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Arent stable coins just an appeal to central banks expansionary policy? Bitcoin was created as an alternative set of values and seems like cryptos killer app to

Arent stable coins just an appeal to central banks expansionary policy? Bitcoin was created as an alternative set of values and seems like cryptos killer app to me

Retric 6y ago
Bitcoin was created to solve micro transactions. https://bitcoin.org/bitcoin.pdf https://bitcoin.org/bitcoin.pdf The cost of mediation increases transaction costs, limiting the minimum practical transaction size and cutting off the possibility for small casual transactions, and there is a broader cost in the loss of ability to make non-reversible payments for non- reversible services. It’s the community that pivoted to something else. PS: Two different non reversible transactions sets up the two generals problem which bitcoin does not solve. https://en.wikipedia.org/wiki/Two_Generals%27_Problem https://en.wikipedia.org/wiki/Two_Generals%27_Problem
- 3fe9a03ccd14ca5 6y ago
  The average bitcoin transaction cost was over $1.50 last month, and it can only handle a maximum of about 7 transactions a second. Why would bitcoin be good for small transaction? https://ycharts.com/indicators/bitcoin_average_transaction_fee https://ycharts.com/indicators/bitcoin_average_transaction_f...
  - Retric 6y ago
    The theory was bitcoin would have low overhead as the only limit was machine time which should be cheap. However, an artificial transaction limit was created which creates artificial scarcity and thus high transaction fees. In theory a miner wants to have the highest number of profitable transactions possible, but we ended up with collusion to drive up prices and thus miner proffits.
    - sarakayakomzin 6y ago
      >However, an artificial transaction limit was created ? there's nothing artificial about a transaction limit. it is p2p and fault tolerant, and there's no such thing as unlimited data storage yet. this is by design.
    - 3fe9a03ccd14ca5 6y ago
      I don’t think the 7 transactions per second is artificial. In fact, I think it’s the technical maximum. https://en.m.wikipedia.org/wiki/Bitcoin_scalability_problem https://en.m.wikipedia.org/wiki/Bitcoin_scalability_problem
      - fidelramos 6y ago
        1 MB was an arbitrary value chosen by Satoshi Nakamoto to fight off spam in 2010, in no way it's a technical limit on the Bitcoin network, it's completely artificial.
  - fidelramos 6y ago
    The 7 transaction per second limit of BTC is completely artificial. It stems in the max size of blocks being capped to 1 MB. This was introduced by Satoshi Nakamoto way back in 2010 as an easy way to keep spam from flooding the blockchain. Keep in mind that back then Bitcoin was basically worthless, so one could spam the network with millions of transactions at very low costs, rendering it unusable to everybody. Satoshi introduced the 1 MB block size limit as a temporary measure meant to be easily lifted as transaction volume and Bitcoin price increased in the future [1]. However this didn't happen, Satoshi Nakamoto disappeared shortly after and his appointed successor, Gavin Andresen, was ousted from the project and his