[sarahj]

I remember reading about Bitcoin a couple of years ago and expressing disbelief that many of the major advantages being heralded were little more than fantasy, these were:

* Micro-transactions.

* Replacing practically everything related to money in developing countries.

From this thread it is clear that many of those dreams are still very much dreams - the ever growing energy and resource requirements to participate significantly in the network is staggering, the amount of storage required for the blockchain is a burden to even tech-aware users (unless of course one would want to trust a third party...), and now it would seem that there are minimum bandwidth requirements which sit outside what is possible in even modest parts of the USA - impossible to achieve in places where the main link to the internet is a satellite.

If I was feeling particularly optimistic I would say that Bitcoin has been shown to be unscalable in it's current form. Further, the network itself tends towards centralization because of the ever growing storage, processing and bandwidth requirements.

I look forward to seeing where the future of crypocurrencies leads us- there is so much promise.

[brighton36]

You wouldn't believe how clunky the Internet was when it first started. This stress test is fairly minor compared to the problems bitcoin had in 2011 and 2012. With time, the blockchain will improve. Just like the Internet. You should look into the Lightning Network paper, there's no shortages of solutions in bitcoin. Meanwhile, traditional financial platforms have been stagnant for decades.

[aliakhtar]

In 2000, about 5-6 years after the internet was easily available to public, I had a dial up connection, email, IM, a web browser, etc in the middle-of-nowhere town in Pakistan where I was born. Bitcoin has been out for close to 6-7 years and does not even come close to the maturity / adoption of internet.

[AnonNo15]

Except Internet was in development since 1969 by the time it became available to public.

Bitcoin whitepaper was released in 2008. Before that even the concept of cryptocurrency hardly existed.

[aliakhtar]

The technologies used in Bitcoin have also been in development for several decades, and by 1998 the first cryptocurrency was already released, according to a quick search on wikipedia.

[AnonNo15]

Note the difference - "technologies used in Bitcoin were in development for X years" vs. "Internet as a whole concept of network of network was in development for Y years".

[aliakhtar]

No, the internet as we perceive it today, as a global network, didn't exist back in 1969. The technologies we use in internet today were developed back then, though. Just like they were for bitcoin (cryptography, merkle trees, etc)

[colordrops]

The technologies used for both bitcoin the internet have been in development for thousands of years.

[dragonwriter]

> Bitcoin whitepaper was released in 2008. Before that even the concept of cryptocurrency hardly existed.

Digital currency was, as I understand, the application usually highlighted for secure (cryptography-based) distributed capability-based computing, as typified by the E programming language in 1997. Not sure if there are precedents going back further or not.

[Mtinie]

While that's a reasonably valid assertion of the state of Bitcoin's protocol development compared against the state of the collection of protocols and services we call the "Internet", I believe that they are similar but not completely relatable.

For the vast majority of people in the World the advent of the Internet was a completely ground-breaking, and completely original, idea. The predecessor technologies that provided similar utility for people (such as phone, fax, radio, television, libraries, social clubs, lunch meetings, etc.) were functions that didn't have a cohesive string that tied them all together and put them in one place. The Internet served that need by providing lots of perceived benefits to people; wide-spread adoption rapidly followed.

On the other hand, Bitcoin has a very specific utility right now -- it facilitates the transfer of value quickly and at (relative) low cost in a (reasonably) anonymous fashion without oversight.

While a significant number of people all around the World use the banking system, I'd wager that if you asked if their banks and investment accounts "worked well enough" that you'd hear a majority say that they do (and then you'd hear all of the caveats of what doesn't work and what they hate about it -- but not enough to seek out alternatives yet).

Bitcoin is still looking for it's toe-hold to convert that mostly satisfied majority. I believe it (or another blockchain-based technology) will find it, and sooner than later, but I am not blinded to the fact that it could end up being viewed in history as simply an interesting experiment that ultimately was ahead of its time.

[aliakhtar]

I'm not the one who said bitcoin was like the internet. Someone else did, I was responding to them.

[kaoD]

The internet got better as time went by. The blockchain is getting worse.

[colordrops]

I've seen this argument several times. The flaw with it though is that it confuses growing resource needs with centralization. Even if a large percentage of people are no longer capable of easily hosting a full node, the benefits of decentralization are there. The resources required are not insane, so "normal" people (read: not power elite) are capable of running a node, and so there is still enough decentralization so that no entity can corrupt the blockchain. Besides that, the rate of transaction growth is slower than growth in bandwidth and disk space costs, so things will likely get better.

[juliangregorian]

> Even if a large percentage of people are no longer capable of easily hosting a full node, the benefits of decentralization are there.

How exactly? If you don't host a full node, you can only participate by going through someone who does.

> The resources required are not insane, so "normal" people (read: not power elite) are capable of running a node

The resources are formidable, and those in developing economies (except for the "power elite") have no hope of running a node.

> there is still enough decentralization so that no entity can corrupt the blockchain

Except that mining syndicates control huge swaths of the blockchain and it would only take the collusion of a few to control an absolute majority.

> the rate of transaction growth is slower than growth in bandwidth and disk space costs, so things will likely get better

Please explain the math on this. My understanding of network effects means that the problem will probably only get worse.

[davidgerard]

> The flaw with it though is that it confuses growing resource needs with centralization.

And yet, we observe centralisation.

[colordrops]

When the term centralization is used, it refers to the idea that a single entity can control or damage a system through a single (central) point. How is that the case with bitcoin?

[davidgerard]

Er, no, it means a thing is centralising (which is observably the case). The word doesn't just refer to the limit case of a single entity.

And we have in fact had the single entity case, when GHash went over 51% (and had successfully conducted a 49% attack already), as you already know.