14 ms·

No Bitcoin-based protocol can handle more than 20M users per month

276 points by runeks 9y ago

Kelab 9y ago
Even dash/litecoin? Maybe dpos will win e.g steemit kevin ross just joined
tudorconstantin 9y ago
Why can't people be paid directly on one of the layer 2 systems?
- Filligree 9y ago
  At that point, aren't you just reinventing fiat money?
  - drcode 9y ago
    No, a blockchain 2nd later system still gives strong security guarantees that are similar to the 1st later system.
    - cma 9y ago
      > still gives strong security guarantees that are similar to the 1st later system. Like Mt. Gox?
      - kristofferR 9y ago
        No, not like Mt. Gox.
      - vertex-four 9y ago
        The "second layer system" that people are actually talking about is Lightning Network, the basic idea of which has been around for a few years now. Basically, you open a "payment channel" of X bitcoins with someone else in the network, and you can trade up to X bitcoins with them almost-trustlessly - cheating is easily detectable within the protocol, and results in the party detecting the cheating settling the payment channel on the blockchain. Payment channels can be linked, so you can send money from A to B through payment channels A-X, X-Y, Y-B, without actually trusting any of those entities. So blockchain transactions only ever happen when someone wants to open a new payment channel (which is only relatively rarely), when someone they directly have a payment channel open with attempts to cheat, and in the rare occasions that someone wants to hold "actual" bitcoins rather than a cryptographic promise of bitcoins. There's no entity within this system which has central control over currency that goes through this system, and all cheating is detectable with rollbacks in place when it happens, so it's not like a bank, exchange, or even a traditional payment processing network at all. Note: I have my own qualms with cryptocurrencies and the human layer, but you've got to admit the technological backing is sound within reasonable parameters.
      - haakon 9y ago
        Mt. Gox was a centralised custodian. Layer 2 systems like Lightning Network are not, because they can't run away with your money. If they try to cheat, you can always withdraw your money.
        the_stc 9y ago
        But detecting cheating and withdrawing requires you to have client software online and monitoring. Which individuals can not do and thus will outsource it to their payment handling company which will probably be the same as the LN hub.
        haakon 9y ago
        It can be outsourced to trustless third party, who also has no control over your money and cannot cheat.
  - quickben 9y ago
    It depends on the purpose. For example: You can't hype fiat money anymore, too much liquidity.
  - keymone 9y ago
    Layer 2 is not money and so can’t be fiat. Lightning network is just a clever way to construct bitcoin transactions such that it is possible to send sub-transactions via different communication channel(not congesting bitcoin network) but preserving crypto currency guarantees.
    - knocte 9y ago
      > Layer 2 is not money Ehrm, what? So Layer1 is not money for you either? Explain... PS: I'm not agreeing with that "this is reinventing fiat money" comment.
      - keymone 9y ago
        layer 2 is the payment processing network, money being transferred remains bitcoin.
- runeks 9y ago
  (Author here) They can, but how large a part of the world's work force do you think is able to get their employer to pay out their wage within a Bitcoin layer 2 system? If layer 2 systems only support people who receive their wages within that layer 2 system already, how useful is it really at increasing the adoption of Bitcoin? Also, as far as I can see, it would require us to redefine what a "bitcoin" actually is. Right now, it constitutes something in the Bitcoin blockchain, whereas some proponents of layer 2 protocols seem to wish that we redefine it to include unconfirmed Bitcoin transactions. I'm not saying this can't become the case, at some point, but right now no one considers the holder of an unconfirmed Bitcoin transaction to be in possession of bitcoins. So, at one level or another, something needs to change.
  - ArchD 9y ago
    If an employer is willing to pay the employee bitcoin in layer 1, how much less willing would the employer be to pay in layer 2? Not much, I think. It doesn't seem that it should be much harder to use layer 2 instead of layer 1. If it is, then isn't this a usability issue affecting all users and not just employers? If the employer is willing to only pay fiat, then there is no new problem, is there?
  - PaulAJ 9y ago
    A bitcoin is just an entry in the BTC blockchain ledger. And I think you are misunderstanding the concepts in what you call "layer 2". The idea of the Lightning Network (which I assume you are referring to) is that you can execute off-chain transactions without needing to trust anyone. Its not the same as an "unconfirmed transaction" which leaves you open to a double-spend attack.
    - runeks 9y ago
      > A bitcoin is just an entry in the BTC blockchain ledger. I agree. > The idea of the Lightning Network (which I assume you are referring to) is that you can execute off-chain transactions without needing to trust anyone. Being off-chain, a LN transaction is not a bitcoin by your definition. While LN might be trustless, it's not the case than an LN-transaction is as good as a bitcoin in the blockchain. With LN, there's a race against time, whereby a node can lose funds received through LN, if it fails to settle on the blockchain. So the two (blockchain-tx vs LN-tx) are definitely not equivalent, but it's possible that future schemes can close that gap. Timeouts are a necessary part of payment channels, since if you just send your bitcoins to a 2-of-2 multi-sig address willy nilly, the owner of the other key can hold your funds hostage unless you give him half. Hence the timeout, after which funds sent to the 2-of-2 multi-sig address can be redeemed by just a single public key (the sender's). The receiver needs to publish a transaction (that redeems the same 2-of-2 multi-sig output) to the blockchain before this point in time, or the funds received through the channel are up for grabs.
m3kw9 9y ago
I’ve never heard of such metric, being useful measure of utilization without indicating duration or with another metric.
- bitxbitxbitcoin 9y ago
  Seriously. What about off chain transactions and their already extant impact on the velocity? From the oft-cited coinbase customer email to coinbase customer email "bitcoin" transaction to handing the private key over to somebody, behind a hologram or not, these types of transactions don't appear on the blockchain but they certainly do effect the economy.
emeth 9y ago
> When a user receives money – which humans usually receive monthly as wages/salaries – they need to deposit it into the layer 2 system, in order for it to be available within it. If my employer pays me in bitcoins from their coinbase account to my coinbase account, that transaction doesn't touch the chain. I can then send bitcoins from my coinbase account to another coinbase account, again without touching the chain. Why wouldn't the employer pay wages in the layer 2 system to begin with?
- runeks 9y ago
