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Unfortunately, Bitcoin as designed is technically incapable of being in widespread use for payment, due to a severe lack of network capacity, and a complete lac

Unfortunately, Bitcoin as designed is technically incapable of being in widespread use for payment, due to a severe lack of network capacity, and a complete lack of interest in ever changing this. Instead, all effort is going into a building a flawed second layer that is theoretically unsound and a usability nightmare.

repomies691 7y ago
> Instead, all effort is going into a building a flawed second layer that is theoretically unsound and a usability nightmare. I don't know much about LN and actually I'm quite sceptical about it. However I have tried it now couple of times with different wallets and it seems to work very fluently from user perspective. And saying this as a very old bitcoin user, so I'm used to sending bitcoin payments a lot, LN payments don't seem to differ that much from usability perspective. You scan the QR code/invoice and press send.
- arcticbull 7y ago
  LN requires an on-chain transaction to open a channel and another to close a channel which means it'll take 70 years to open a channel for everyone on earth and then close it once, assuming the blockchain does nothing else. If an intermediate node loses power all your channel money is locked for over 48 hours. It's also not even Bitcoin and could work just as well with any other cryptocurrency or probably even dollars honestly. Then of course there's the features people actually want like dispute resolution, the ability to charge back, and so on.
  - xorcist 7y ago
    Is the argument here that Lightning, or Bitcoin, is useless because everyone on earth can not use it at the same time? Isn't that moving the goalposts, even a little? Even if only a couple of thousand people could use it, as long as it is useful to them it has a niche. It might not be enough to justify insane valuations, of course, but that's another discussion entirely.
    - mamon 7y ago
      Traditional banking serves pretty much everyone on earth, without running into performance issues, so if Bitcoin is going to replace those banks then yes, it must do the same. And it was Bitcoin fanboys who declared that Bitcoin is here to replace fiat money, so you set that goalpost yourself.
      - girvo 7y ago
        I think you'd be surprised by how large a proportion of the human population doesn't use traditional banking
      - alwillis 7y ago
        No. Traditional banking doesn’t even serve everyone in the United States, with 55 million people unbanked or underbanked: https://en.wikipedia.org/wiki/Unbanked https://en.wikipedia.org/wiki/Unbanked
        deleted 7y ago
        [deleted]
        arcticbull 7y ago
        This is the biggest misconception in the space (and that's saying a lot). They're un-banked and under-banked because they don't have money, not because the services don't exist. You want to solve this problem, solve wealth inequality and income inequality, don't pretend magic beans that cost $1-3 to transact will solve the problem for you. That's more than it costs you to use an Amex Bluebird or even a Green Dot card at an ATM, let alone a T-Mobile prepaid visa. And it's dropped half its value in the last two years (generously). Those are the people you want to disadvantage with a massively fluctuating currency? Not to mention the low-income folks are most likely to have smartphones and therefore access to online banking with Ally or Schwab, which require $0 minimum balances and refund all ATM fees. You need a phone to use BTC, which means those same people can access Ally or Schwab and be objectively better off. This is again a social problem in need of a social solution. Postal banking is a great way to solve the access problem where it exists, too, like is done in the UK, and was in the US until the 1970s. Sorry, this talking point is debunked, unless there's something I'm missing here.
  - RustyRussell 7y ago
    Your figures are about right, but 70 years is a long time to assume nothing else changes. As to "it's not even bitcoin" you're flat wrong. Holding a valid Bitcoin transaction is definitely Bitcoin, and with Lightning you always do. This is why it can't be done without bitcoin. And from a FOSS development perspective, bitcoin is the only project in the *cryptos" space I consider serious. I wouldn't base a project of mine on any of the other chains, and I think I've earned my graybeard enough in FOSS to make that judgement. [Disclaimer, I work on Lightning standards and one implementation, since 2015]
  - alwillis 7y ago
