5 ms·

Most Bitcoin transactions have a quite high transaction cost, and I would argue that chargebacks are an important consumer protection.

by rchowe 5y ago

tommek4077 5y ago
Only if you do your transaction on the blockchain. Most are done internally. It's like your bank is not sending someone with a suitcase full of money just because you pay your phone bill.
- jakear 5y ago
  It's strange to me how the only two options are "pay obscene transaction fees" or "just keep your crypto in a centralized exchange and hope they don't go MtGox". Is it impossible to achieve the stated benefit of being able to make quick and easy transactions and being decentralized? I spent some time researching the best low transaction fee easily accessible crypto for making a sort of crypto Patreon, but the vast vast majority of all crypto information available was folks speculating what was going to go "up", nobody seems interested in what is actually a decent form of money (cheap&easy to exchange, cheap&easy to transfer, and stable). I suppose it makes some sense from a game theoretic standpoint. If we consider the decision making entities in the game to be the massive crypto exchanges and miners, the best way they make money is by transaction fees and exchange fees, so they aren't likely to come up with a great micro-transaction and micro-exchange fee system. Oh well.
  - pphysch 5y ago
    > Is it impossible to achieve the stated benefit of being able to make quick and easy transactions and being decentralized? Yes. A transaction is a network-scale operation. It needs to be broadcast and confirmed by at least half the network. Otherwise it wouldn't be decentralized. As that network increases in size, the resources required for that operation increase proportionally. "Decentralization" is a bad meme that seems to work at small scales but its adherents refuse to zoom out and accept how technically ridiculous it is at current scales (millions/billions of people).
    - jakear 5y ago
      Why should a transaction need to be a network scale operation in a decentralized scheme? The ultimate decentralized payment mechanism is bartering, in which the transaction only includes the people making the transaction. Now, I don’t know how to translate that to the digital world, but there’s no clear reason why a decentralized network must inform the entire network of everything that happens in it.
      - pphysch 5y ago
        In this context we're referring specifically to decentralized finance, currency, etc.
        jakear 5y ago
        Sure, but still I can transact using currency in the real world without (directly) involving a central authority, announcing my transaction to the whole world, or paying any fees. I cannot do that in the digital world.
  - almostkorean 5y ago
    Here are some projects working towards addressing the issues of blockchain scalability: - Lightning network on bitcoin. Super cheap and fast transactions, makes micropayments a reality (this is what Twitter is using) - Layer 2 solutions on Ethereum. There are two optimistic rollups currently on main net (Arbitrum and Optimism). Reddit has recently committed to building on Arbitrum. There are also ZK rollups (starkware, zksync) coming in the next year or so. - Less decentralized layer 1 chains like Solana, Avalanche, BSC, Fantom It's unfortunate that people looking to enter the space have a hard time finding real and relevant info. Not sure what the solution is for fixing the information problem, but there are lots of people building real tech in the space
    - jakear 5y ago
      As I understand it these layer 2 solutions typically require a resolution transaction in order to actually extract value, which has similar costs to a normal on-chain transaction. In the ideal world folks would be able to use the existing infrastructure of established Bitcoin atms to make transactions with low fees, but that doesn’t seem like it will happen any time soon. Things like the Twitter solution aren’t great, Twitter owns all the currency and is kind enough to let you have some sometimes. If I were to make my app I wouldn’t want ownership of any of the currency, too much liability. I’m not very interested in the promises of bleeding edge crypto startups, in my experience they almost never pan out, and certainly aren’t accessible to the masses.
      - almostkorean 5y ago
        Not sure what you mean about layer 2 solutions being similar in cost to layer 1 transactions. See here: https://l2fees.info https://l2fees.info. Arbitrum and Optimism are both running in "safe mode" so their tx cost will continue to go down. I agree that the twitter solution isn't great. Just pointing out that Lightning network is a tech that can be used for cheap transactions. 100% agree that none of these solutions are accessible to the masses. Tons of UX issues, most people don't want to self custody, layer 2s can require bridging, etc. But, I don't think it's terribly hard to see how these issues will be addressed and they are actively being worked on
- faeyanpiraat 5y ago
  So it's just a different institution doing transactions internally with extra steps.
  - shawnz 5y ago
    Not exactly, the "extra steps" are necessary to create separability so that the user can have their choice of institution to deal with.
- ivalm 5y ago
  > Most are done internally You mean with one centralized authority you have to trust?
WanderPanda 5y ago
Tx cost on BTC main layer has been ~7ct for months, what are you talking about?

