Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017 • Hacker News Board

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#61

Post by gruez » Fri, Apr 23, 2021, 12:13 AM UTC

devname wrote: post #56

gruez wrote: post #34

Earlier quoted context omitted.

> The second-layer transactions could just float, like the dollar separated from the gold standard. You can't mint more bitcoins on the lightning network. There's a 1:1 relation between what's on the lightning network and what's on the blockchain. This is as opposed to fiat (zero relation, currency units can be generated at will), or gold standard in practice (the central bank only having enough gold for a fraction o…

A triangle ABC of lightning nodes opens a channel with 1 bitcoin between nodes. 3 bitcoins total. Each node can have a state with a total of 2 bitcoins. That's 6 bitcoins. It'd be a race to close channels, and only if the channel value is above the fee-floor, else the settled value is $0.

> A triangle ABC of lightning nodes opens a channel with 1 bitcoin between nodes. 3 bitcoins total.

>Each node can have a state with a total of 2 bitcoins. That's 6 bitcoins.

Well, no. If you want a channel between A and B with 1 BTC capacity in either direction, you'll need to deposit 2 BTC to fund the channel. Therefore there's 6 BTC total that's locked up. As for the rest of your comment, it's not really clear how it's "separated" from the on-chain value.

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#62

Post by gruez » Fri, Apr 23, 2021, 12:18 AM UTC

noxer wrote: post #54

wmf wrote: post #43

Earlier quoted context omitted.

In one year from now there will probably be coins that can do >1,000 TPS on layer 1 with negligible fees with intuitive wallets and all exchanges will have integrated them.

These coins exists already since many years. See XRPL.org for the oldest "better bitcoin project". It has tested 1500 TPS and block time of a few seconds and on top of that a fully working second layer for high volume channels between 2 parties where the TPS is only limited by the speed of the hardware. It on average has more transaction per day than bitcoin ever had and it does that since years.

It's worth nothing those coins also took some liberties when it comes to establishing consensus. I believe the consensus model for XRP is "ask some trusted nodes what the state is and believe the majority".

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#63

Post by pfundstein » Fri, Apr 23, 2021, 12:35 AM UTC

this_user wrote: post #24

noxer wrote: post #19

Earlier quoted context omitted.

I knew this would be posted. Such an absurdly stupid reasoning. You wanna pay for your coffee or buy car or whatever and the fee is slapped on top of the price. Who the heck would care about satishis per byte. Its % of the transacted value that matters. High fees means low value Tx are no longer "possible". >which to me says that it's becoming the settlement layer as expected. So it went from p2p cash to store of val…

The conundrum at the heart of BTC is that you have to introduce a second layer in order to work around the inherent limitations of the first. But at that point you may as well do away with that first layer, and then will have simply re-invented PayPay, which only goes to show how "blockchain technology" is almost entirely useless.

> you have to introduce a second layer in order to work around the inherent limitations

Not true, the block size was intended to deal with this exact issue.

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#64

Post by pfundstein » Fri, Apr 23, 2021, 12:59 AM UTC

gruez wrote: post #62

noxer wrote: post #54

Earlier quoted context omitted.

These coins exists already since many years. See XRPL.org for the oldest "better bitcoin project". It has tested 1500 TPS and block time of a few seconds and on top of that a fully working second layer for high volume channels between 2 parties where the TPS is only limited by the speed of the hardware. It on average has more transaction per day than bitcoin ever had and it does that since years.

It's worth nothing those coins also took some liberties when it comes to establishing consensus. I believe the consensus model for XRP is "ask some trusted nodes what the state is and believe the majority".

Others however, just increased the block size to allow for more transactions per block and thereby lower fees. This is the intended purpose of the block size as set forth in the Bitcoin whitepaper.

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#65

Post by CyberDildonics » Fri, Apr 23, 2021, 1:03 AM UTC

rawtxapp wrote: post #4

That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per byte, it's actually much lower [1][3]. And if you want to avoid the fees because you expect to transact a lot, just use lightning network, exchanges are starting to integrate it[2]. edit: I should also add that, when you look at it in terms of USD, the average transaction fee is a drop in the bucket compared to the avera…

The lightning network has been promised for 7 years now. Exactly what people predicted has happened. It doesn't work, no one wants it, it tries to solve a problem that is already solved by not using a crippled crypto currency with the transaction bandwidth of a dial up modem.

Ethereum is multiple times btc in transaction throughput. Bitcoin cash has had higher transaction throughput for a while now too.

The people that made bitcoin originally were geniuses. The dunces that made the lightning network are nonsense charlatans. Go to /r/bitcoin and start asking questions, then see how long it takes to banned.

Anything other than btc and ethereum works for avoiding high transaction fees. Why would someone use a hacky second layer and defeat the purpose of crypto currencies when even a joke clone like dogecoin works better? Crypto currency works so well it has to be purposely broken like bitcoin to stop working well.

