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> About 9.1 million bitcoins, representing about 51% of those outstanding, haven’t changed hands in at least six months, according to Flipside. About two millio

by aazaa 7y ago

> About 9.1 million bitcoins, representing about 51% of those outstanding, haven’t changed hands in at least six months, according to Flipside. About two million of those bitcoin haven’t moved in more than two years. Transaction volume has always been a difficult metric. For one thing, most transactions are likely to happen off-chain. That can occur in a centralized system like Coinbase. This has always been a possibility dating back to the first exchanges like Mt. Gox. More recently, Lightning Network means that decentralized off-chain transactions can play a bigger role in Bitcoin's total transaction volume. Lightning involves two parties setting up a contract (Bitcoin has supported them from day one). This contract defines rules that allow the parties to update a private transaction (without counterparty risk) until settlement on the block chain is required. At that point a transaction is published. That transaction may represent one, a handful, or hundreds of thousands of intermediate transactions. There aren't very good ways to determine how many, and this will tend to make Bitcoin's transaction volume ever more opaque over time. Exchanges are starting to support Lightning as a method to move bitcoin in and out. Second, absolute transaction count doesn't take coin value or age into account. For example, I can just flip the same 0.001 BTC back and forth to myself rapidly. That would add many transactions but wouldn't reveal much of value. An alternative metric is "bitcoin days destroyed" (BDD). BDD equals the value of the coin being spent multiplied by its age in days, summed over all transactions in a given period: https://bitcoin.stackexchange.com/questions/845/what-are-bitcoin-days-destroyed/847#847 https://bitcoin.stackexchange.com/questions/845/what-are-bit... When BDD spikes you know that either old coins are being spent or that lots value in younger coins is being spent. That metric might be more economically valuable. There's a realtime chart here: https://blockchair.com/bitcoin/charts/coindays-destroyed?interval=full https://blockchair.com/bitcoin/charts/coindays-destroyed?int...

globuous 7y ago
Nice ! Its been a while ive been out of the game, handnt heard of lightning in a while ! I tried googling some stats, but its always hard to get grasp at them. I dont have the knowledge to understand how much shares each participant represents. Could you hand me some refs i you have to better understand How lightning is used currently please ? If you have any ? Cheers :)
deleted 7y ago
[deleted]
bduerst 7y ago
Lightning network comes up just about every discussion involving bitcoin transactions, but because it requires the bitcoin network to make confirmations, Lightning only scales with the number of transactions, not users. This is still a problem. Example of the problem: * For 2 users to make 10,000,000 transactions between each other, it would take 10 minutes on the lightning network. * For 10,000,000 users to make just 2 transactions between each other, it would take 46 days on the lightning network. This means that if the entire state of Georgia used Lightning Network as a payment system, people wouldn't even be able to pay their monthly rent on time. Lightning Network is an over-engineered solution to a Bitcoin problem, which is why nobody is seriously adopting it.
- pouta 7y ago
  Where can I read more about how you came up with those numbers? I didn't knew that side of lightning.
  - deleted 7y ago
    [deleted]
  - bduerst 7y ago
    It's napkin math based on the Bitcoin network's hard limitations of 4-7 transactions/second, so assuming 5 tx/s, then there's 432K transactions/day limit. Since lightning requires Bitcoin to settle transactions between parties, it means that the more users there are making transactions, the more it needs bitcoin. If it's just a handful of users making a million transactions, then there's no problem since lightning will do the math and then settle on Bitcoin with a handful of transactions. If there's a million users making a handful of transactions, well, then lightning needs to settle a few million transactions on Bitcoin (which takes weeks).
    - Acrobatic_Road 7y ago
      > If there's a million users making a handful of transactions, well, then lightning needs to settle a few million transactions on Bitcoin (which takes weeks). Sorry, but you seem to be entirely ignorant of how lightning works. Lightning does not need to settle transactions on Bitcoin. If I pay someone using lightning then that payment is as good as good. The person who received the funds could go on and pay someone further. Notice there was no need to make an on-chain settlement transaction for this to work.

by aazaa 7y ago

globuous 7y ago

Nice ! Its been a while ive been out of the game, handnt heard of lightning in a while ! I tried googling some stats, but its always hard to get grasp at them. I dont have the knowledge to understand how much shares each participant represents. Could you hand me some refs i you have to better understand How lightning is used currently please ? If you have any ? Cheers :)

deleted 7y ago

[deleted]

bduerst 7y ago

Lightning network comes up just about every discussion involving bitcoin transactions, but because it requires the bitcoin network to make confirmations, Lightning only scales with the number of transactions, not users. This is still a problem. Example of the problem: * For 2 users to make 10,000,000 transactions between each other, it would take 10 minutes on the lightning network. * For 10,000,000 users to make just 2 transactions between each other, it would take 46 days on the lightning network. This means that if the entire state of Georgia used Lightning Network as a payment system, people wouldn't even be able to pay their monthly rent on time. Lightning Network is an over-engineered solution to a Bitcoin problem, which is why nobody is seriously adopting it.

pouta 7y ago
Where can I read more about how you came up with those numbers? I didn't knew that side of lightning.
- deleted 7y ago
  [deleted]
- bduerst 7y ago
  It's napkin math based on the Bitcoin network's hard limitations of 4-7 transactions/second, so assuming 5 tx/s, then there's 432K transactions/day limit. Since lightning requires Bitcoin to settle transactions between parties, it means that the more users there are making transactions, the more it needs bitcoin. If it's just a handful of users making a million transactions, then there's no problem since lightning will do the math and then settle on Bitcoin with a handful of transactions. If there's a million users making a handful of transactions, well, then lightning needs to settle a few million transactions on Bitcoin (which takes weeks).
  - Acrobatic_Road 7y ago
    > If there's a million users making a handful of transactions, well, then lightning needs to settle a few million transactions on Bitcoin (which takes weeks). Sorry, but you seem to be entirely ignorant of how lightning works. Lightning does not need to settle transactions on Bitcoin. If I pay someone using lightning then that payment is as good as good. The person who received the funds could go on and pay someone further. Notice there was no need to make an on-chain settlement transaction for this to work.