Most Bitcoin transactions have a quite high transaction cost, and I would argue that chargebacks are an important consumer protection.

by rchowe 5y ago

Most Bitcoin transactions have a quite high transaction cost, and I would argue that chargebacks are an important consumer protection.

tommek4077 5y ago

Only if you do your transaction on the blockchain. Most are done internally. It's like your bank is not sending someone with a suitcase full of money just because you pay your phone bill.

jakear 5y ago
It's strange to me how the only two options are "pay obscene transaction fees" or "just keep your crypto in a centralized exchange and hope they don't go MtGox". Is it impossible to achieve the stated benefit of being able to make quick and easy transactions and being decentralized? I spent some time researching the best low transaction fee easily accessible crypto for making a sort of crypto Patreon, but the vast vast majority of all crypto information available was folks speculating what was going to go "up", nobody seems interested in what is actually a decent form of money (cheap&easy to exchange, cheap&easy to transfer, and stable). I suppose it makes some sense from a game theoretic standpoint. If we consider the decision making entities in the game to be the massive crypto exchanges and miners, the best way they make money is by transaction fees and exchange fees, so they aren't likely to come up with a great micro-transaction and micro-exchange fee system. Oh well.
- pphysch 5y ago
  > Is it impossible to achieve the stated benefit of being able to make quick and easy transactions and being decentralized? Yes. A transaction is a network-scale operation. It needs to be broadcast and confirmed by at least half the network. Otherwise it wouldn't be decentralized. As that network increases in size, the resources required for that operation increase proportionally. "Decentralization" is a bad meme that seems to work at small scales but its adherents refuse to zoom out and accept how technically ridiculous it is at current scales (millions/billions of people).
  - jakear 5y ago
    Why should a transaction need to be a network scale operation in a decentralized scheme? The ultimate decentralized payment mechanism is bartering, in which the transaction only includes the people making the transaction. Now, I don’t know how to translate that to the digital world, but there’s no clear reason why a decentralized network must inform the entire network of everything that happens in it.
    - pphysch 5y ago
      In this context we're referring specifically to decentralized finance, currency, etc.
      - jakear 5y ago
        Sure, but still I can transact using currency in the real world without (directly) involving a central authority, announcing my transaction to the whole world, or paying any fees. I cannot do that in the digital world.
- almostkorean 5y ago
  Here are some projects working towards addressing the issues of blockchain scalability: - Lightning network on bitcoin. Super cheap and fast transactions, makes micropayments a reality (this is what Twitter is using) - Layer 2 solutions on Ethereum. There are two optimistic rollups currently on main net (Arbitrum and Optimism). Reddit has recently committed to building on Arbitrum. There are also ZK rollups (starkware, zksync) coming in the next year or so. - Less decentralized layer 1 chains like Solana, Avalanche, BSC, Fantom It's unfortunate that people looking to enter the space have a hard time finding real and relevant info. Not sure what the solution is for fixing the information problem, but there are lots of people building real tech in the space
  - jakear 5y ago
    As I understand it these layer 2 solutions typically require a resolution transaction in order to actually extract value, which has similar costs to a normal on-chain transaction. In the ideal world folks would be able to use the existing infrastructure of established Bitcoin atms to make transactions with low fees, but that doesn’t seem like it will happen any time soon. Things like the Twitter solution aren’t great, Twitter owns all the currency and is kind enough to let you have some sometimes. If I were to make my app I wouldn’t want ownership of any of the currency, too much liability. I’m not very interested in the promises of bleeding edge crypto startups, in my experience they almost never pan out, and certainly aren’t accessible to the masses.
    - almostkorean 5y ago
      Not sure what you mean about layer 2 solutions being similar in cost to layer 1 transactions. See here: https://l2fees.info https://l2fees.info. Arbitrum and Optimism are both running in "safe mode" so their tx cost will continue to go down. I agree that the twitter solution isn't great. Just pointing out that Lightning network is a tech that can be used for cheap transactions. 100% agree that none of these solutions are accessible to the masses. Tons of UX issues, most people don't want to self custody, layer 2s can require bridging, etc. But, I don't think it's terribly hard to see how these issues will be addressed and they are actively being worked on
faeyanpiraat 5y ago
So it's just a different institution doing transactions internally with extra steps.
- shawnz 5y ago
  Not exactly, the "extra steps" are necessary to create separability so that the user can have their choice of institution to deal with.
ivalm 5y ago
> Most are done internally You mean with one centralized authority you have to trust?

WanderPanda 5y ago

Tx cost on BTC main layer has been ~7ct for months, what are you talking about?