  > Why wouldn't the employer pay wages in the layer 2 system to begin with? (Author here) Very few employers pay wages denominated in bitcoins. If you're lucky enough that an employer is willing to pay a part of your wage within a layer 2-system, you're right. For all the people who receive their wages in national currency (of whichever country they live in), they have to go via the blockchain, and thus run into this limit. Also, it seems to me that, if layer 2 protocols want to solve Bitcoin scalability in order to increase adoption, it doesn't make sense for it to depend on everyone having adopted Bitcoin already (which, I would argue, would be the case if most people received their wages as bitcoins).
  - deleted 9y ago
    [deleted]
  - rlpb 9y ago
    > Very few employers pay wages denominated in bitcoins. Very few merchants accept payment denominated in bitcoins, either. And these two statements are clearly tied together. If, upon bitcoin scaling up in the economny, more merchants accepted bitcoins, then it follows that more employers would pay wages denominated in bitcoins. If the state of affairs remains the same as it is today, then there is no need for me to buy into layer 2 protocols monthly. My monthly spend in bitcoins will remain a fraction of my monthly wage. I could afford to buy into layer 2 annually easily enough. If more of the economy moves into bitcoins, then employers will pay wages in bitcoins by definition. And at that stage, it will be feasible for them to pay in layer 2. Either way, I think this exposes a vital flow in your chain of reasoning.
augustl 9y ago
No Bitcoin-based protocol that handles money, at least. https://www.civic.com/ https://www.civic.com/ is based on the Bitcoin protocol. It's a service for putting signed information about a user in a block chain, so that you don't need to implement your own verification of adresses, phone numbers, e-mails, etc being real, as long as you trust the signer of that information in the Civic block chain. This is a read heavy, not write heavy, block chain - reads of signed information is more common that writes of the signatures. It's definitely my favorite block chain based technology that isn't a currency.
- xdeqx366 9y ago
  What double spend problem is that solving though? Why not a broadcast network? Why blockchain...
  - majewsky 9y ago
    It's just because "blockchain" is the new magic word that gets you funded. You can do the same with public-key cryptography, but that's boring 70s technology. Who'd want that!?
    - drngdds 9y ago
      Isn't "the same with public-key cryptography" exactly what Keybase is?
      - RasputinsBro 9y ago
        I'm not the guy you were talking to, but I still don't know what keybase actually is. Let me know if you understand it.
        aaomidi 9y ago
        You put your public (and private if you want) pgp key on there. Then you make public posts on your social media signed with that key. This way, you show everyone that you own these accounts or websites or whatever. If any of the proofs changes, it puts it on a timeline. If your account has a hard reset it notifies all your followers. Basically its safeish key sharing in the modern world.
sphix0r 9y ago
When explaining bitcoin to non technical people I compare bitcoin for the to gold. Almost all non-tech people I know think bitcoin is the new next currency, I doubt it. Blockchain is currently hyped as currency, but it could solve many things related to trust, which is not only currency. An other new technology to watch is IOTA ( https://iota.org https://iota.org ) not blockchain based, no fees and scalable.
- yathern 9y ago
  Most non tech people I know are barely aware of it - or think of it as "that thing you use to buy black market stuff".
- charlesdm 9y ago
  The design of Bitcoin is inherently flawed at the moment (at least for payments), and due to its decentralised structure, a change can't easily be forced. I think Bitcoin was a great experiment since it brought us the blockchain, but with the exception of being a store of value (i.e. digital gold, and thus not having to worry too much about high transaction fees) I don't see it going anywhere. But since gold is worth about $8.2tn globally, that might be sufficient. Ethereum on the other hand.. by the looks of it that does seem to have a bright future. It improves upon and fixes many of the flaws Bitcoin has.
  - tfha 9y ago
    It improves upon and fixes a few of the Bitcoin flaws while introducing a whole hoard of other flaws in itself. For example, most 'full nodes' on the Ethereum blockchain have never actually verified the whole chain, they've instead started life by downloading a trusted snapshot from a miner. The scalability properties of Ethereum are dozens of times worse from a raw resource usage perspective, with each transaction on the Ethereum network taking more space to store, more clock cycles to process + verify, and with the whole system being much harder to parallelize. Ethereum made a lot of long term sacrifices to achieve their short term advantages, and it's already falling apart around the edges. One or two more iterations of hardforks + block size increases (gas limit increases) and your average desktop computer won't be able to keep up with the chain anymore, let alone catch up if starting from scratch. And that's just one of the many ameture compromises.
flotillo 9y ago
Blockchain protocols typically aren't designed to be scalable because, based on what they are actually used for, they don't need to be. Bitcoin was a cryptography research project that became popular outside of the usual circle of people interested in such things mostly due to these three somewhat overlapping groups: get-rich-quick types, criminals, and people who have deluded themselves into believing that Bitcoin will usurp the world's major currencies. One those three, only the last group have any interest in massively scaling up blockchain technologies. Those looking to speculate on Bitcoin markets have no such concern, and the criminals are just feeding off Bitcoin's popularity for this rather than having an interest in making it scale; besides, they'd prefer a more anonymized cryptocoin to be popular rather than something that makes public the entire transaction history. The 'true believers' of Bitcoin are outnumbered not only by these other two groups, but also by the general population who have no use case for Bitcoin at all. This is why scalability is such a fringe issue for Bitcoin and other blockchain protocols - they're all just solutions looking for mass-scale problems.
- bitxbitxbitcoin 9y ago
  So there are four groups? The usual circle, the get-rick-quick types, criminals, and people who have deluded themselves into believing that Bitcoin will usurp the world's major currencies? Do only the 1st and 4th group hold? The 2nd manipulates the market best they can, and only the 3rd and maybe some in the 1st are actually using it? May I ask - What do you think are hallmarks of the usual people or the true believers of Bitcoin?
__s 9y ago
ITT: pumpers
mcintyre1994 9y ago
Why do all of everybody's step 1 transactions have to be within a single block? Do the proposed 'layer 2' ideas only work inside one block? It's not obvious why you can't pay into 'layer 2' from arbitrarily many Blockchain blocks, but I'm not really familiar with any of the proposals.
quadcore 9y ago
An idea would be to not use one blockchain but a tree of blockchains. Say one blockchain is attributed to London so that if you make a transaction in that blockchain it should be quite fast. Now you want to send money to bangkok, the transaction bubbles up and you get the idea. edit: obviously someone got that idea before; my point was meant to be that it would be a shame to use a centralised solution like the services of private companies.