Right now the commonly accepted cryptocurrencies with reasonable transaction fees are litecoin and bitcoin cash with dogecoin being around $1 USD. That isn't impossible to work with but it isn't necessary.

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#66

Post by hapticmonkey » Fri, Apr 23, 2021, 1:44 AM UTC

AlexandrB wrote: post #8

rawtxapp wrote: post #4

That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per byte, it's actually much lower [1][3]. And if you want to avoid the fees because you expect to transact a lot, just use lightning network, exchanges are starting to integrate it[2]. edit: I should also add that, when you look at it in terms of USD, the average transaction fee is a drop in the bucket compared to the avera…

I'm a long-time bitcoin skeptic, and I don't really understand the lightning network. If the lightning network doesn't depend on PoW for every transaction then how is it different than a normal database-backed payment network? I read that it involves smart contracts, have those been sufficiently audited against bugs? > That's because you're looking at it in terms of USD, when you look at it in terms of satoshis per b…

Bitcoin in the Lightning Network are backed by the bitcoin blockchain. Bitcoin get committed to the Lightning Network (using an on-chain transaction) and can then move between users of the network. There is no central database of all Lighting users or transactions. Transactions are done directly between users, or by routing payments through other users.

It's kept trustless, because people trying to cheat can get their bitcoin stolen. This is done using fancy bitcoin multi-signature scripts. Closing a Lighting Channel using an old state (ie: being dishonest) reveals keys that can be used by the other (honest) party to take your funds.

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#67

Post by hapticmonkey » Fri, Apr 23, 2021, 1:55 AM UTC

AlexandrB wrote: post #30

rawtxapp wrote: post #13

Earlier quoted context omitted.

A transaction is essentially just a signed cryptographic message broadcast to the network, just imagine that instead of broadcasting it, you keep iterating on it, you pass funds around, keep signing these messages, etc. There are measures to make sure you don't broadcast an old/outdated transaction to the network. It's not meant for buying coffee, for those you would use layer 2 or centralized entities like Paypal, e…

Thanks for taking the time to explain. I guess I remain skeptical as it seems like a lot of complexity that is slowly replicating the traditional banking system - just with transactions enumerated in a volatile equity instead of $currency. Perhaps I'm just getting old.

The key difference is this infrastructure is 100% trustless. Bitcoin transactions are backed by proof-of-work, and Lightning transactions are backed by HTLC (hashed timelock contracts) which are in turn backed by the proof-of-work. Think of the blockchain more like a settlement layer and the Lighting network an everyday transaction layer.

That's the current goal of the developers of these systems, anyway.

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#68

Post by QuestionC » Fri, Apr 23, 2021, 2:52 AM UTC

dmm wrote: post #2

What happened in 2017? What's happening now? Is it related to miners being shutdown in China?

People are panicking over Biden's ridiculous proposed capital gains tax changes. Everyone's panic selling and hiding assets.

2017 was the previous Bitcoin pump and panic.

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#69

Post by UncleMeat » Fri, Apr 23, 2021, 2:53 AM UTC

gruez wrote: post #53

UncleMeat wrote: post #40

Earlier quoted context omitted.

Sure you can. Just mint some "lightnings" and move on. Nothing stops a large centralized processor from creating its own coin. L2 is also shit for actual distribution and censorship resistance. Imagine a future where BTC is 100x the current price and the people who got in early are rich as heck and nobody else can afford even a single transaction and must instead rely entirely on L2 services, never actually owning th…

> Sure you can. Just mint some "lightnings" and move on. Nothing stops a large centralized processor from creating its own coin. But that's literally not how the lightning network works? If some intermediary in the chain wants to accept IOUs in place of real bitcoins that's on them, but on both ends you're putting in and getting real bitcoins. By "real bitcoins" I mean they can be redeemed at any point in time by clo…

It isn't how the lightning network works... until everybody without vast sums of wealth have literally no alternative except to transact through approved L2 providers. Then we are right back at numbers in centralized databases with no restriction whatsoever.

Re: Avg. Transaction Fee of Bitcoin Surpassed the Peak from 2017

#70

Post by singularity2001 » Fri, Apr 23, 2021, 5:19 AM UTC

gruez wrote: post #28

this_user wrote: post #24

Earlier quoted context omitted.

The conundrum at the heart of BTC is that you have to introduce a second layer in order to work around the inherent limitations of the first. But at that point you may as well do away with that first layer, and then will have simply re-invented PayPay, which only goes to show how "blockchain technology" is almost entirely useless.

>But at that point you may as well do away with that first layer, and then will have simply re-invented PayPay, which only goes to show how "blockchain technology" is almost entirely useless. the lightning network isn't going to freeze your funds for 180 days because they think your account is suspicious.

I remember getting "this feature is currently suspended" messages on kraken when trying to pull my money out during the last bitcoin crash.