    There's a lot of FUD here. It's kind of a straw man to talk about opening LN channels for 7.5 billion people, as if that's something to be concerned about today. Not every man, woman and child has a cell phone or computer right now, so that's not really a concern in 2019. Dispute resolution is built into the protocol: it's a two-way channel; both parties have to agree that the transaction in question took place and either party can close the channel if they wish. And because LN is under heavy development, there are all kinds of new features being developed, like watchtowers that can monitor the channel on your behalf, etc. You don't need chargeback if you can claim your money and close the channel if thing you want to happen isn't happening, right? Yes, other cryptocurrencies (such as Ethereum) can create LN as a layer-2 feature. No, you can't do this with dollars; since there's no cryptocurrency representation of USD with the required blockchain and scripting/smart contracts language required for LN—at least not yet.
    - arcticbull 7y ago
      > You don't need chargeback if you can claim your money and close the channel if thing you want to happen isn't happening, right? And if the other person disagrees? Crypto falls down at the boundary between humans and the Blockchain every time.
  - alwillis 7y ago
    There are over 10,000 LN nodes right now, with a capacity of nearly $8 million and growing quickly. The site is called “1ML” because the goal is to get to 1 millions LN nodes: https://1ml.com https://1ml.com You have nodes running on smartphones now; as soon as you launch a LN app, the channel is opened. There are billions of smartphones out there, so the 70 years you quoted is not a thing.
askmike 7y ago
The idea here is that the blockchain model where everyone checks everything that happens doesn't scale to billions of users. Fortunately for people who disagree, there are hundreds of crypto projects that think this is possible. Including straight up copies of Bitcoin like Bitcoin Cash and Bitcoin SV.
- DagAgren 7y ago
  It doesn't even scale to millions of users. And basically every project that tries to claim different is just ignoring the problem and trying to pump their own price. Everything in cryptocurrencies is a scam.
  - icelancer 7y ago
    This is absurd hyperbole. There are people working on legitimate answers to your concerns, such as the Lightning Network and other initiatives.
    - jcranmer 7y ago
      Is Lightning usable yet? I recall hearing it's been "imminent" since at least 2017...
      - askmike 7y ago
        You're clearly listening to the wrong people. It's usable for sure, but that doesn't mean billions of people can (nor want) to use it now. I'm using it just fine.
        ppf 7y ago
        It's less usable than it's parent blockchain!
        askmike 7y ago
        That's subjective. It's a lot cheaper and fast to send money.
mraudiobook_com 7y ago
and a complete lack of interest in ever changing this. Excuse me, Bitcoin Cash?
cft 7y ago
That's not an issue at all, for large transactions. The real issue is each payment being a taxable event, due to IRS treating it as property, rather than currency. You literally have to report each payment on schedule D and calculate its cost basis! This burden kills any legal US adoption.
- marcus_holmes 7y ago
  I thought the Bitcoin community were publicly stating that Bitcoin is optimised as a "Store of value" rather than a currency to be used for transactions? Which is it?
  - blotter_paper 7y ago
    It's properties are more in line with a store of value, especially the deflationary aspect, but the line between a store of value and a currency is blurry. Gold also has more properties of a store of value than a currency, and it's used more as a store of value globally, yet some parts of North Africa and the Middle East are using the gold dinar as a currency. It can be both.
    - marcus_holmes 7y ago
      not in a modern tax regime, not really. If it's a store of value, like say bonds, then it's property. You have to report gold transactions, too, after all.
      - blotter_paper 7y ago
        If you wanted to know how it's taxed, you could've asked that directly. I didn't see anything in your question about how it was taxed. Short answer specific to the US (IANAL): capital gains on every transaction, counting transactions between different cryptocurrencies as if you'd sold your original currency for USD and then bought the other cryptocurrency using USD. These are just arbitrary laws though, they have nothing to do with the actual properties of a given cryptocurrency.
StavrosK 7y ago
Eh, there's Stellar, Nano, whatever. There are solutions, the important thing is that cryptocurrencies start having uses other than speculation. It doesn't matter which one is useful as long as one is, and I'd rather use Bitcoin now than use Visa because of a theoretical fear that Bitcoin might not scale to millions of people.
- Proven 7y ago
  > Eh, there's Stellar, Nano, whatever. Exactly. That's why only 0.001% people chose to hang onto cryptocurencies - no scarcity whatsoever...
- DagAgren 7y ago
  And they are all an absolute shitshow. Nano especially is complete and utter garbage that barely holds together under the minimal usage of its tiny user base.
  - StavrosK 7y ago
    In what way?
alwillis 7y ago
Every LN app I’ve used—DropBit, Zap, Bottle Pay, BlueWallet—has totally nailed user experience. LN will be the standard for micropayments in a year or two.