- augustl 9y ago
  Wow, that's super interesting, I've never heard about something like that proposed before. Same protocol, but layered and sharded, basically.
  - NotUsingLinux 9y ago
    Ethereum sharding? https://github.com/ethereum/wiki/wiki/Sharding-FAQ https://github.com/ethereum/wiki/wiki/Sharding-FAQ
  - Buttes 9y ago
    The Ethereum guys proposed something like this in a super long rambling document with lots of made up terminology [1] https://github.com/ethereum/wiki/wiki/Sharding-FAQ https://github.com/ethereum/wiki/wiki/Sharding-FAQ
  - AluminiumPoint 9y ago
    Yeah! We can also do 'cross chain atomic swaps'; A trustless tx that allows two chains to agree on a price. Either both sides claim it, or the money is returned to its sender.
  - sudoscript 9y ago
    Check out Ethereum's Plasma proposal: plasma.io. It's a similar concept. I'd describe it as tree of blockchains with MapReduce for state transitions and merkle trees for proofs.
  - markjkowalski 9y ago
gruez 9y ago
tl;dr: the old "bitcoin can only do 7 tps" argument, except with an extra bit that says even with layer 2 scaling, if each user has to transact once a month on-chain (because... salaries?) then max users is 20M (which is 7tps multiplied by 1month). All in all, not very interesting because there's no reason why salaries can't be paid on l2 as well (securely as well, if LN is used).
- __s 9y ago
  So thought experiment: the incentive to stay on L2 is anonymity & lower transaction fees. Therefore as usage goes up transaction fees will raise but more will be pushed to L2 in order to avoid those fees, & in effect reducing them So let's say things have exploded: transaction fees are twice my salary. If I get stiffed on L2 I'll have to pay more in fees than my salary. So my recourse will be to sue my employer into paying the transaction fee Obvious answer to this: L3
  - sunshinerag 9y ago
    L3: .. Ln - infinite scaling :)
  - bitxbitxbitcoin 9y ago
    Then L4 :).
knocte 9y ago
The author is just assuming an expiry time of the payment channels of one month, which is not realistic in an hypothetical scenario in which layer2 protocols started to become prevalent in the cryptocurrency space: the more people trust this new software stacks, the longer the expiry times people will give to their deposits, because they will not mind locking money which will be just useful in the Layer2 area, if most of the merchants move to this layer as well, and because the longer your expiry dates are, the less fees (blockchain fees) one will have to pay.
- EGreg 9y ago
  So basically, we are back to a federated system :)
  - deleted 9y ago
    [deleted]
  - knocte 9y ago
    I don't understand your point, please elaborate.
    - EGreg 9y ago
      Banks have a federated system. The internet is a network of networks. Same here. People tend to do the most business inside local communities. And then cross-community payments use the internet. It is not totally distributed and peer-to-peer. There are trusted intermediaries.
      - knocte 9y ago
        The big difference between Layer2 and the banking system is that Layer2 is still a trust-less protocol in the same way Layer1 is. There's no counterparty-risk in Layer2. Yes, most supernodes in Layer2 will probably be big payment-insitutions, but nothing will prevent you (or anyone) to become a Layer2 node as well, either.
ethn 9y ago
All true except that a transaction can have around 400 inputs per standard size transaction. You were assuming a single input. This means Bitcoin-based protocols can handle 8B users per month, which is more payments than the ACH handles per month.
- mcguire 9y ago
  Uh, what was the problem BTC was supposed to solve, originally?
  - omon 9y ago
    Trustless transactions: transactions with a guarantee of state.
- runeks 9y ago
  > All true except that a transaction can have around 400 inputs per standard size transaction. (Author here) I'm not sure what you mean by this. A transaction can have lots of inputs, yes, but they take up space -- in fact they are the largest part of the transaction, since they contain signature (~72 bytes), public key (~33 bytes), as well as redeemed txid+input index (32+4 bytes). The 224-byte transaction used as an example has a single input and two outputs (one destination address; one change address). A standard (pay-to-pubkey-hash) transaction with two inputs and two outputs is ~373 bytes. A 400-input (2-output) transaction would be roughly 60KB.
  - ethn 9y ago
    Standard size transaction is up to 100KB.
ploggingdev 9y ago
OP makes the implicit assumption that all lightning network payment channels are p2p in which case the 20M users per month upper limit is true. From what I understand, the plan is to have a network of supernodes which settle on the blockchain. Users will interact with these nodes instead of true p2p. Lightning network opponents argue that these supernodes will become mini banks in some ways and will need to follow KYC norms. While it's possible to do p2p payment channels without interacting with any third party, the high transaction fees make it impractical. From the Lightning Network paper [0] : > If all transactions using Bitcoin were conducted inside a network of micropayment channels, to enable 7 billion people to make two channels per year with unlimited transactions inside the channel, it would require 133 MB blocks (presuming 500 bytes per transaction and 52560 locks per year). Notice the 2 channels per year. These 2 channels will be opened with a supernode (operated by eg- Coinbase, Gemini, Blockstream etc). I glanced through the document but they don't seem to acknowledge the requirement for these supernodes. It's hard to cut through all the FUD, trolling, memes and propaganda to get to the meat of the debate, so I'm not too sure my understanding is accurate, feel free to correct me. [0] https://lightning.network/lightning-network-paper.pdf https://lightning.network/lightning-network-paper.pdf
- xiphias 9y ago
  There are many things the author didn't think about. With Segregated Witness, the signatures don't need to be part of the 1MB block. Also for multi-sig we will be using aggregatable Schnorr signatures, so multi-sig won't take that much space. Still, the cost of an on-blockchain transaction will probably go up to $1000-10000 in current US dollars, so I believe even having an on-chain transaction will get too expensive for most people. For the short term lightning should be a relief though until the community can come up with the next scaling solutions (after implementing Mimblewimble as well)
  - the_stc 9y ago
    >short term lightning Can you clarify what this means? Last I read, Lightning was 18 months out. But not really, that's just a number tossed to a crowd. The preview tech published a month ago is nowhere near being ready for use.
fiatjaf 9y ago
What about Ripple and Stellar? How many users these can handle?
- pat2man 9y ago
  Bitcoin can do about 7 transactions per second and Ripple tests have shown it can handle about 70,000. In the real world Ripple has never hit anything near that so we don't know for sure.
phasnox 9y ago
