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Goldman Sachs Report Explores Use of Bitcoin as Currency

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Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#71

Post by drieddust »

DINKDINK wrote: post #58
JohnJamesRambo wrote: post #14

Bitcoin is not remotely usable as a currency now. The fees are incredible, the confirmation times ridiculous. We need to move on to something more modern like Ethereum, Stellar Lumens, etc. immediately. Asking the current 1 mb blocksize version of Bitcoin to be a currency is like Goldman Sachs writing a report saying they want to run their website on Intel 486 processors. They mention Zimbabwe moving to it as an alte…

>The average Bitcoin fee is now $40 Deception and inaccuracies in your statement: * You're using an average function in a non gaussian distribution. * Fees in a blockchain are a function of the transaction size * You can have multiple payments per transaction * The median fee for a typical transaction in the past week is about $1.50 USD. [1] [1] https://anduck.net/bitcoin/fees/1008_blocks.php Median is between $8/kB…

I am afraid neither average nor median should be used when transaction on money is involved. Most of us will not feel comfortable unless we know it upfront.

What if you end up paying on the extremely higher side? Would you feel comfortable using a system in which fees can swing wildly even for a minority of users.

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#72

Post by mrb »

tananaev wrote: post #38
JohnJamesRambo wrote: post #14

Bitcoin is not remotely usable as a currency now. The fees are incredible, the confirmation times ridiculous. We need to move on to something more modern like Ethereum, Stellar Lumens, etc. immediately. Asking the current 1 mb blocksize version of Bitcoin to be a currency is like Goldman Sachs writing a report saying they want to run their website on Intel 486 processors. They mention Zimbabwe moving to it as an alte…

On-chain scaling is not sustainable. If you want to handle as many transaction as for example Visa, you would need 1 GB blocks every 10 minutes, which would make the whole blockchain heavily centralized because regular users won't be able to host full nodes to validate payments. About "adopting" and increasing block size. I think most developers agree that we would need to increase it at some point, but I believe cor…

Actually there is a great way to scale on-chain: UTXO Set Commitment allows nodes to simply discard unnecessary blockchain data (in a way not too dissimilar to classic "pruning"). The data set maintained by nodes would basically grow linearly with the UTXO Set instead of the number of txns. Eg. right now it would cut 150GB down to 3GB.

Sadly it seems under-researched.

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#73

Post by DINKDINK »

MarkSweep wrote: post #70
DINKDINK wrote: post #58

Earlier quoted context omitted.

>The average Bitcoin fee is now $40 Deception and inaccuracies in your statement: * You're using an average function in a non gaussian distribution. * Fees in a blockchain are a function of the transaction size * You can have multiple payments per transaction * The median fee for a typical transaction in the past week is about $1.50 USD. [1] [1] https://anduck.net/bitcoin/fees/1008_blocks.php Median is between $8/kB…

How do you get that the median is between $8/kB and $4/kB from that page? I assume you are looking at the middle chart: https://anduck.net/bitcoin/fees/fpkb_1008blocks.png It looks like the green bars (median) are at most $50/kB to $70/kB, with a good number of dips to $30/kB and some to $12/kB. Edit: it is a confusing chart because it has mBTC/kB on one side and USD/kB on the other. And also it assume a constant exc…

>How do you get that the median is between $8/kB and $4/kB from that page? I assume you are looking at the middle chart:

The middle chart is showing the median of that block's fees. I'm referring to the median of the last week's worth of confirmed transactions. That's show in the right hand side of the first chart with the, implied, cumulative distribution function.

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#74

Post by 0wing »

erentz wrote: post #56
tananaev wrote: post #38

Earlier quoted context omitted.

On-chain scaling is not sustainable. If you want to handle as many transaction as for example Visa, you would need 1 GB blocks every 10 minutes, which would make the whole blockchain heavily centralized because regular users won't be able to host full nodes to validate payments. About "adopting" and increasing block size. I think most developers agree that we would need to increase it at some point, but I believe cor…

Not sure why you and the other person mentioning lightning have been downvoted. I’ve noticed increasingly it’s not possible to have reasonable discussion about bitcoin on hacker news. It seems the folks from /r/btc have found this place.

Please explain how the Lightning Network developers solve an unsolved NP-Hard problem in computer science regarding routing? [1]

The Lightning Network design is exactly what the first sentence of Satoshi's Bitcoin whitepaper seeks to avoid - payment processor middlemen.

  "A purely peer-to-peer version of electronic cash would 
  allow online payments to be sent directly from one party 
  to another without going through a financial institution." [2]
The LN design was chosen as a solution by certain investors who want to extract fees as payment hub liquidity providers.

