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Comment by pc2g4d | Hacker News Reader

The high transaction fees are forcing Bitcoin in this direction. If buying a hamburger cost you $30 in fees on top of the $6 burger, you'd stop using dollars for everyday purchases, too.

Seems we're stuck in this situation so long as the block size remains where it is. That artificially reduces the supply of transactions, forcing the price up. No matter how many miners there are competing for those transaction fees, there can never be more transactions. The transaction market is really one half of a market, or a market with a "supply ceiling".

It's ironic that Bitcoin's transaction count is essentially limited _by fiat_---by fiat of the Bitcoin code that implements the block limit.

But given the relative failure of forks that increase that block limit, it seems Bitcoin is what it is and other coins will have to pick up that slack.

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No one who owns BTC wants it used for transactions. They want it to be an investment and go up forever, so they'll never go with a fork that allows it. It's like home owners in a neighborhood locking out new construction so their own homes raise in value.

That's a pretty broad generalization. Many of us work very hard to make Bitcoin usable for day-to-day transactions.

Sometimes a broad generalization is generally applicable even if not always specifically applicable.

You know, that's quite insightful. HOAs (Home Owners' Associations) are also responsible for some pretty egregious local/municipal legislative blockage as well.

Seems like the miners have a strong incentive to keep the "supply" of transactions artificially limited too, since it results in sky-high transaction fees for them.

Those who want an appreciable asset own it, those who want transactions use it.

Of course Bitcoin is the digital crypto analogy for SF Bay Area NIMBYism :)

Christ, that's some deep snark!

But that was the original goal of Bitcoin — the paper states specifically transaxtions. I personally found it interesting when I bought shoes over Overstock via BTC earlier this year; only problem was my phone didn’t have a default QR scanner.

The original goal was to have transaction fees cover network processing costs, but anyone who does the math can quickly see that the number of transactions allowed by the current block size is an issue, and prevents bitcoin from scaling to visa/mastercard levels of usage.

The reason why this flaw was accepted back then was because "space is cheap", and "we can always make the blocks bigger later".

Basically, it was a known issue all along, and the plan all along was to evolve as needed. It was never intended to be a perfect solution from the get-go.

The problem now, is that people are actively preventing bitcoin from evolving.

> The problem now, is that people are actively preventing bitcoin from evolving.

So an 'evolving' BTC market is not a stable market. Doing something that increases the transaction speed is good, but doing something that changes the fundamental rules is not.

If your income is based upon artificial scarcity, then you're going to be invested in keeping it that way.

I own bitcoin (and have for nearly five years) and I want it to be spendable as a currency again.

It realy seems the libertarian utopia story the way non libertarians envision it.

The main joke is satosi's people skills. A coin needs a community to launch it. It wil forever be asociated with it. Ponzi coin wil stay ponzi coin, porn coin wil stay porn coin etc

>they'll never go with a fork that allows it

Actually, I think that people would race to buy BTC before any fork, in order to get free money. (that explains why BCH has that volume/market)

The Lightning Network is meant to address this: https://lightning.network/

Lightning ultimately has to come into contact with Bitcoin at some point, unfortunately. Even if you just have one Bitcoin transaction a month, I'm paying $20/month at the current tx prices just to be able to use Bitcoin. $240/year. Does that sound anywhere near reasonable to you?

The goal is that there will be fewer BTC transactions once LN becomes widespread, especially if people or institutions open long-lived channels between each other (active for months, years, or even indefinitely). Then you'd only have to hit the BTC blockchain a few times a year, at most, and that's a level of transactions which the BTC blockchain can easily handle, even if the whole world population uses it for everyday trading.

However I also expect that fees will go down once this craze is over (in a few days hopefully). They have tripled in the past three days (see https://fork.lol/tx/fee).

Let's say "a few times a year" is once every two and a half months. Everyone who wanted to use Bitcoin would then have to pay about $100 a year to use it at today's rates. That's still ridiculous. And fees have increased mostly because the price increased. If people actually started using Bitcoin, the price would skyrocket and fees would rise even higher.

The fees have increased because there's not enough space in the blocks. The price increase would be irrelevant if there was enough space in blocks.

The fees have also increased because of the large number of unconfirmed transactions (we currently have over 160k transactions in the mempool). Once that decreases to more reasonable levels the tx cost will decrease, too.

Some premium credit cards come with annual fees and benefits. $100 a year for the ability to use a censorship resistant, semi-anonymous payment system doesn't sound like a bad deal.

Recent updates with video demos (looks great):

https://medium.com/@lightning_network/lightning-protocol-1-0...

Why bother attempting to patch on layers on top of BTC when it's already centralized with ASIC farms?

Start fresh.

Early adopters of BTC are trying to con new users into buying coins produced for minimal capital/computational work. The flaw in BTC is inherent to the malicious minting algorithm designed to harm new users.

There's other cryptocurrencies who are far out pacing the BTC core team.

Which currencies do you see as addressing these problems in a technically proven way?

Vertcoin is the probably the most Bitcoin-like one that addresses the mining centralization issue.

Ethereum (which definitely has its own fair share of issues) recently hit its all time high in daily transactions, which incidentally is more transactions than all other existing decentralized blockchains put together--a set containing Bitcoin.

Ha because then that would devalue bitcoin and everyone's dream of selling to a greater fool would collapse!

I agree: we need a faster settlement layer independent of how much the currency itself is worth; but let’s say we have have that network? How do taxes work? Everytime you transfer or pay for anything? That’s not going to work.

Lightning network is the biggest pile of vaporware in be whole mess. It’s been “just around the corner” for years now.

In theory segwit and offchain settlement layers (namely Lightning) can/will speed things up/reduce fees without raising the block limit. FWIW I think that they should have done both.

> But given the relative failure of forks that increase that block limit, it seems Bitcoin is what it is and other coins will have to pick up that slack.

So here's a question. Should a miner move to a fork that decreases the block limit? Would it be more beneficial or less beneficial for a miner?

This is all fixed with Bitcoin Cash.

> If buying a hamburger cost you $30 in fees on top of the $6 burger, you'd stop using dollars for everyday purchases, too.

Or maybe you'd buy a few month's worth of burgers.

But then they'd spoil!

I meant as subscriptions.

What an awful limitation. I may not want a burger next week.

OK, Bitcoin-backed debit cards.

Who cares about what they're backed with? If it's not bitcoin, then you don't get the benefits of bitcoin.

The only difference between a normal debit card and a bitcoin-backed debit card is that the bitcoin backing layer is more expensive than the usual one.

You get at least one benefit. You can keep your large-scale financial life as private as you like. Not as well as with the newer privacy-focused cryptocurrencies, of course.

And that was arguably a key goal for Bitcoin. It came up in the shadow of ecash and e-gold. Although it's not as decentralized as many expected, it's also far less vulnerable to government takedown than ecash and e-gold were. But sadly, it's no less vulnerable to speculation than any other small currency has been.

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