You are wrong. But interesting! Take a look a the following scenario where Bob works for Company A and has a monthly salary of 1.5btc: - CompanyA opens a 100btc channel with Amazon - Bob has an 2btc channel opened with Amazon ------------------------------ Now lets say, that at a start, channels look like this: - Company A 100btc -> Amazon 0btc - Bob 2btc -> Amazon 0btc ------------------------------ As the month goes through, Bob starts spending his money on Amazon and other stores that have channels opened with them. Company A also spends their money paying suppliers and other expenses. After 2 weeks, channels look like this: - Company A 40btc -> Amazon 60btc - Bob 0.75btc -> Amazon 1.25btc ------------------------------ Its the end of the month, many Clients have payed their bills, and Bob has almost consumed all his salary. - Company A 95btc -> Amazon 5btc - Bob 0.5btc -> Amazon 1.5btc ------------------------------ Now its time for company A to pay salaries. And we go back to step 1. Rinse and repeat. But I think you are right on one thing. Eventually the 1mb block limit has to be raised.
- wolfgang42 9y ago
  I think you have changed Bob's scenario halfway through--he has a monthly salary of 1.5btc, yet somehow has 2btc to spend?
  - phasnox 9y ago
    He has a side project. He sells pancakes.
antocv 9y ago
The only good scaling/high throughput consensus algorithm is Byteball. The block-chain does not scale, DAG coins suffer form various issues, the only DAG-coin with semi-trustless distributed "consensus" is Byteball. The implementation sucks, the algorithm is nice and innovative.
- EthanHeilman 9y ago
  > The only good scaling/high throughput consensus algorithm is Byteball. SPECTRE [0] is pretty good, not implemented in any cryptocurrency yet. [0]: https://medium.com/@avivzohar/the-spectre-protocol-7dbbebb707b5 https://medium.com/@avivzohar/the-spectre-protocol-7dbbebb70...
  - tatersolid 9y ago
    Interesting paper. You could almost rename SPECTRE as “GitCoin” (trademark me) as the various tips of the branches are effectively merged.
xasos 9y ago
The community is well-aware of this problem already, right? Title seems a bit click-baity, but it's definitely an active area of research. Bitcoin is still less than a decade old :)
futun 9y ago
Would it be safe to say that: A) Bitcoin could have been better designed to scale to ultra-large / global scales? B) The principal reason for not scrapping it and starting over is that most holders of bitcoin already attribute value to their holdings?
KasianFranks 9y ago
Time to buy.
calimac 9y ago
Let's get to 10M monthly users before we worry about 20M monthly. I like the thoughtfulness but don't think it is insurmountable.
stcredzero 9y ago
Why not have several thousand block chains? Just having 2^13 blockchains would be enough for 100 billion users. New blockchains could be rolled out as needed. Perhaps a blockchain could mitotically divide as needed?
- whiskers08xmt 9y ago
  There are some projects working on solutions like this, but the problem becomes how you move funds between these blockchains.
  - lowglow 9y ago
    I'm interesting in someone exploring atomic swaps.
    - lowglow 9y ago
      interested
feelin_googley 9y ago
The world now has a compelling reason to make the internet operate again as peer-to-peer in addition to client-server? (I am presuming there is a reason bitcoin was originally designed as peer-to-peer and not client-server i.e. it was not an arbitrary decision.) The silver lining of the bitcoin movement, if there is one, could be that it provides internet users with reasons to want the network to reliably operate peer-to-peer. Not to mention reasons to want to understand and use asymmetric cryptography.
- ZenoArrow 9y ago
  It's nothing to do with peer-to-peer vs client-server. The main issue is keeping the blockchain up to date. Client-server can actually be more efficient than peer-to-peer in disseminating blockchain updates, but it's still not enough. Bear in mind that, in order for all users to keep a full copy of the blockchain, every time a transaction is carried out every single copy of the blockchain needs to be updated. Beyond a certain level that simply isn't scalable, as it has a big impact on performance. The only pragmatic way to scale the network beyond that point is to only have some nodes having a full copy of the blockchain, at which point you've got more of a client-server model.
lowglow 9y ago
We'd be down for someone to come out and chat about this at our next crypto builders meet-up at Noisebridge in SF on the 11th.[0] Scaling is a huge point of interest when considering building on top of BTC or ETH. [0] https://www.meetup.com/sfhackdays/events/243614539/ https://www.meetup.com/sfhackdays/events/243614539/
curyous 9y ago
This article gets it completely wrong. Bitcoin can handle much more than 20M users without layer 2 services. Layer 2 services are a solution looking for a problem that doesn't exist.
rothbardrand 9y ago
The max block size for segwit transactions is about 3.7mb. The idea that bitcoin blocks are limited to 1mb is false, and its being propagandized as such by people who really want to fire core and take over the bitcoin brand. It has nothing to do with technology (because as I pointed out the max block size quadrupled in August.) It's also worth noting that segwit transactions are more efficient and segwit paves the way for even more efficient transaction formats in the future, so that 225byte average transaction size will go down over time. SegWit was just activated in August. The core client that utilizes it is still in testing (or was recently released) so segwit is still very early in its adoption stages. Along with Lightening Network and side chains (a whole other form of scalability) and other layer 2 solutions, SegWit contains multiple layer one scalability solutions, not just SegWit itself and the block size increase, but efficiencies across the board-- and over the past 2 years core has been making bitcoin more efficient, and scalable, with many releases and many optimizations... none of which are talked about in the "scaling debate" because its really a "I want to be king fo bitcoin" debate.
tfha 9y ago
This hopefully throws some context on the scaling debate. The giant fight, a fight from 1MB to 2MB, would allow Bitcoin to scale from 20 million monthly users, to 40 million monthly users. It's not a big upgrade. Any exec at Facebook, Snapchat, Uber, etc. would laugh you out of the room if you suggested that we should have a company-splitting and devastating debate that sidetracks development for 2 years over scaling the platform from 20 million to 40 million users. It just doesn't make sense. Which is one of the big reasons the small blockers resist the 2mb hardfork. For all the pain that this debate has brought about, there's very little upside in the grand scheme of things. We scale Bitcoin from an insignificant number of users to still an insignificant number of users. If we find a scaling solution, it's going to come from somewhere else.
- stephenbez 9y ago
  FWIW, the block size of Bitcoin Cash is 8MB not 2MB: https://www.bitcoincash.org/ https://www.bitcoincash.org/ "As a first step, the blocksize limit has been made adjustable, with an increased default of 8MB. Research is underway to allow massive future increases."
rpedela 9y ago
If networks and/or computers were faster, would that increase the max throughput? Or is the max throughput fundamental to the blockchain algorithm?
eralpb 9y ago
Interesting to see this get so many upvotes & discussion. Blockchain is an agreed protocol not a god-given thing, any time we need more we can just increase the block-size. This blog post would make sense if it talked about why incrementing block-size is not feasible, which is feasible. Storage gets cheaper every year and block-size has no effect on compute power.