LN can't solve the TSP without either publishing a map of all nodes and routes, or having all nodes broadcasts to all nodes. The former significantly reduces decentralization and further removes the "electronic cash" aspect requiring payment processor hubs, while the latter will suffer from latency/scaling issues/DDoS susceptibility.

[1] https://en.wikipedia.org/wiki/Travelling_salesman_problem

[2] https://bitcoin.org/bitcoin.pdf

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#75

Post by MarkSweep »

bobwaycott wrote: post #50
EpicEng wrote: post #42

Earlier quoted context omitted.

> more like gold But without that nifty property of intrinsic value.

There is no intrinsic value in gold. Or any other thing. The only value things have are the exchange and use values humans imbue them with.

I think intrinsic means in this context "valuable for something other than bartering with".

Gold has intrinsic value in electronics. It is used for electrical connectors due to its corrosion resistance and conductivity. Tiny golden wires are used in packaging integrated circuits (connecting the ICs to the pins of the chip).

Bitcoins have no such intrinsic value. They can only be bartered for something else.

Even fiat has intrinsic value: you can burn bills for warm.

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#76

Post by sgspace »

0wing wrote: post #12

Bitcoin and blockchain systems are nearly all designed to exploit new users and extract capital from greater fools who are too late to the game and didn't read or understand the rules and fine print. Satoshi's Bitcoin and many of the crypto-currencies that have followed create and distribute the supply that effectively creates a decentralized pyramid-ponzi scheme. Semantically, a more accurate term is needed; Bitcoin…

Wow thats a lot of words to say "I didn't buy Bitcoin when it was cheap".

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#77

Post by DSingularity »

chii wrote: post #66
westoque wrote: post #33

Earlier quoted context omitted.

Not sure “banking the unbanked” is really the goal of Bitcoin. Think instead because of it’s scarcity, Bitcoin could be used to back currencies. Much like the gold standard before. Transaction fees in this scenario (even with it’s high transaction fees for us normies) would be considered negligible when moving large amounts of money. In this scenario, we can even have other cryptos which are better for daily use be b…

> Bitcoin could be used to back currencies but why does currency need a 'backing' like this (of which was the purpose of gold originally)?

Because it needs to have value everyone agrees on.

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#78

Post by DINKDINK »

mrb wrote: post #65
DINKDINK wrote: post #58

Earlier quoted context omitted.

>The average Bitcoin fee is now $40 Deception and inaccuracies in your statement: * You're using an average function in a non gaussian distribution. * Fees in a blockchain are a function of the transaction size * You can have multiple payments per transaction * The median fee for a typical transaction in the past week is about $1.50 USD. [1] [1] https://anduck.net/bitcoin/fees/1008_blocks.php Median is between $8/kB…

There is deception in your comment too: - You are misreading your charts. The real-world median txn fee is far from $1.50... it's $13: https://bitinfocharts.com/comparison/bitcoin-median_transact... - A real-world txn is on average 500 bytes, not 250. - Although you can have multiple recipients/outputs in a single txn ("batch transactions"), it is not used very often. I computed not too long ago 2.6 outputs on averag…

>The real-world median txn fee is far from $1.50... it's $13:

The site you quote is showing the median transaction fee of each block. That's not what I stated: "The median fee for a typical transaction in the past week"

>- A real-world txn is on average 500 bytes, not 250. What's your source? https://bitcoinfees.earn.com/ indicates 225. It seems like you're using a source that assumes two UTXO inputs, which would result in a doubling of the size.

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#79

Post by mulmen »

adamnemecek wrote: post #49
jklein11 wrote: post #37

Earlier quoted context omitted.

Can you elaborate on this? In what way is it any more of a portal than government issued fiat? Is it because the infrastructure is more robust because it has been around the block longer? Is there some other technical detail that makes it exceptionally good at being a portal?

It's a portal to crypto I meant. You buy bitcoin to buy other currencies.

So... you exchange it?

Re: Goldman Sachs Report Explores Use of Bitcoin as Currency

#80

Post by pmorici »

JohnJamesRambo wrote: post #14

Bitcoin is not remotely usable as a currency now. The fees are incredible, the confirmation times ridiculous. We need to move on to something more modern like Ethereum, Stellar Lumens, etc. immediately. Asking the current 1 mb blocksize version of Bitcoin to be a currency is like Goldman Sachs writing a report saying they want to run their website on Intel 486 processors. They mention Zimbabwe moving to it as an alte…

That is why Bitcoin Cash exists to scale through bigger blocks like was intended before the hardliners came along.
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