Well, I will just state my opinion as there is no 1 truth to this question.
Just releasing my frustration
Honestly, first, it makes me so sad everybody knows only about bitcoin. BTC is really not that useful but I am sure that will change when the hype drops and people will study the problem/industry more. I am not referring to you specifically now, you have a very valid question but to all the media. I just wanted to point that out, DO YOUR RESEARCH everybody who will ever read this comment :)
What preserves BTC value
BTC started as a payment system but due to the complexity of PoW (proof of work), it became a "store of value", as it's too expensive to move it haha. Ah, I am so biased lol. But is true, a transaction (change in a variable state) costs several $. So you can't really send 10$ to a friend because it will cost you 20$, depending on the network stress.
Will it drop to 0? IDK, maybe it will go to "the moon", I only pay attention to protocols that produce direct value, HAVE A DAY-TO-DAY UTILITY such as Ethereum or XRP.
Why PoW
I am not sure if they see it coming or not, I think developers being developers, may seen it coming, but was too interesting to develop it anyway. Or, the same may have happened like with energy sources. As humans, we started with non-renewable sources because we comprehended them first, now we are transitioning to renewable sources like solar energy as we matured. You must start somewhere I guess.
In the recent months, there is a lot of migration towards PoA (proof of authority) or for example PoS (proof of stake) consensus. In my company, we are using PoA since beginning of 2017 and the difference in speed is noticeable but you must have proper tools in place to don't betray the original, main purpose of blockchain, decentralization.
Sure, long story short, you setup a bunch of trusted Validator Nodes (authorities) with the sole purpose of receive incoming transactions from computers of the network and put them to a block. Which is different from PoW, because not everybody can become a Validator.
Example, Ripple UNL. There are validator nodes from community, from banks, from company itself, from exchanges etc. And they actually do not have any incentive ("block reward") to be a validator. They do it just to contribute to the P2P world. Which I find very pure and how it should be. You could also make PoA Validator nodes to receive rewards to cover their energy costs, also fine IMO as powerful servers are expensive.
Ethereum is also developing several PoA test networks. Such as Rinkeby which one I explain in my course and teach students how can they connect to this test network.
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Well, I will just state my opinion as there is no 1 truth to this question.
Just releasing my frustration
Honestly, first, it makes me so sad everybody knows only about bitcoin. BTC is really not that useful but I am sure that will change when the hype drops and people will study the problem/industry more. I am not referring to you specifically now, you have a very valid question but to all the media. I just wanted to point that out, DO YOUR RESEARCH everybody who will ever read this comment :)
What preserves BTC value
BTC started as a payment system but due to the complexity of PoW (proof of work), it became a "store of value", as it's too expensive to move it haha. Ah, I am so biased lol. But is true, a transaction (change in a variable state) costs several $. So you can't really send 10$ to a friend because it will cost you 20$, depending on the network stress.
Will it drop to 0? IDK, maybe it will go to "the moon", I only pay attention to protocols that produce direct value, HAVE A DAY-TO-DAY UTILITY such as Ethereum or XRP.
Why PoW
I am not sure if they see it coming or not, I think developers being developers, may seen it coming, but was too interesting to develop it anyway. Or, the same may have happened like with energy sources. As humans, we started with non-renewable sources because we comprehended them first, now we are transitioning to renewable sources like solar energy as we matured. You must start somewhere I guess.
In the recent months, there is a lot of migration towards PoA (proof of authority) or for example PoS (proof of stake) consensus. In my company, we are using PoA since beginning of 2017 and the difference in speed is noticeable but you must have proper tools in place to don't betray the original, main purpose of blockchain, decentralization.
Can you explain proof of authority?
Sure, long story short, you setup a bunch of trusted Validator Nodes (authorities) with the sole purpose of receive incoming transactions from computers of the network and put them to a block. Which is different from PoW, because not everybody can become a Validator.
Example, Ripple UNL. There are validator nodes from community, from banks, from company itself, from exchanges etc. And they actually do not have any incentive ("block reward") to be a validator. They do it just to contribute to the P2P world. Which I find very pure and how it should be. You could also make PoA Validator nodes to receive rewards to cover their energy costs, also fine IMO as powerful servers are expensive.
Ethereum is also developing several PoA test networks. Such as Rinkeby which one I explain in my course and teach students how can they connect to this test network.