commit rights revoked in 2016. A lot of people tried to raise the blocksize, and all of them failed because the developers who took over Bitcoin Core have always refused. Given that consensus failed to raised the block size the Bitcoin ABC implementation split from BTC to create Bitcoin Cash (BCH) on August 1st, 2017. Bitcoin Cash initially supported blocks of up to 8 MB, which was later raised to 32 MB. Mainnet stress tests have proven that the network works fine with blocks of up to 20 MB, making clear that the 1 MB limit of BTC is as artificial as it sounds like. Because of the higher block size accommodating to more transactions the fees in BCH are consistently under 1 cent ($0.01), and the roadmap [2] includes features to keep fees low even as BCH price increases (fractional satoshis). I highly recommend this article [3] as the most comprehensive summary of the Bitcoin scaling debate. So the final question would be: is 32 MB blocks the best we can do? And the answer is a clear NO. There is much room for improvement and the limits are definitely much much higher. I recommend this talk by Amaury Séchet [4] and this article on Terabyte blocks by Johannes Vermorel [5] to learn more. [1] https://bitcointalk.org/index.php?topic=1347.msg15366#msg15366 https://bitcointalk.org/index.php?topic=1347.msg15366#msg153... [2] https://www.bitcoincash.org/roadmap.html https://www.bitcoincash.org/roadmap.html [3] https://medium.com/hackernoon/the-great-bitcoin-scaling-debate-a-timeline-6108081dbada https://medium.com/hackernoon/the-great-bitcoin-scaling-deba... [4] https://www.youtube.com/watch?v=Z0rplj8wSR4 https://www.youtube.com/watch?v=Z0rplj8wSR4 [5] http://blog.vermorel.com/journal/2017/12/17/terabyte-blocks-for-bitcoin-cash.html http://blog.vermorel.com/journal/2017/12/17/terabyte-blocks-...
    - tromp 6y ago
      One of the main goals of bitcoin was to be decentralized by allowing most computers to download and verify the entire history of bitcoin transactions within reasonable space and time. With a 32MB limit, that would amount to many TB of data rather than the current 250GB, and many weeks of verification instead of a few days.
shadowgovt 6y ago
The article is talking about cryptocurrencies in terms of adoption, not philosophy. By the metric of the article, if everyone adopts crypto because it makes it easier for them to trade in values pegged to fiat-backed dollars, that's still a win. Compare and contrast open source's relative success vs. whether the Four Fundamental Freedoms / GPL model itself actually succeeded. I haven't seen a metric by which BTC is considered a "killer app" (in any space other than "How can I buy things / conduct transactions my local government forbids or tightly regulates," and even that use case is falling by the wayside as the tools for LEO to datamine the blockchain for webs of criminal transaction activity have caught up...), and it's been around long enough that I think we can generally flag the BTC experiment specifically as "tried, found wanting." In this current global pandemic crisis, you'd think trust in central governments would be at an all-time low and people would be shifting their resources into BTC, and that doesn't appear to be happening at any grand scale.