276 points by runeks 9y ago

Kelab 9y ago

Even dash/litecoin? Maybe dpos will win e.g steemit kevin ross just joined

tudorconstantin 9y ago

Why can't people be paid directly on one of the layer 2 systems?

Filligree 9y ago
At that point, aren't you just reinventing fiat money?
- drcode 9y ago
  No, a blockchain 2nd later system still gives strong security guarantees that are similar to the 1st later system.
  - cma 9y ago
    > still gives strong security guarantees that are similar to the 1st later system. Like Mt. Gox?
    - kristofferR 9y ago
      No, not like Mt. Gox.
    - vertex-four 9y ago
      The "second layer system" that people are actually talking about is Lightning Network, the basic idea of which has been around for a few years now. Basically, you open a "payment channel" of X bitcoins with someone else in the network, and you can trade up to X bitcoins with them almost-trustlessly - cheating is easily detectable within the protocol, and results in the party detecting the cheating settling the payment channel on the blockchain. Payment channels can be linked, so you can send money from A to B through payment channels A-X, X-Y, Y-B, without actually trusting any of those entities. So blockchain transactions only ever happen when someone wants to open a new payment channel (which is only relatively rarely), when someone they directly have a payment channel open with attempts to cheat, and in the rare occasions that someone wants to hold "actual" bitcoins rather than a cryptographic promise of bitcoins. There's no entity within this system which has central control over currency that goes through this system, and all cheating is detectable with rollbacks in place when it happens, so it's not like a bank, exchange, or even a traditional payment processing network at all. Note: I have my own qualms with cryptocurrencies and the human layer, but you've got to admit the technological backing is sound within reasonable parameters.
    - haakon 9y ago
      Mt. Gox was a centralised custodian. Layer 2 systems like Lightning Network are not, because they can't run away with your money. If they try to cheat, you can always withdraw your money.
      - the_stc 9y ago
        But detecting cheating and withdrawing requires you to have client software online and monitoring. Which individuals can not do and thus will outsource it to their payment handling company which will probably be the same as the LN hub.
        haakon 9y ago
        It can be outsourced to trustless third party, who also has no control over your money and cannot cheat.
- quickben 9y ago
  It depends on the purpose. For example: You can't hype fiat money anymore, too much liquidity.
- keymone 9y ago
  Layer 2 is not money and so can’t be fiat. Lightning network is just a clever way to construct bitcoin transactions such that it is possible to send sub-transactions via different communication channel(not congesting bitcoin network) but preserving crypto currency guarantees.
  - knocte 9y ago
    > Layer 2 is not money Ehrm, what? So Layer1 is not money for you either? Explain... PS: I'm not agreeing with that "this is reinventing fiat money" comment.
    - keymone 9y ago
      layer 2 is the payment processing network, money being transferred remains bitcoin.
runeks 9y ago
(Author here) They can, but how large a part of the world's work force do you think is able to get their employer to pay out their wage within a Bitcoin layer 2 system? If layer 2 systems only support people who receive their wages within that layer 2 system already, how useful is it really at increasing the adoption of Bitcoin? Also, as far as I can see, it would require us to redefine what a "bitcoin" actually is. Right now, it constitutes something in the Bitcoin blockchain, whereas some proponents of layer 2 protocols seem to wish that we redefine it to include unconfirmed Bitcoin transactions. I'm not saying this can't become the case, at some point, but right now no one considers the holder of an unconfirmed Bitcoin transaction to be in possession of bitcoins. So, at one level or another, something needs to change.
- ArchD 9y ago
  If an employer is willing to pay the employee bitcoin in layer 1, how much less willing would the employer be to pay in layer 2? Not much, I think. It doesn't seem that it should be much harder to use layer 2 instead of layer 1. If it is, then isn't this a usability issue affecting all users and not just employers? If the employer is willing to only pay fiat, then there is no new problem, is there?
- PaulAJ 9y ago
  A bitcoin is just an entry in the BTC blockchain ledger. And I think you are misunderstanding the concepts in what you call "layer 2". The idea of the Lightning Network (which I assume you are referring to) is that you can execute off-chain transactions without needing to trust anyone. Its not the same as an "unconfirmed transaction" which leaves you open to a double-spend attack.
  - runeks 9y ago
    > A bitcoin is just an entry in the BTC blockchain ledger. I agree. > The idea of the Lightning Network (which I assume you are referring to) is that you can execute off-chain transactions without needing to trust anyone. Being off-chain, a LN transaction is not a bitcoin by your definition. While LN might be trustless, it's not the case than an LN-transaction is as good as a bitcoin in the blockchain. With LN, there's a race against time, whereby a node can lose funds received through LN, if it fails to settle on the blockchain. So the two (blockchain-tx vs LN-tx) are definitely not equivalent, but it's possible that future schemes can close that gap. Timeouts are a necessary part of payment channels, since if you just send your bitcoins to a 2-of-2 multi-sig address willy nilly, the owner of the other key can hold your funds hostage unless you give him half. Hence the timeout, after which funds sent to the 2-of-2 multi-sig address can be redeemed by just a single public key (the sender's). The receiver needs to publish a transaction (that redeems the same 2-of-2 multi-sig output) to the blockchain before this point in time, or the funds received through the channel are up for grabs.

m3kw9 9y ago

I’ve never heard of such metric, being useful measure of utilization without indicating duration or with another metric.

bitxbitxbitcoin 9y ago
Seriously. What about off chain transactions and their already extant impact on the velocity? From the oft-cited coinbase customer email to coinbase customer email "bitcoin" transaction to handing the private key over to somebody, behind a hologram or not, these types of transactions don't appear on the blockchain but they certainly do effect the economy.

emeth 9y ago

> When a user receives money – which humans usually receive monthly as wages/salaries – they need to deposit it into the layer 2 system, in order for it to be available within it. If my employer pays me in bitcoins from their coinbase account to my coinbase account, that transaction doesn't touch the chain. I can then send bitcoins from my coinbase account to another coinbase account, again without touching the chain. Why wouldn't the employer pay wages in the layer 2 system to begin with?

