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Bitcoin – Potential Network Disruption on July 31st

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Re: Bitcoin – Potential Network Disruption on July 31st

#271

Post by jellicle »

_red wrote: post #217
zby wrote: post #53

Earlier quoted context omitted.

It is probably not possible to solve the scaling problems on-chain - a secure decentralized consensus on a global scale cannot be fast. Currently the bitcoin protocol processes about 7 transactions per second. Doubling the speed by doubling blocks will not make it much closer to the 50K transactions per second of a system like VISA. But it is probably possible to scale the transaction system off-chain - with https://…

The 7 TPS claim is an apples-to-oranges comparison. You must remember that Bitcoin transactions are "settled" in that 7 TPS timescale, whereas VISA transactions are merely "recorded" in their 50K TPS rate. In reality, it generally takes a minimum of 15 days for your VISA transaction to "settle" with your bank account. Thereby the true TPS rate is orders of magnitude lower for VISA.

You're comparing latency to throughput. Visa intentionally has slow latency, to reduce fraud, which is a major problem with Bitcoin. Visa has excellent throughput, beating the pants off of Bitcoin, which is another major problem with Bitcoin.

Re: Bitcoin – Potential Network Disruption on July 31st

#272

Post by GenericsMotors »

nenreme wrote: post #135
matt_wulfeck wrote: post #58

> This means that any bitcoins you receive after that time may later disappear from your wallet or be a type of bitcoin that other people will not accept as payment. Can you imagine the uproar if Visa said the same thing? It would be totally unthinkable. Bitcoin can get away with this type of "disruption" because it's not really being used for anything other than a speculative vehicle.

> Can you imagine the uproar if Visa said the same thing? It would be totally unthinkable. No, that's exactly what Visa says, they call it chargeback. That's why it is hard to buy bitcoins with bank cards.

Yes, and you can dispute it, by contacting your them/your bank.

Who do I call if bitscoins just evaporate from my wallet thanks to this fork?

Re: Bitcoin – Potential Network Disruption on July 31st

#273

Post by zby »

zero_iq wrote: post #165
jpatokal wrote: post #20

Well, that's a remarkably uninformative announcement. Here's an attempt at a neutral tl;dr from a Bitcoin amateur. Bitcoin is currently suffering from significant scaling problems, which lead to high transaction fees. Numerous proposals to fix the scaling issue have been proposed, the two main camps being "increase the block size" and "muddle through by discarding less useful data" (aka Segregated Witness/SegWit). Ho…

I am rather stunned that the entire global bitcoin network, with its colossal combined computing power, and staggering electricity consumption, is only capable of sustaining 7 tps. The level of inefficiency here is mind-boggling. Surely this must be one of the least efficient, least environmentally-friendly computing ventures ever?

I can imagine a situation where the transactions are of such a big value that even the 7 transactions per second are enough to pay for the whole system sustenance. But yeah the system currently burns resources on a level comparable to gold mining (https://medium.com/@zby/proof-of-work-8d8265def194) - but it is much less useful than gold (for value store).

Re: Bitcoin – Potential Network Disruption on July 31st

#274

Post by xorcist »

hueving wrote: post #235
xorcist wrote: post #214

Earlier quoted context omitted.

Bitcoin may not scale well, but it is the capacity problems that lead to high fees. These are two different things and it is important to not conflate the two. Scalability has improved somewhat during the past two years and most developers believe it is time to increase capacity as well. The question you refer to is how to increase capacity, within the scaling constraints. I understand the ambition to be neutral in a…

Capacity is scaling from the user perspective. If it costs $5 to send $5 worth of bitcoin because of transaction congestion and it's only processing a tiny fraction of what a single US credit card network does, the entire system is not scaling, regardless of how many nodes are running it.

Users don't care about scaling at all. They care about capacity only indirectly.

Scaling is something developers care about, but in the nascent field of cryptocurrencies there probably no single solution.

It should be noted that with your credit card example, however, that credit card networks charge a percentage of the funds transferred while in the case of Bitcoin it is instead a fixed fee. Should you instead have said that it costs $5 to send $5000 it would have been equally true but sounded quite different.

That Bitcoin as it is described in the whitepaper doesn't scale to even a single US credit card network should be obvious to any reasonably informed reader. That every participant in the network store everyone else's transactions forever has its limitations. Does that mean the technology is useless? No, it means the use case is different from credit cards.

It seems possible to build payment systems on top of Bitcoin that fills those use cases, and sidechains and payment channels are research along those lines. But just as crypocurrencies were a theoretical possibility twenty years ago, one should not expect working products too soon. It's not like there is a shortage of payment solutions in the meantime. For end users, credit cards offer a negative cost, so even then we should not expect the use cases to be identical.

Re: Bitcoin – Potential Network Disruption on July 31st

#275

Post by GenericsMotors »

ar0 wrote: post #93
matt_wulfeck wrote: post #58

> This means that any bitcoins you receive after that time may later disappear from your wallet or be a type of bitcoin that other people will not accept as payment. Can you imagine the uproar if Visa said the same thing? It would be totally unthinkable. Bitcoin can get away with this type of "disruption" because it's not really being used for anything other than a speculative vehicle.