Arent stable coins just an appeal to central banks expansionary policy? Bitcoin was created as an alternative set of values and seems like cryptos killer app to me

Retric 6y ago

Bitcoin was created to solve micro transactions. https://bitcoin.org/bitcoin.pdf https://bitcoin.org/bitcoin.pdf The cost of mediation increases transaction costs, limiting the minimum practical transaction size and cutting off the possibility for small casual transactions, and there is a broader cost in the loss of ability to make non-reversible payments for non- reversible services. It’s the community that pivoted to something else. PS: Two different non reversible transactions sets up the two generals problem which bitcoin does not solve. https://en.wikipedia.org/wiki/Two_Generals%27_Problem https://en.wikipedia.org/wiki/Two_Generals%27_Problem

3fe9a03ccd14ca5 6y ago
The average bitcoin transaction cost was over $1.50 last month, and it can only handle a maximum of about 7 transactions a second. Why would bitcoin be good for small transaction? https://ycharts.com/indicators/bitcoin_average_transaction_fee https://ycharts.com/indicators/bitcoin_average_transaction_f...
- Retric 6y ago
  The theory was bitcoin would have low overhead as the only limit was machine time which should be cheap. However, an artificial transaction limit was created which creates artificial scarcity and thus high transaction fees. In theory a miner wants to have the highest number of profitable transactions possible, but we ended up with collusion to drive up prices and thus miner proffits.
  - sarakayakomzin 6y ago
    >However, an artificial transaction limit was created ? there's nothing artificial about a transaction limit. it is p2p and fault tolerant, and there's no such thing as unlimited data storage yet. this is by design.
  - 3fe9a03ccd14ca5 6y ago
    I don’t think the 7 transactions per second is artificial. In fact, I think it’s the technical maximum. https://en.m.wikipedia.org/wiki/Bitcoin_scalability_problem https://en.m.wikipedia.org/wiki/Bitcoin_scalability_problem
    - fidelramos 6y ago
      1 MB was an arbitrary value chosen by Satoshi Nakamoto to fight off spam in 2010, in no way it's a technical limit on the Bitcoin network, it's completely artificial.
- fidelramos 6y ago
  The 7 transaction per second limit of BTC is completely artificial. It stems in the max size of blocks being capped to 1 MB. This was introduced by Satoshi Nakamoto way back in 2010 as an easy way to keep spam from flooding the blockchain. Keep in mind that back then Bitcoin was basically worthless, so one could spam the network with millions of transactions at very low costs, rendering it unusable to everybody. Satoshi introduced the 1 MB block size limit as a temporary measure meant to be easily lifted as transaction volume and Bitcoin price increased in the future [1]. However this didn't happen, Satoshi Nakamoto disappeared shortly after and his appointed successor, Gavin Andresen, was ousted from the project and his commit rights revoked in 2016. A lot of people tried to raise the blocksize, and all of them failed because the developers who took over Bitcoin Core have always refused. Given that consensus failed to raised the block size the Bitcoin ABC implementation split from BTC to create Bitcoin Cash (BCH) on August 1st, 2017. Bitcoin Cash initially supported blocks of up to 8 MB, which was later raised to 32 MB. Mainnet stress tests have proven that the network works fine with blocks of up to 20 MB, making clear that the 1 MB limit of BTC is as artificial as it sounds like. Because of the higher block size accommodating to more transactions the fees in BCH are consistently under 1 cent ($0.01), and the roadmap [2] includes features to keep fees low even as BCH price increases (fractional satoshis). I highly recommend this article [3] as the most comprehensive summary of the Bitcoin scaling debate. So the final question would be: is 32 MB blocks the best we can do? And the answer is a clear NO. There is much room for improvement and the limits are definitely much much higher. I recommend this talk by Amaury Séchet [4] and this article on Terabyte blocks by Johannes Vermorel [5] to learn more. [1] https://bitcointalk.org/index.php?topic=1347.msg15366#msg15366 https://bitcointalk.org/index.php?topic=1347.msg15366#msg153... [2] https://www.bitcoincash.org/roadmap.html https://www.bitcoincash.org/roadmap.html [3] https://medium.com/hackernoon/the-great-bitcoin-scaling-debate-a-timeline-6108081dbada https://medium.com/hackernoon/the-great-bitcoin-scaling-deba... [4] https://www.youtube.com/watch?v=Z0rplj8wSR4 https://www.youtube.com/watch?v=Z0rplj8wSR4 [5] http://blog.vermorel.com/journal/2017/12/17/terabyte-blocks-for-bitcoin-cash.html http://blog.vermorel.com/journal/2017/12/17/terabyte-blocks-...
  - tromp 6y ago
    One of the main goals of bitcoin was to be decentralized by allowing most computers to download and verify the entire history of bitcoin transactions within reasonable space and time. With a 32MB limit, that would amount to many TB of data rather than the current 250GB, and many weeks of verification instead of a few days.

shadowgovt 6y ago

The article is talking about cryptocurrencies in terms of adoption, not philosophy. By the metric of the article, if everyone adopts crypto because it makes it easier for them to trade in values pegged to fiat-backed dollars, that's still a win. Compare and contrast open source's relative success vs. whether the Four Fundamental Freedoms / GPL model itself actually succeeded. I haven't seen a metric by which BTC is considered a "killer app" (in any space other than "How can I buy things / conduct transactions my local government forbids or tightly regulates," and even that use case is falling by the wayside as the tools for LEO to datamine the blockchain for webs of criminal transaction activity have caught up...), and it's been around long enough that I think we can generally flag the BTC experiment specifically as "tried, found wanting." In this current global pandemic crisis, you'd think trust in central governments would be at an all-time low and people would be shifting their resources into BTC, and that doesn't appear to be happening at any grand scale.