runeks 9y ago
> Why wouldn't the employer pay wages in the layer 2 system to begin with? (Author here) Very few employers pay wages denominated in bitcoins. If you're lucky enough that an employer is willing to pay a part of your wage within a layer 2-system, you're right. For all the people who receive their wages in national currency (of whichever country they live in), they have to go via the blockchain, and thus run into this limit. Also, it seems to me that, if layer 2 protocols want to solve Bitcoin scalability in order to increase adoption, it doesn't make sense for it to depend on everyone having adopted Bitcoin already (which, I would argue, would be the case if most people received their wages as bitcoins).
- deleted 9y ago
  [deleted]
- rlpb 9y ago
  > Very few employers pay wages denominated in bitcoins. Very few merchants accept payment denominated in bitcoins, either. And these two statements are clearly tied together. If, upon bitcoin scaling up in the economny, more merchants accepted bitcoins, then it follows that more employers would pay wages denominated in bitcoins. If the state of affairs remains the same as it is today, then there is no need for me to buy into layer 2 protocols monthly. My monthly spend in bitcoins will remain a fraction of my monthly wage. I could afford to buy into layer 2 annually easily enough. If more of the economy moves into bitcoins, then employers will pay wages in bitcoins by definition. And at that stage, it will be feasible for them to pay in layer 2. Either way, I think this exposes a vital flow in your chain of reasoning.

augustl 9y ago

No Bitcoin-based protocol that handles money, at least. https://www.civic.com/ https://www.civic.com/ is based on the Bitcoin protocol. It's a service for putting signed information about a user in a block chain, so that you don't need to implement your own verification of adresses, phone numbers, e-mails, etc being real, as long as you trust the signer of that information in the Civic block chain. This is a read heavy, not write heavy, block chain - reads of signed information is more common that writes of the signatures. It's definitely my favorite block chain based technology that isn't a currency.

xdeqx366 9y ago
What double spend problem is that solving though? Why not a broadcast network? Why blockchain...
- majewsky 9y ago
  It's just because "blockchain" is the new magic word that gets you funded. You can do the same with public-key cryptography, but that's boring 70s technology. Who'd want that!?
  - drngdds 9y ago
    Isn't "the same with public-key cryptography" exactly what Keybase is?
    - RasputinsBro 9y ago
      I'm not the guy you were talking to, but I still don't know what keybase actually is. Let me know if you understand it.
      - aaomidi 9y ago
        You put your public (and private if you want) pgp key on there. Then you make public posts on your social media signed with that key. This way, you show everyone that you own these accounts or websites or whatever. If any of the proofs changes, it puts it on a timeline. If your account has a hard reset it notifies all your followers. Basically its safeish key sharing in the modern world.

sphix0r 9y ago

When explaining bitcoin to non technical people I compare bitcoin for the to gold. Almost all non-tech people I know think bitcoin is the new next currency, I doubt it. Blockchain is currently hyped as currency, but it could solve many things related to trust, which is not only currency. An other new technology to watch is IOTA ( https://iota.org https://iota.org ) not blockchain based, no fees and scalable.

yathern 9y ago
Most non tech people I know are barely aware of it - or think of it as "that thing you use to buy black market stuff".
charlesdm 9y ago
The design of Bitcoin is inherently flawed at the moment (at least for payments), and due to its decentralised structure, a change can't easily be forced. I think Bitcoin was a great experiment since it brought us the blockchain, but with the exception of being a store of value (i.e. digital gold, and thus not having to worry too much about high transaction fees) I don't see it going anywhere. But since gold is worth about $8.2tn globally, that might be sufficient. Ethereum on the other hand.. by the looks of it that does seem to have a bright future. It improves upon and fixes many of the flaws Bitcoin has.
- tfha 9y ago
  It improves upon and fixes a few of the Bitcoin flaws while introducing a whole hoard of other flaws in itself. For example, most 'full nodes' on the Ethereum blockchain have never actually verified the whole chain, they've instead started life by downloading a trusted snapshot from a miner. The scalability properties of Ethereum are dozens of times worse from a raw resource usage perspective, with each transaction on the Ethereum network taking more space to store, more clock cycles to process + verify, and with the whole system being much harder to parallelize. Ethereum made a lot of long term sacrifices to achieve their short term advantages, and it's already falling apart around the edges. One or two more iterations of hardforks + block size increases (gas limit increases) and your average desktop computer won't be able to keep up with the chain anymore, let alone catch up if starting from scratch. And that's just one of the many ameture compromises.

flotillo 9y ago

Blockchain protocols typically aren't designed to be scalable because, based on what they are actually used for, they don't need to be. Bitcoin was a cryptography research project that became popular outside of the usual circle of people interested in such things mostly due to these three somewhat overlapping groups: get-rich-quick types, criminals, and people who have deluded themselves into believing that Bitcoin will usurp the world's major currencies. One those three, only the last group have any interest in massively scaling up blockchain technologies. Those looking to speculate on Bitcoin markets have no such concern, and the criminals are just feeding off Bitcoin's popularity for this rather than having an interest in making it scale; besides, they'd prefer a more anonymized cryptocoin to be popular rather than something that makes public the entire transaction history. The 'true believers' of Bitcoin are outnumbered not only by these other two groups, but also by the general population who have no use case for Bitcoin at all. This is why scalability is such a fringe issue for Bitcoin and other blockchain protocols - they're all just solutions looking for mass-scale problems.

bitxbitxbitcoin 9y ago
So there are four groups? The usual circle, the get-rick-quick types, criminals, and people who have deluded themselves into believing that Bitcoin will usurp the world's major currencies? Do only the 1st and 4th group hold? The 2nd manipulates the market best they can, and only the 3rd and maybe some in the 1st are actually using it? May I ask - What do you think are hallmarks of the usual people or the true believers of Bitcoin?