repomies691 7y ago

> Instead, all effort is going into a building a flawed second layer that is theoretically unsound and a usability nightmare. I don't know much about LN and actually I'm quite sceptical about it. However I have tried it now couple of times with different wallets and it seems to work very fluently from user perspective. And saying this as a very old bitcoin user, so I'm used to sending bitcoin payments a lot, LN payments don't seem to differ that much from usability perspective. You scan the QR code/invoice and press send.

arcticbull 7y ago
LN requires an on-chain transaction to open a channel and another to close a channel which means it'll take 70 years to open a channel for everyone on earth and then close it once, assuming the blockchain does nothing else. If an intermediate node loses power all your channel money is locked for over 48 hours. It's also not even Bitcoin and could work just as well with any other cryptocurrency or probably even dollars honestly. Then of course there's the features people actually want like dispute resolution, the ability to charge back, and so on.
- xorcist 7y ago
  Is the argument here that Lightning, or Bitcoin, is useless because everyone on earth can not use it at the same time? Isn't that moving the goalposts, even a little? Even if only a couple of thousand people could use it, as long as it is useful to them it has a niche. It might not be enough to justify insane valuations, of course, but that's another discussion entirely.
  - mamon 7y ago
    Traditional banking serves pretty much everyone on earth, without running into performance issues, so if Bitcoin is going to replace those banks then yes, it must do the same. And it was Bitcoin fanboys who declared that Bitcoin is here to replace fiat money, so you set that goalpost yourself.
    - girvo 7y ago
      I think you'd be surprised by how large a proportion of the human population doesn't use traditional banking
    - alwillis 7y ago
      No. Traditional banking doesn’t even serve everyone in the United States, with 55 million people unbanked or underbanked: https://en.wikipedia.org/wiki/Unbanked https://en.wikipedia.org/wiki/Unbanked
      - deleted 7y ago
        [deleted]
      - arcticbull 7y ago
        This is the biggest misconception in the space (and that's saying a lot). They're un-banked and under-banked because they don't have money, not because the services don't exist. You want to solve this problem, solve wealth inequality and income inequality, don't pretend magic beans that cost $1-3 to transact will solve the problem for you. That's more than it costs you to use an Amex Bluebird or even a Green Dot card at an ATM, let alone a T-Mobile prepaid visa. And it's dropped half its value in the last two years (generously). Those are the people you want to disadvantage with a massively fluctuating currency? Not to mention the low-income folks are most likely to have smartphones and therefore access to online banking with Ally or Schwab, which require $0 minimum balances and refund all ATM fees. You need a phone to use BTC, which means those same people can access Ally or Schwab and be objectively better off. This is again a social problem in need of a social solution. Postal banking is a great way to solve the access problem where it exists, too, like is done in the UK, and was in the US until the 1970s. Sorry, this talking point is debunked, unless there's something I'm missing here.
- RustyRussell 7y ago
  Your figures are about right, but 70 years is a long time to assume nothing else changes. As to "it's not even bitcoin" you're flat wrong. Holding a valid Bitcoin transaction is definitely Bitcoin, and with Lightning you always do. This is why it can't be done without bitcoin. And from a FOSS development perspective, bitcoin is the only project in the *cryptos" space I consider serious. I wouldn't base a project of mine on any of the other chains, and I think I've earned my graybeard enough in FOSS to make that judgement. [Disclaimer, I work on Lightning standards and one implementation, since 2015]
- alwillis 7y ago
  There's a lot of FUD here. It's kind of a straw man to talk about opening LN channels for 7.5 billion people, as if that's something to be concerned about today. Not every man, woman and child has a cell phone or computer right now, so that's not really a concern in 2019. Dispute resolution is built into the protocol: it's a two-way channel; both parties have to agree that the transaction in question took place and either party can close the channel if they wish. And because LN is under heavy development, there are all kinds of new features being developed, like watchtowers that can monitor the channel on your behalf, etc. You don't need chargeback if you can claim your money and close the channel if thing you want to happen isn't happening, right? Yes, other cryptocurrencies (such as Ethereum) can create LN as a layer-2 feature. No, you can't do this with dollars; since there's no cryptocurrency representation of USD with the required blockchain and scripting/smart contracts language required for LN—at least not yet.
  - arcticbull 7y ago
    > You don't need chargeback if you can claim your money and close the channel if thing you want to happen isn't happening, right? And if the other person disagrees? Crypto falls down at the boundary between humans and the Blockchain every time.
- alwillis 7y ago
  There are over 10,000 LN nodes right now, with a capacity of nearly $8 million and growing quickly. The site is called “1ML” because the goal is to get to 1 millions LN nodes: https://1ml.com https://1ml.com You have nodes running on smartphones now; as soon as you launch a LN app, the channel is opened. There are billions of smartphones out there, so the 70 years you quoted is not a thing.

