since that is something that Hive offers also.
However, when it comes to finance, it is vital to think in these terms. A system's value grows a great deal when the transactions increase. Naturally, this is compounded by the total amount transferred.
So what could be the value of Hive simply as a payment system?
We are dealing with a lot of guess work here but if we can pull in 1% of Visa, that would give us a range to play one. One thing we much mention is that, when it comes total amount, the banking system sends far more than Visa, at a much higher cost.
Nevertheless, using 1.5 million payments per day, with a 1% market capitalization of Visa, that puts Hive close to $5 billion. That would not even break into the Top 20 of cryptocurrency even with the bear market. During the bull, that might not enter the Top 75.
Of course, we have to highlight the fact that payments on Hive have zero direct transaction fees. The only thing needed is to stake the main coin.
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Would it be possible to create a working hive credit card with your current system?
If we could get bitpay to accept it, that would do the trick without all the backend work.
Would be amazing and they should!
They fking accept Shiba and Apecoin wtf xD
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Most of the current cards out there like Crypto.Com use Visa for the transaction and an in-the-moment exchange of crypto->fiat for the transaction. So in the current thinking way cards are used, its not possible.
We need merchants to mass adopt alternative mechanisms to use crypto directly which is hard to do without mass adoption of crypto already happening.
Ah ye true.
Credit ? Why credit? Why ppl always want that f*ing credit ???
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Well, credit card means different things in different countries.
Americas credit card system is weird
He isnt in America.
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Ohh xD
I don't understand the commemt then
I'm waiting for this. I expect it to happen. It's just a matter of time.
It is not specifically about credit but that the card is a vehicle that helps in the transfer of current token amount/value.
Yes, doesn't even have to be an actually card
I think we should aim for Bitpay and the newegg store to accept hive in some way. This way we would have one store that accepts hive and ships worldwide anywhere. It would improve the Hive's name and get it mainstream.
Newegg would be great, as everyone who uses Hive needs hardware of some sort. Being able to purchase it without converting their rewards would be a great incentive for non tech / non crypto people.
!PIZZA
A great title for a fantastic read. Very informative.
We’d need a lot more HBD. But since achieving that would imply a huge increase in the price of $HIVE, none of here today would be likely to complain.
Someone made that same comment the other day about something else.
I have a feeling you are right, we are going to need a lot more HBD.
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This depends on mostly where it is accepted. Are the stores, markers, supermarkets, hypermarkets accept them? Technically the Hive Dollar (HBD) would be very easily usable almost anywhere. Nowadays Hive is not accepted nowhere in my country (in Hungary). The Bitcoin (BTC) is accepted in a few places, but that is risky to use to buy and sell everyday things because of its volatile price. The Hive Dollar (HBD) is not that volatile (usually it is around $1 USD). The merchants/sellers and buyers need a different approach/viewpoint for both of these cryptocurrencies.
Volatility is a drawback for using Bitcoin (and HIVE) as a medium of exchange.
Those coins can bounce around too much.
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Yes. In addition to other things, this is why Steam removed Bitcoin (BTC) as a payment method. It would be good, if they would accept stablecoins. Those could properly work.
I can't wait for the price of Hive to hit $1, I believe so much in this token.
Nice update, you are amazing!!
I have higher views.
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Sounds great!!!
What are your predictions?
!PIZZA
Goodbye Visa!
Probably it is too early to say that. Except if you can buy foods and drinks in the grocery stores with Hive.
I'm sure that's coming.
I would say that is a bit premature.
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My concern is that of scale. At the moment Hive works with the volume of transactions we have but I would be interested in a technical answer into how Hive can scale. We have all witnessed other cryptos getting flooded. That usually results in high transaction fees which turns people away. And although that may not be the case with Hive, if we need to stake a higher value to be able to transaction, that could push away users.
I don't think RC is tied to the value of hive in any way, I believe it can be easily adjusted by witnesses.
So if I happen to be correct, a higher Hive price should actually result to a lower RC required to transact because the incentives witnesses are getting could be a bank maker that simply enables them handle whatever volumes and keep the cost low.
I'm just making guesses anyways.
hmm, not sure. Most systems when they get flooded by transactions means that those who can afford win and those who can't lose out.
You have to stake Hive to be able to transact. To transact more you need to stake more to get more RC (or have it delegated to you). In the short term, witnesses get more money from, can buy bigger kit and systems to support the increase in transactions but eventually that has diminishing returns.
In my view, it is unproven but just my (guess) opinion. Hopefully things scale well.
I already understand this, what I meant was that let's say Hive goes to $100 a coin, witness making like 16 Hive a day from producing blocks are effectively making $1,600 a day, this huge profit from producing blocks may lead to a concensus to reduce the RC required to transact given that Hive is very expensive and they earn quite enough to handle the cost of increased volume.
The fees escalating is due, in part, to the system not being able to scale.
We had tests from Blocktrades incurring significantly higher amount of traffic even without expanding the block size.
Plus there is more work being done to optimize the chain. The goal is to get it to the point where it can be run on a PC.
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Thanks, I think optimisation is key and hopefully everything will scale and hold out nicely. We are just a long way of the volume of Visa but the future is going to be really interesting - exciting times!
The blockchain could really handle an influx of billions of transactions a day 😲?
Pumpamental analysis! This year will get too my mile stone of hive stake, because am having that butterfly which says hive will moon soon given its recent performance in the bear market
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Muchas gracias por la información, sin duda alguna Hive es la mejor sigamos invitando y que siga creciendo, muchas gracias.
I think it's possible but we need a lot more liquidity before that can even happen and that would also require the price of Hive to go up too so the print-limit goes up. At the same time, I am not sure because the middle man will give up easily. They will definitely try to sabotage the system and I think any system needs a way to be sustainable. So there might be some fees (although less or none is best for consumers).
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Yes blockchain is better than a bank (and anything is better than using a credit card). But how to convince the general public?
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And at least there is a way to use Hive even if you have no checking or savings accounts. You can't get a Visa or Mastercard without one or both of those and a J.O.B. On Hive you can earn the tokens and pay directly.
And no exorbitant gas fees.
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