__s 9y ago

ITT: pumpers

mcintyre1994 9y ago

Why do all of everybody's step 1 transactions have to be within a single block? Do the proposed 'layer 2' ideas only work inside one block? It's not obvious why you can't pay into 'layer 2' from arbitrarily many Blockchain blocks, but I'm not really familiar with any of the proposals.

quadcore 9y ago

An idea would be to not use one blockchain but a tree of blockchains. Say one blockchain is attributed to London so that if you make a transaction in that blockchain it should be quite fast. Now you want to send money to bangkok, the transaction bubbles up and you get the idea. edit: obviously someone got that idea before; my point was meant to be that it would be a shame to use a centralised solution like the services of private companies.

augustl 9y ago
Wow, that's super interesting, I've never heard about something like that proposed before. Same protocol, but layered and sharded, basically.
- NotUsingLinux 9y ago
  Ethereum sharding? https://github.com/ethereum/wiki/wiki/Sharding-FAQ https://github.com/ethereum/wiki/wiki/Sharding-FAQ
- Buttes 9y ago
  The Ethereum guys proposed something like this in a super long rambling document with lots of made up terminology [1] https://github.com/ethereum/wiki/wiki/Sharding-FAQ https://github.com/ethereum/wiki/wiki/Sharding-FAQ
- AluminiumPoint 9y ago
  Yeah! We can also do 'cross chain atomic swaps'; A trustless tx that allows two chains to agree on a price. Either both sides claim it, or the money is returned to its sender.
- sudoscript 9y ago
  Check out Ethereum's Plasma proposal: plasma.io. It's a similar concept. I'd describe it as tree of blockchains with MapReduce for state transitions and merkle trees for proofs.
- markjkowalski 9y ago

gruez 9y ago

tl;dr: the old "bitcoin can only do 7 tps" argument, except with an extra bit that says even with layer 2 scaling, if each user has to transact once a month on-chain (because... salaries?) then max users is 20M (which is 7tps multiplied by 1month). All in all, not very interesting because there's no reason why salaries can't be paid on l2 as well (securely as well, if LN is used).

__s 9y ago
So thought experiment: the incentive to stay on L2 is anonymity & lower transaction fees. Therefore as usage goes up transaction fees will raise but more will be pushed to L2 in order to avoid those fees, & in effect reducing them So let's say things have exploded: transaction fees are twice my salary. If I get stiffed on L2 I'll have to pay more in fees than my salary. So my recourse will be to sue my employer into paying the transaction fee Obvious answer to this: L3
- sunshinerag 9y ago
  L3: .. Ln - infinite scaling :)
- bitxbitxbitcoin 9y ago
  Then L4 :).

knocte 9y ago

The author is just assuming an expiry time of the payment channels of one month, which is not realistic in an hypothetical scenario in which layer2 protocols started to become prevalent in the cryptocurrency space: the more people trust this new software stacks, the longer the expiry times people will give to their deposits, because they will not mind locking money which will be just useful in the Layer2 area, if most of the merchants move to this layer as well, and because the longer your expiry dates are, the less fees (blockchain fees) one will have to pay.

EGreg 9y ago
So basically, we are back to a federated system :)
- deleted 9y ago
  [deleted]
- knocte 9y ago
  I don't understand your point, please elaborate.
  - EGreg 9y ago
    Banks have a federated system. The internet is a network of networks. Same here. People tend to do the most business inside local communities. And then cross-community payments use the internet. It is not totally distributed and peer-to-peer. There are trusted intermediaries.
    - knocte 9y ago
      The big difference between Layer2 and the banking system is that Layer2 is still a trust-less protocol in the same way Layer1 is. There's no counterparty-risk in Layer2. Yes, most supernodes in Layer2 will probably be big payment-insitutions, but nothing will prevent you (or anyone) to become a Layer2 node as well, either.

ethn 9y ago

All true except that a transaction can have around 400 inputs per standard size transaction. You were assuming a single input. This means Bitcoin-based protocols can handle 8B users per month, which is more payments than the ACH handles per month.

mcguire 9y ago
Uh, what was the problem BTC was supposed to solve, originally?
- omon 9y ago
  Trustless transactions: transactions with a guarantee of state.
runeks 9y ago
> All true except that a transaction can have around 400 inputs per standard size transaction. (Author here) I'm not sure what you mean by this. A transaction can have lots of inputs, yes, but they take up space -- in fact they are the largest part of the transaction, since they contain signature (~72 bytes), public key (~33 bytes), as well as redeemed txid+input index (32+4 bytes). The 224-byte transaction used as an example has a single input and two outputs (one destination address; one change address). A standard (pay-to-pubkey-hash) transaction with two inputs and two outputs is ~373 bytes. A 400-input (2-output) transaction would be roughly 60KB.
- ethn 9y ago
  Standard size transaction is up to 100KB.

ploggingdev 9y ago

OP makes the implicit assumption that all lightning network payment channels are p2p in which case the 20M users per month upper limit is true. From what I understand, the plan is to have a network of supernodes which settle on the blockchain. Users will interact with these nodes instead of true p2p. Lightning network opponents argue that these supernodes will become mini banks in some ways and will need to follow KYC norms. While it's possible to do p2p payment channels without interacting with any third party, the high transaction fees make it impractical. From the Lightning Network paper [0] : > If all transactions using Bitcoin were conducted inside a network of micropayment channels, to enable 7 billion people to make two channels per year with unlimited transactions inside the channel, it would require 133 MB blocks (presuming 500 bytes per transaction and 52560 locks per year). Notice the 2 channels per year. These 2 channels will be opened with a supernode (operated by eg- Coinbase, Gemini, Blockstream etc). I glanced through the document but they don't seem to acknowledge the requirement for these supernodes. It's hard to cut through all the FUD, trolling, memes and propaganda to get to the meat of the debate, so I'm not too sure my understanding is accurate, feel free to correct me. [0] https://lightning.network/lightning-network-paper.pdf https://lightning.network/lightning-network-paper.pdf

xiphias 9y ago
There are many things the author didn't think about. With Segregated Witness, the signatures don't need to be part of the 1MB block. Also for multi-sig we will be using aggregatable Schnorr signatures, so multi-sig won't take that much space. Still, the cost of an on-blockchain transaction will probably go up to $1000-10000 in current US dollars, so I believe even having an on-chain transaction will get too expensive for most people. For the short term lightning should be a relief though until the community can come up with the next scaling solutions (after implementing Mimblewimble as well)
- the_stc 9y ago
  >short term lightning Can you clarify what this means? Last I read, Lightning was 18 months out. But not really, that's just a number tossed to a crowd. The preview tech published a month ago is nowhere near being ready for use.

fiatjaf 9y ago

What about Ripple and Stellar? How many users these can handle?

pat2man 9y ago
Bitcoin can do about 7 transactions per second and Ripple tests have shown it can handle about 70,000. In the real world Ripple has never hit anything near that so we don't know for sure.