askmike 7y ago

The idea here is that the blockchain model where everyone checks everything that happens doesn't scale to billions of users. Fortunately for people who disagree, there are hundreds of crypto projects that think this is possible. Including straight up copies of Bitcoin like Bitcoin Cash and Bitcoin SV.

DagAgren 7y ago
It doesn't even scale to millions of users. And basically every project that tries to claim different is just ignoring the problem and trying to pump their own price. Everything in cryptocurrencies is a scam.
- icelancer 7y ago
  This is absurd hyperbole. There are people working on legitimate answers to your concerns, such as the Lightning Network and other initiatives.
  - jcranmer 7y ago
    Is Lightning usable yet? I recall hearing it's been "imminent" since at least 2017...
    - askmike 7y ago
      You're clearly listening to the wrong people. It's usable for sure, but that doesn't mean billions of people can (nor want) to use it now. I'm using it just fine.
      - ppf 7y ago
        It's less usable than it's parent blockchain!
        askmike 7y ago
        That's subjective. It's a lot cheaper and fast to send money.

mraudiobook_com 7y ago

and a complete lack of interest in ever changing this. Excuse me, Bitcoin Cash?

cft 7y ago

That's not an issue at all, for large transactions. The real issue is each payment being a taxable event, due to IRS treating it as property, rather than currency. You literally have to report each payment on schedule D and calculate its cost basis! This burden kills any legal US adoption.

marcus_holmes 7y ago
I thought the Bitcoin community were publicly stating that Bitcoin is optimised as a "Store of value" rather than a currency to be used for transactions? Which is it?
- blotter_paper 7y ago
  It's properties are more in line with a store of value, especially the deflationary aspect, but the line between a store of value and a currency is blurry. Gold also has more properties of a store of value than a currency, and it's used more as a store of value globally, yet some parts of North Africa and the Middle East are using the gold dinar as a currency. It can be both.
  - marcus_holmes 7y ago
    not in a modern tax regime, not really. If it's a store of value, like say bonds, then it's property. You have to report gold transactions, too, after all.
    - blotter_paper 7y ago
      If you wanted to know how it's taxed, you could've asked that directly. I didn't see anything in your question about how it was taxed. Short answer specific to the US (IANAL): capital gains on every transaction, counting transactions between different cryptocurrencies as if you'd sold your original currency for USD and then bought the other cryptocurrency using USD. These are just arbitrary laws though, they have nothing to do with the actual properties of a given cryptocurrency.

StavrosK 7y ago

Eh, there's Stellar, Nano, whatever. There are solutions, the important thing is that cryptocurrencies start having uses other than speculation. It doesn't matter which one is useful as long as one is, and I'd rather use Bitcoin now than use Visa because of a theoretical fear that Bitcoin might not scale to millions of people.

Proven 7y ago
> Eh, there's Stellar, Nano, whatever. Exactly. That's why only 0.001% people chose to hang onto cryptocurencies - no scarcity whatsoever...
DagAgren 7y ago
And they are all an absolute shitshow. Nano especially is complete and utter garbage that barely holds together under the minimal usage of its tiny user base.
- StavrosK 7y ago
  In what way?

alwillis 7y ago

Every LN app I’ve used—DropBit, Zap, Bottle Pay, BlueWallet—has totally nailed user experience. LN will be the standard for micropayments in a year or two.