[KirinDave]

Bitcoin is sooooo important that everyone has devised an alternative off-chain protocol that actually does peer-to-peer scaling and in no way actually needs bitcoin except as a reconciliation strategy.

Yeah wow, we're all impressed.

[zodiac]

What's wrong with off-chain scaling?

[KirinDave]

Nothing, unless you have an agenda to make the blockchain relevant. I don't, so I do all my scaling off-chain.

[zodiac]

I'm confused by this, as well as by your parent comment. Could you make your claims more directly so I can understand them?

[KirinDave]

What's the point of having a chain at all? It's not a unqiue or prigiledged BFT solution. It has some nice but not essential properties.

If you end up scaling off-chain, then one asks why you have the PoW chain and it's phenomenal cost at all.

[zodiac]

> What's the point of having a chain at all?

Different people answer differently, but many would give censorship-resistant currency as a use case. My personal answer is more complicated.

> If you end up scaling off-chain, then one asks why you have the PoW chain

Let me generalise slightly to include PoS, which I greatly prefer but which is also pretty expensive, and suffers from the same fundamental inefficiency problems. Obviously, you need on chain consensus and guarantees so that the payoff matrix for the offchain game is setup correctly so that honest behaviour in the offchain game is a Nash equilibrium. So that when I "pay" you some money in a payment channel you really have received it in a certain sense, and offchain payments are basically as secure as on chain ones.

[KirinDave]

> Different people answer differently, but many would give censorship-resistant currency as a use case. My personal answer is more complicated.

Nothing about blockchains prevents censorship.

> Let me generalise slightly to include PoS, which I greatly prefer but which is also pretty expensive, and suffers from the same fundamental inefficiency problems.

Most literature I've read suggests potentially a hundredfold increase in throughput with Proof of Stake when executed correctly.

The only fundamental inefficiency problem PoS shares, by my reading, is the broadcast mode limitation where every node needs the full chain to be broadcast before it can move forward. However, PoW systems are nowhere near that rate limit.

I'm certainly happy to be shown this is wrong. Got resources?

> Obviously, you need on chain consensus and guarantees so that the payoff matrix for the offchain game is setup correctly so that honest behaviour in the offchain game is a Nash equilibrium.

You're right, the offchain game needs to be set up so that honest behavior is the optimal behavior. But this is where the cart is firmly planted in front of the horse. What you need is not a blockchain, what you need is trust that controls are in place to resolve a dispute equitably. The blockchain is a methodology not for eschewing trust, but contracting it out in a novel way. A blockchain, folks with guns, an escrow service with a good API, international banking: they all serve the same purpose here.

We should use these tools when they serve us. But what I've seen is that for an actual daily-use currency all that's going to happen is a million little token vendors which can negotiate lightning channels to one another will show up and we'll just have new banks that are like the old banks, but with the threat of a chain resolution which may or may not occur. The practical outcome will be indistinguishable from a healthy banking system, won't actually stop fraud, will be subject to the exact same controls that other physically rooted banks are subject to, and also be a lot more confusing.

I think lightning is solid; in that it will work. I also think it reduces a play at fundamentally restructuring commerce into a flashy buzzword pitch to reshuffle the existing players on the board somewhat.

Having been deeply in the (somewhat broken) American banking system, I can tell you that the system desperately needs to be reworked from the ground up and that can only happen with a truly distributed, truly transparent (an often undersold or ignored aspect of Bitcoin but a truly phenomenal property), truly and fundamentally new way of performing commerce.

We don't have that.