[zallarak]

Clarifications (this comment perpetuates some common misconceptions):

- A single bitcoin "transaction" can actually have thousands of inputs and thousands of outputs. So energy "per transaction" or "transactions per second" is not analogous to a typical monetary transaction.

- Bitcoin does not compete with literal credit card transactions (although some use it like that today). I'd compare Bitcoin on-chain transactions with how nation-states settle their central-bank ledgers with gold. Gold is the best comparison to Bitcoin because trading in hard gold is "final". Credit card transactions happen on a higher level in the financial stack. As does cash. As do bank transfers. All of these bubble down into interbank transfers that eventually settle on the base layer of central banks. So compared to shipping and securing gold, Bitcoin is quite cheap!

* Pasted and modified from an earlier comment I made on HN.

[sfjailbird]

> Bitcoin does not compete with literal credit card transactions

That's, like, just your opinion. For a lot of people it competes just fine.

> Credit card transactions happen on a higher level in the financial stack. As does cash

How so? As far as settlement is concerned, a cash transaction is pretty much exactly like a bitcoin transaction (and quite unlike a credit card transaction).

[bduerst]

>That's, like, just your opinion. For a lot of people it competes just fine.

Until it doesn't. A payment network is graded on how it handles disputes, not regular transactions. Bitcoin can't do refunds or chargebacks, making it rife for fraud.

Sure, you can implement escrow, but then it's no longer competitive like GP said.

[kain_niak]

Still limited to 1 000 000 bytes per 10 minutes and then some for segwit which was a unnecessary hack job that actually makes blocks bigger without much added throughput.

[nullc]

That isn't true.

In Bitcoin the block size limit was eliminated and replaced with a block weight limit which better reflects the long term operating costs for node. The raw 'size' of transactions inherently is becoming less meaningful in the long term with things like transaction compression and compact encodings.

The weight limit doesn't map perfectly to any size limit because its limiting different things, this evening most blocks have been about 1.3 MB.

[BigBubbler]

Probably technically true, but, it is just a part of the dishonest language-shell-game to fool people into thinking BTC can really scale to become a real peer-to-peer electronic cash for the world's people. 1.3 MB is still tiny! Pretending a small difference matters is so disingenuous.

[nullc]

Blocksize is a rate.

If you were traveling at 120 MPH and then accelerated to 156 MPH you would not say that this was a small difference without consequences.

It mattered significantly, in several respects. E.g. https://bitinfocharts.com/comparison/bitcoin-transactionfees...

[j23450n]

Blocksize is clearly not literally a rate; that's a ridiculous statement. When you artificially cap it, like putting a limiter on your car in your analogy, it can be rate limiting, i.e. limiting the transaction rate - an actual rate. That chart you posted in meaningless in this context, but clearly just greg being greg, trying to manipulate; are you seriously trying to suggest that the tiny increase from segwit shenanigans is responsible for that (cropped) decrease in tx fees? That's demonic.

[nullc]

It is literally a rate. It is the rate of bytes added per block (which by the system's design is once per ~10 minutes).

Increasing supply above demand radically drops fee rates. That is the logical, predicted, and observed behavior-- both in Bitcoin and in other similar systems.

[mathiasrw]

> Bitcoin does not compete with literal credit card transactions

Why not?

[ra5]

From a slightly more nerdy perspective:

Because these credit card companies have thousands of _their_ machines, in _their_ locations, running _their_ software, to meet _their_ standards.

Meanwhile, Bitcoin is run god knows where, for god knows who (as rightfully intended of course), on god knows what software.

Sadly speed is just naturally part of the tradeoff in this scenario.

[kain_niak]

Yes this is true because Bitcoin core plays by the speed of the weakest link.

It's not true for Bitcoin Cash which plays by the "if your node is not making you money why are you running it"

When we upgrade every 6 months or useless nodes just get stuck on the old chain forever and that's it.

Last upgrade there was one miner who upgraded one block to late and lost about 1000 USD. That miner will be the first to run the new software in may.

We had a hacker who got a smart card to get Bitcoin cash to work like a credit card without needing to be online.

Bitcoin cash tx are instant and take on average about 2 seconds to spread to about 1999 out of 2000 mempools.

They settle on the chain on average 10 minutes.

Credit card tx also take a couple of seconds but much longer to settle.

Right now BCH can not yet scale like Visa but we already have the capacity to compete with paypall.

Satoshi's design works at scale but only when you don't delete point 6 from the whitepaper which is "Simple Payment Verification"

Core tries to make you belief the whitepaper was written without points 6 and 7.

7 is how to make the blockchain smaller by pruning it using merkle trees.

Nobody does that yet because storing 200 GB for 10 years is super cheap.

But 6 and 7 are ESSENTIAL in the design to scale.

Core completely ignores them or says: Well SPV is not 100% secure there for it's insecure and should not be used.

Gmax does this with everything, he flips it to extremes.

Meanwhile right now on LN there is couple of hundred thousand dollars that is very easy to steal from non technical people.

1) you find people that want to open a channel with you. These people go online to post their ip addresses and open ports on /r/bitcoin. These posts are encouraged on /r/bitcoin.

2) You open a channel with them for like 100 USD in BTC.

3) You push the balance to their side of the channel by using a swap side that accepts both LN and other coins.

4) You sell this 100 USD for another coin.

5) You publish an old state.

6) You do this to nodes you monitor using nmap to see if they go offline on a regular basis for longer then nlocktime.

7) You can't lose money on this, only win with people that should not be running LN but are.

There is like 6 million USD locked up in LN and about 10% is for grabs.

8) The victims have nowhere to go because if they post about it on their channels they get called stupid and banned and their post deleted.

9) People are already doing this but the victims are still not speaking out. They just belief it was their own fault and move on. Meanwhile the watchtower software is not there yet and if a node does not go offline for nlocktime you can easily DDOS that node for 144 blocks and you doubled your money.

[nemild]

Compared to credit cards:

- Bitcoin doesn't have chargebacks

- Bitcoin's base protocol transaction throughput is low

- There is a fixed cost per transaction (credit cards have low marginal costs for the credit card processor, and variable, percentage-based fees)

[Nursie]

There is an uncorrelated cost for every transaction, it's not exactly fixed.

[__s]

Credit card transactions are not immutable. This is a feature

You could build that feature on top of bitcoin, but it isn't a feature that should be built into bitcoin transactions. See the lightning network