[Retric]

IMO, the core problem is if you want a global transaction system to become popular it needs to process and store ~TB / day of new transactions. Which means you quickly get into EB territory for the full database which is not something distributed systems can really handle without scaling issues.

Now if you want a system used by 0.01% of the global population then that's a very different problem, but far less useful.

[sharemywin]

unless it's really just s global settlement system for an unregulated global banking system for world trade.

[Retric]

Two points, first if you abandon the system for something else then you have to solve all the original problems again making the first system more or less useless. Second, even just 2 transactions / month * ~7 billion people is a lot of data.

PS: USD actually operate on a 3 tiered system that works well (Fed, Banks, cash) but doing the same thing in a *coin seems like just giving up.

[wyager]

Look up "Lightning Network". This is a solved problem. You can build on top of bitcoin to scale basically as large as you want, trustlessly. The software is being developed as we speak.

[Retric]

Lighting network boosts the number of transactions between two people, but you need to have 'banks' to make it efficient. And even then a minimum of 2 transactions per month * 7 billion people is still a lot of data.

https://medium.com/@jonaldfyookball/mathematical-proof-that-...

[wyager]

Yes, I'm aware of these limitations. Neither of them refute my point, which is that you can trustlessly scale bitcoin basically as much as you want. Maybe you have "banks" (highly connected nodes), but it's still trustless, unlike with real banks.

[runeks]

> Neither of them refute my point, which is that you can trustlessly scale bitcoin basically as much as you want.

This is unsupported. LN is a research project, not a production-ready payment system. It has plenty of limitations (trustlessness is a huge limitation), and the topology of the network doesn’t match that of a real economy (routes to fellow consumers are practically useless, since everyone wants to pay merchants). There’s plenty of work left before LN can scale properly, if it ever manages to (again, trustlessness for both senders and receivers is setting the bar as high as it can possibly go).

Scalability is secondondary for LN, trustlessness is primary. Due to this choice I predict difficulty in scaling sufficiently.

[devrandomguy]

I sense incoming downvotes, it would be great if we could get a link to an existing rebuttal, or something. Stomping on someone's dream just so you don't have to risk disappointment holds us all back. What are the limits of the Lightning network?

[runeks]

The challenge for the Lightning Network is cheaply routing payments from consumers to merchants. LN is optimized for anyone-to-anyone payments, while in a real economy money moves from consumer to merchant to producer to worker (consumer). LN is not optimized for this circular pattern, where many consumers pay a single merchant.

Also, everything is done via two-way payment channels in LN, which means that you need to lock X BTC in a channel in order to send it, which becomes very capital intensive for nodes close to merchants who need to lock millions of dollars worth of bitcoins to cover merchants’ monthly turnover (this is in addition to the BTC locked up by other nodes who participate in the transfer but are not directly connected to merchants). If you want to send 0.1 BTC through 10 nodes, each of these 10 nodes must have locked up 0.1 BTC on the blockchain, and you’ll pay blockchain fees if just a single channel/node in your path doesn’t have at least as much as you need to send.

A proper payment network needs two different types of nodes: senders and receivers. Using a single type of node for both doesn’t make much sense, since merchants and consumers have completely different needs. Senders need to be able to send relatively small amounts relatively frequently (a consumer making a few purchases per day), while receivers (merchants) need to redeem relatively large amounts (e.g. one week’s worth of payments) relatively rarely for bitcoins (on the blockchain).