8 ms·

~10 minutes = a few minutes. BTC transfers are fast once you already have coins, and this is a reason why its adoption is increasing. People realize that havin

• eridius 12y ago
  > ~10 minutes = a few minutes. 10 minutes? More like an hour. 10 minutes will get you one confirmation. But that's rarely good enough. 6 confirmations is usually considered a good threshold to protect against double spending, and that means you're waiting an hour. > People realize that having BTC on hand is useful, so they start holding it. "People" have been holding it ever since BTC launched, because a lot of people see it as an investment vehicle (albeit a highly volatile one). But BTC is still too volatile for most people to want to hold onto any for any real length of time. > It is not true that BTC is far from decentralized. I don't think you understand my argument. I'm not saying that there's a central point of failure that will take down the whole bitcoin network. Heck, that's true of Stellar too, despite the more centralized nature there. What I am saying is that all of the various gateways and exchanges and bitcoin services are still effectively centralized points of failure for the various services they represent. Yes, a company can switch from Coinbase to BitPay, but they won't be able to accept BTC for however long it takes them to move all their services over. Imagine if the company only accepted BTC, that would be a disaster! Similarly, people who use exchanges are taking on the risk of the exchange going under. This is largely due to the fact that people maintain balances with the exchanges, which means the exchange has actually issued them credit, and if the exchange vanishes, the credit is worthless. In that sense it's actually very much like Stellar. In fact, it's nearly exactly like Stellar, because Stellar has both the credit, and has the decentralized trustless currency STR, the big difference is with Stellar people are expected to trade credit, and with BTC, people are expected to redeem their credit with the exchange/gateway in order to trade BTC directly. Bitcoin does allow you to operate in a completely trustless, decentralized manner where you never leave the network, never deal in any currency except BTC, don't use any online services to manage this stuff (i.e. keep your wallet on your local machine, run the full bitcoin client, etc). But most people don't do that, because it's wildly impractical.
  • cgjaro 12y ago
    "But that's rarely good enough" Yes it is. The vast majority of Bitcoin services and users wait for only 1 confirmation. Waiting for 6 confirmations is "excellent" whereas 1 confirmation is "good enough" (when was the last time we saw a Bitcoin double spend attempt? Never!). But arguing whether 1 confirmation is good enough is a moot point. Bitcoin competes with traditional international payment systems where it is common for transfers to post in 1-3 days especially across weekends or bank holidays ("post" has a specific definition, look it up). So even waiting for 6 confirmations makes Bitcoin faster than traditional systems. On the other point, true, many people rely on 1 exchange, or place their coins in 1 online wallet service, which makes them vulnerable to incidents typically affecting centralized systems. But this is not a problem inherent to Bitcoin. Not at all. This is solved by educating users, by new services (eg. hardware wallets like Trezor), and by "natural selection" (eg. people who lost coins on MtGox tend to learn their lessons, weak exchanges die, secure ones remain in use, merchants can very easily use multiple Bitcoin processors at once, etc).
    • eridius 12y ago
      > The vast majority of Bitcoin services and users wait for only 1 confirmation. They do? Before posting that comment I looked up information on transaction confirmations to check that my "1 hour" figure was correct, and the documentation I found stated that the recommendation is still to wait for 6 transactions, and that you may choose to use as little as 1 transaction for low-risk situations where e.g. you're selling cheap easily-replacable items, but that you should use more confirmations for other transactions. > So even waiting for 6 confirmations makes Bitcoin faster than traditional systems. But we're not talking about Bitcoin compared to other traditional systems. The context here is in comparison to Stellar, where conformation happens in seconds (worst case would be minutes, if there's network issues).
      • cgjaro 12y ago
        Correct, best practices and doc says to wait for 6 confirmations. But in practice, very few people do this. For example you can send bitcoins to your Coinbase wallet and sell them without even waiting for 6 confirmations. Let me explain to you why this is okay in practice. A merchant will in general send something to the customer (a seller would ship an item, Coinbase would send an ACH bank transfer, etc). But because sending the service or product to the customer takes time, this gives time to catch double spend attempts. So a merchant considers 1 confirmation as sufficient, and prepares the shipment right away, or initiates the ACH right away. But if in the next hour the 2nd-6th confirmations never come (eg. the 1st confirmation ends up in an orphaned block) then the merchant can cancel the shipment of the item, or cancel the pending ACH.