3 ms·

In defense of Bitcoin, it would have taken a decade to process the $40 billion of withdrawals from SVB on the blockchain, so a bank run couldn't have happened.

kragen 4y ago
hmm, i saw somewhere that svb had some 37000 depositors there's no relevant limit to the amount of money in a bitcoin transaction, so this could have been one transaction with 37000 outputs, or 37000 transactions one output, or 370 transactions with 100 outputs, or whatever the latest block in the bitcoin blockchain is block 780'537 https://www.blockchain.com/explorer/blocks/btc/780537 https://www.blockchain.com/explorer/blocks/btc/780537 containing 1788 transactions, totaling 4489.31 bitcoin, which is currently about 98 million dollars; the block weighs 1847 kilobytes most of these transactions had 2 outputs, though many had more (7, 8, 9, 20) and a few had only 1. if we estimate this block as containing 3700 outputs we wouldn't be far wrong. in that case it would take 10 blocks (a little under two hours) to process all 37000 withdrawals processing 200 billion dollars of transactions at the rate that money was being transferred in this block would take 2000 blocks, almost two weeks, because the average transaction size in this block was much smaller than svb's average account size; this is still less than a decade consider transaction a400f39693ab997c162156a09599557b26c7a6d1efa711c49f4ccf5b12505b66 https://btcscan.org/tx/a400f39693ab997c162156a09599557b26c7a6d1efa711c49f4ccf5b12505b66 https://btcscan.org/tx/a400f39693ab997c162156a09599557b26c7a... with 21 outputs. this transaction is 837 bytes, so it's a little smaller than average for this block despite its large number of outputs; an 1837-kilobyte block consisting only of such transactions would contain 2206 transactions, paying out to 46326 different addresses so in fact the bitcoin blockchain could have processed all of svb's withdrawals in a single block the price of bitcoin would have to go up quite a bit for that to happen; bitcoin's market cap is currently only 389 billion dollars, so this one piddly bank would have been more than half of it, and transferring such a large amount of bitcoin around at once would likely freak people out enough to blow the whole system up but there's no technical reason in the bitcoin blockchain that dissolving such a bank would be impossible or even difficult there have been any number of bank runs in bitcoin already, unfortunately

kragen 4y ago

hmm, i saw somewhere that svb had some 37000 depositors there's no relevant limit to the amount of money in a bitcoin transaction, so this could have been one transaction with 37000 outputs, or 37000 transactions one output, or 370 transactions with 100 outputs, or whatever the latest block in the bitcoin blockchain is block 780'537 https://www.blockchain.com/explorer/blocks/btc/780537 https://www.blockchain.com/explorer/blocks/btc/780537 containing 1788 transactions, totaling 4489.31 bitcoin, which is currently about 98 million dollars; the block weighs 1847 kilobytes most of these transactions had 2 outputs, though many had more (7, 8, 9, 20) and a few had only 1. if we estimate this block as containing 3700 outputs we wouldn't be far wrong. in that case it would take 10 blocks (a little under two hours) to process all 37000 withdrawals processing 200 billion dollars of transactions at the rate that money was being transferred in this block would take 2000 blocks, almost two weeks, because the average transaction size in this block was much smaller than svb's average account size; this is still less than a decade consider transaction a400f39693ab997c162156a09599557b26c7a6d1efa711c49f4ccf5b12505b66 https://btcscan.org/tx/a400f39693ab997c162156a09599557b26c7a6d1efa711c49f4ccf5b12505b66 https://btcscan.org/tx/a400f39693ab997c162156a09599557b26c7a... with 21 outputs. this transaction is 837 bytes, so it's a little smaller than average for this block despite its large number of outputs; an 1837-kilobyte block consisting only of such transactions would contain 2206 transactions, paying out to 46326 different addresses so in fact the bitcoin blockchain could have processed all of svb's withdrawals in a single block the price of bitcoin would have to go up quite a bit for that to happen; bitcoin's market cap is currently only 389 billion dollars, so this one piddly bank would have been more than half of it, and transferring such a large amount of bitcoin around at once would likely freak people out enough to blow the whole system up but there's no technical reason in the bitcoin blockchain that dissolving such a bank would be impossible or even difficult there have been any number of bank runs in bitcoin already, unfortunately