phasnox 9y ago

You are wrong. But interesting! Take a look a the following scenario where Bob works for Company A and has a monthly salary of 1.5btc: - CompanyA opens a 100btc channel with Amazon - Bob has an 2btc channel opened with Amazon ------------------------------ Now lets say, that at a start, channels look like this: - Company A 100btc -> Amazon 0btc - Bob 2btc -> Amazon 0btc ------------------------------ As the month goes through, Bob starts spending his money on Amazon and other stores that have channels opened with them. Company A also spends their money paying suppliers and other expenses. After 2 weeks, channels look like this: - Company A 40btc -> Amazon 60btc - Bob 0.75btc -> Amazon 1.25btc ------------------------------ Its the end of the month, many Clients have payed their bills, and Bob has almost consumed all his salary. - Company A 95btc -> Amazon 5btc - Bob 0.5btc -> Amazon 1.5btc ------------------------------ Now its time for company A to pay salaries. And we go back to step 1. Rinse and repeat. But I think you are right on one thing. Eventually the 1mb block limit has to be raised.

wolfgang42 9y ago
I think you have changed Bob's scenario halfway through--he has a monthly salary of 1.5btc, yet somehow has 2btc to spend?
- phasnox 9y ago
  He has a side project. He sells pancakes.

antocv 9y ago

The only good scaling/high throughput consensus algorithm is Byteball. The block-chain does not scale, DAG coins suffer form various issues, the only DAG-coin with semi-trustless distributed "consensus" is Byteball. The implementation sucks, the algorithm is nice and innovative.

EthanHeilman 9y ago
> The only good scaling/high throughput consensus algorithm is Byteball. SPECTRE [0] is pretty good, not implemented in any cryptocurrency yet. [0]: https://medium.com/@avivzohar/the-spectre-protocol-7dbbebb707b5 https://medium.com/@avivzohar/the-spectre-protocol-7dbbebb70...
- tatersolid 9y ago
  Interesting paper. You could almost rename SPECTRE as “GitCoin” (trademark me) as the various tips of the branches are effectively merged.

xasos 9y ago

The community is well-aware of this problem already, right? Title seems a bit click-baity, but it's definitely an active area of research. Bitcoin is still less than a decade old :)

futun 9y ago

Would it be safe to say that: A) Bitcoin could have been better designed to scale to ultra-large / global scales? B) The principal reason for not scrapping it and starting over is that most holders of bitcoin already attribute value to their holdings?

KasianFranks 9y ago

Time to buy.

calimac 9y ago

Let's get to 10M monthly users before we worry about 20M monthly. I like the thoughtfulness but don't think it is insurmountable.

stcredzero 9y ago

Why not have several thousand block chains? Just having 2^13 blockchains would be enough for 100 billion users. New blockchains could be rolled out as needed. Perhaps a blockchain could mitotically divide as needed?

whiskers08xmt 9y ago
There are some projects working on solutions like this, but the problem becomes how you move funds between these blockchains.
- lowglow 9y ago
  I'm interesting in someone exploring atomic swaps.
  - lowglow 9y ago
    interested

feelin_googley 9y ago

The world now has a compelling reason to make the internet operate again as peer-to-peer in addition to client-server? (I am presuming there is a reason bitcoin was originally designed as peer-to-peer and not client-server i.e. it was not an arbitrary decision.) The silver lining of the bitcoin movement, if there is one, could be that it provides internet users with reasons to want the network to reliably operate peer-to-peer. Not to mention reasons to want to understand and use asymmetric cryptography.

ZenoArrow 9y ago
It's nothing to do with peer-to-peer vs client-server. The main issue is keeping the blockchain up to date. Client-server can actually be more efficient than peer-to-peer in disseminating blockchain updates, but it's still not enough. Bear in mind that, in order for all users to keep a full copy of the blockchain, every time a transaction is carried out every single copy of the blockchain needs to be updated. Beyond a certain level that simply isn't scalable, as it has a big impact on performance. The only pragmatic way to scale the network beyond that point is to only have some nodes having a full copy of the blockchain, at which point you've got more of a client-server model.

lowglow 9y ago

We'd be down for someone to come out and chat about this at our next crypto builders meet-up at Noisebridge in SF on the 11th.[0] Scaling is a huge point of interest when considering building on top of BTC or ETH. [0] https://www.meetup.com/sfhackdays/events/243614539/ https://www.meetup.com/sfhackdays/events/243614539/

curyous 9y ago

This article gets it completely wrong. Bitcoin can handle much more than 20M users without layer 2 services. Layer 2 services are a solution looking for a problem that doesn't exist.

rothbardrand 9y ago

The max block size for segwit transactions is about 3.7mb. The idea that bitcoin blocks are limited to 1mb is false, and its being propagandized as such by people who really want to fire core and take over the bitcoin brand. It has nothing to do with technology (because as I pointed out the max block size quadrupled in August.) It's also worth noting that segwit transactions are more efficient and segwit paves the way for even more efficient transaction formats in the future, so that 225byte average transaction size will go down over time. SegWit was just activated in August. The core client that utilizes it is still in testing (or was recently released) so segwit is still very early in its adoption stages. Along with Lightening Network and side chains (a whole other form of scalability) and other layer 2 solutions, SegWit contains multiple layer one scalability solutions, not just SegWit itself and the block size increase, but efficiencies across the board-- and over the past 2 years core has been making bitcoin more efficient, and scalable, with many releases and many optimizations... none of which are talked about in the "scaling debate" because its really a "I want to be king fo bitcoin" debate.

tfha 9y ago

This hopefully throws some context on the scaling debate. The giant fight, a fight from 1MB to 2MB, would allow Bitcoin to scale from 20 million monthly users, to 40 million monthly users. It's not a big upgrade. Any exec at Facebook, Snapchat, Uber, etc. would laugh you out of the room if you suggested that we should have a company-splitting and devastating debate that sidetracks development for 2 years over scaling the platform from 20 million to 40 million users. It just doesn't make sense. Which is one of the big reasons the small blockers resist the 2mb hardfork. For all the pain that this debate has brought about, there's very little upside in the grand scheme of things. We scale Bitcoin from an insignificant number of users to still an insignificant number of users. If we find a scaling solution, it's going to come from somewhere else.

stephenbez 9y ago
FWIW, the block size of Bitcoin Cash is 8MB not 2MB: https://www.bitcoincash.org/ https://www.bitcoincash.org/ "As a first step, the blocksize limit has been made adjustable, with an increased default of 8MB. Research is underway to allow massive future increases."

rpedela 9y ago

If networks and/or computers were faster, would that increase the max throughput? Or is the max throughput fundamental to the blockchain algorithm?

eralpb 9y ago

Interesting to see this get so many upvotes & discussion. Blockchain is an agreed protocol not a god-given thing, any time we need more we can just increase the block-size. This blog post would make sense if it talked about why incrementing block-size is not feasible, which is feasible. Storage gets cheaper every year and block-size has no effect on compute power.