Isn't "any [money] you receive [...] may later disappear" actually pretty common with credit card chargebacks?

Chargebacks usually have some form of review/dispute process as well. What's bit-coin's process for disputing the disappearance of my wallet's contents because of this fork?

Re: Bitcoin – Potential Network Disruption on July 31st

#276

Post by ftlio »

davidgerard wrote: post #185
ftlio wrote: post #96

Earlier quoted context omitted.

That "Bitcoin is currently suffering from significant scaling problems" is the topic of debate. SegWit was not created toward the end of increasing the blocksize, it was created to fix transaction malleability along with various other improvements. That it arranges the partitioning of witness data from transaction data to sort-of not count against the block size was a bonus, especially since a lot of dubious attempts…

> That "Bitcoin is currently suffering from significant scaling problems" is the topic of debate. I find it hard to see how anyone could reasonably dispute it. Transactions were fast and cheap-to-free until mid-2015, when the blocks filled. Since then transactions have been slow and expensive.

And yet the people who maintained the protocol and scaled transaction throughput while it grew to tens of billions of dollars in value largely dispute it. If SegWit could activate without a hostile takeover, it would be much easier to demonstrate why there are no scaling issues.

A lot of ignorant people want to throw the baby out with the bath water though, so ultimately we're probably going to have two chains, one that does it the way the talent in the community says it should be done, and another that shifts responsibility around to a few scaled entities. My money is not on the latter.

Re: Bitcoin – Potential Network Disruption on July 31st

#277

Post by ftlio »

exit wrote: post #262
davidgerard wrote: post #185

Earlier quoted context omitted.

> That "Bitcoin is currently suffering from significant scaling problems" is the topic of debate. I find it hard to see how anyone could reasonably dispute it. Transactions were fast and cheap-to-free until mid-2015, when the blocks filled. Since then transactions have been slow and expensive.

this is no longer true. blocks are not filling and mempool is clearing: https://www.reddit.com/r/Bitcoin/comments/6hzw6c/010_satoshi... it looks like some faction was spamming the network with transactions to create a false sense of urgency about the need to scale.

They most definitely were. It should also be noted that most transactions already occur off-chain at exchanges.

Re: Bitcoin – Potential Network Disruption on July 31st

#278

Post by ftlio »

xorcist wrote: post #200
joosters wrote: post #166

Earlier quoted context omitted.

The 'lightning network' has been one of the promised solutions 'coming soon' for many years now. Except, no-one has solved all its problems yet. There remain difficult issues to do with routing of transactions, and some horrible money-losing behaviour if users don't stay online to protect their channels from being looted. On top of that, there's not enough space on the blockchain to allow everyone to open & close a p…

If Bitcoin took (likely more than) ten years to get to the state where we are now, it's likely that second layer solutions such as Lightning are not developed overnight.

They've been in development for a couple years now.

Re: Bitcoin – Potential Network Disruption on July 31st

#279

Post by kakarot »

GenericsMotors wrote: post #272
nenreme wrote: post #135

Earlier quoted context omitted.

> Can you imagine the uproar if Visa said the same thing? It would be totally unthinkable. No, that's exactly what Visa says, they call it chargeback. That's why it is hard to buy bitcoins with bank cards.

Yes, and you can dispute it, by contacting your them/your bank. Who do I call if bitscoins just evaporate from my wallet thanks to this fork?

Decentralized currency comes with its own strengths and weaknesses. The tech is still in its infancy. Take it or leave it.

Re: Bitcoin – Potential Network Disruption on July 31st

#280

Post by moduspol »

GenericsMotors wrote: post #270
moduspol wrote: post #211

Earlier quoted context omitted.

Visa is only a payment network. Bitcoin is both a currency and a payment network. If you as a business accept(ed) Visa payments in Zimbabwe's currency in 2008, or Venezuelan bolivars over the last few years, you absolutely can have its value disappear from you.

> you absolutely can have its value disappear from you. This is not a fair representation of what the article says. It doesn't only say that coins you've received may lose value, it says that there's no guarantee the network will recognize the contents of your wallet in the future. A more accurate analogy would be me handing you a crisp $100 bill which you place in your wallet, and tomorrow when you go to retrieve it…

I think you're misunderstanding the situation the article is describing then.

In that unlikely but possible scenario: Your wallet would have received coins on Chain A, but the majority of the network now favors Chain B and as a result is ignoring Chain A.

You still have the private key to coins and can spend them on Chain A. It's just problematic because they're on a chain fewer people value. Fewer, but not zero. They will still have some value, just less, and will be able to be sold out of band for coins on Chain B if desired.

This has already happened with Ethereum [1]. Each chain has its own exchange rate.

> Even a turd of a currency like ZWD won't materially vanish. You just have to spend it as quickly as possibly after you receive it, while it still holds value.

The ZWD's rate of inflation was at one point at 79,600,000,000% [2]. We are getting pretty abstract if we're going to debate how close that is to materially vanishing.

[1] http://www.coindesk.com/ethereum-classic-explained-blockchai... [2] https://en.wikipedia.org/wiki/Zimbabwean_dollar#Withdrawal_o...

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