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Comment by mchristen | Hacker News Reader

The size of blocks is not core to the algorithm of Bitcoin though. What would you say to the person trying to send $30 only to have $20 of it eaten up in fees? Come back later when you can afford to use Bitcoin?

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Use a different cryptocurrency.

Seriously. And I'm not trying to be cheeky. If Bitcoin ends up only being a settlement layer, it'll still be a colossal success just being a decentralized, supply-limited, uncensorable, world-accessible payment system and store of value.

If someone else solves the scaling debacle better, I'll be the first to recommend that normal people switch to it. But it's not easy, and the world is watching Bitcoin. Governments are starting to accept its existence, big financial institutions are starting (just this month) to allow options trading, etc. That stuff is far more important even for other cryptocurrencies than low fees.

After six months of no issues with Bitcoin options trading, it's only a matter of time before other cryptocurrencies get the same treatment. That's why we need Bitcoin to be rock steady and predictable, while others can try to solve these tough problems.

This sounds a hell lot like changing the goal posts.

No, plenty of us have been saying this for a long time. Here is a HN post from 5 years ago where I say:

“even if it's only ever used for politically sensitive transactions, and it never takes off as a consumer payment service, it will be a very big economy” https://news.ycombinator.com/item?id=5526684#5526972

The goalposts for Bitcoin have always just been “can it sustain its market cap?”

Also it's not like everyone you see on the Internet is the same person.

Anyone who was hoping for it to replace credit cards didn't understand the system. Lots of other folks have known the limitations of Bitcoin for years and what we're seeing today was totally predictable.

To be fair, becoming a quarter trillion dollar store of 'digital gold' is a hell of a pivot.

Does that matter? If you're looking to develop a drug to treat hypertension but end up with Viagra by accident instead, do you throw it away because that wasn't the original goal?

It certainly matters if you've still got a lot of people running around telling anyone that will listen that the drug is a sure-fire cure for hypertension.

There's a lot of people in the world running around telling people all kinds of things.

If the production of Viagra at scale winds up causing global health problems, then yes, you throw it away.

This may be straining the metaphor a bit, but I think you underestimate how much individuals want a magic sex pill.

Tell that to the FDA...

Oh it absolutely is. I'll acknowledge that. If Bitcoin is amazing at 7/12 of the things it set out to do, and sticking to those seven will pave the way for the other five to be done by other cryptocurrencies, that's fair to me.

Yeah, well.... It would seem "transactions" should be among the things that a currency does well.

Not necessarily. Bags of grain or N cows did not do transactions well. Yet they were successful as currencies for millennia.

times have changed since...

I'm pretty sure bags of grain are still a significant unit of value exchange[1].

[1] yep: http://www.nasdaq.com/markets/wheat.aspx

They have, and we have bitcoins instead of bags of grain.

"Use a different cryptocurrency."

I started using Bitcoin Cash instead and I'm loving it. All the good parts about Bitcoin Core w/o the brain dead approach to scaling.

Yep. I expect the fee market alone will drive normal people toward Bitcoin Cash.

Dogecoin has much cheaper fees than Bcash and its block confirmation target is around 1 minute -- roughly an order of magnitude cheaper and faster than Bcash.

A note to readers: "Bcash" is a derogary term used by Core supporters to undermine and discredit Bitcoin Cash. Always be mindful when someone uses it.

“Bitcoin cash” is a name chosen to confuse newcomers and attempt to steal the bitcoin brand. The CEO of bcash refers to Bitcoin as “SegwitCoin” and their official /r/btc subreddit regularly claims to be the real bitcoin.

Bcash is an appropriate name for the altcoin to eliminate confusion.

This is the kind of propaganda Core is pushing.

Note that there is no CEO and the very same people who refer to Bitcoin Cash as Bcash refer to Ethereum Classic, Bitcoin Gold and others by their proper name...

Of course there’s a CEO. Here’s an official statement from him: https://falkvinge.net/wp-content/uploads/2017/11/letter-from...

Doge has unlimited inflation it is nothing like Bitcoin Cash.

That doesn't matter if you only use it for transactions. Step in, transact, step out.

Who is going to pay you for your Dogecoin if no one wants to hold them?

This is indeed the folly of only valuating a coin for its transactional properties.

Who's going to work for USD if no one wants to hold them?

No one, but that's an irrelevant hypothetical because people do want to hold them and that's unlikely to change. Even if people in the US did want to get paid in a different currency, they would still need some USD to pay their tax bill.

United States persons with tax or debt obligations, obviously.

Bcash is already over-inflated relative to Bitcoin due to its mining algorithm. When the block reward diminishes enough, and fees don't supplant it, Bcash will hard fork to infinite inflation.

It's 0.001% over-inflated? So it reaches the 2020 halving earlier, and wins then too.

In the ~4 months since its creation, 115,975 Bcash tokens were mined ahead of schedule.

It is about 60 days ahead at most and it doesn't matter because the hard cap of 21 million coins is till the same. This has gotta be the dumbest argument I've ever heard.

The hard cap is the same until it isn't -- when Bcash has to hard fork to infinite inflation in order to incentivize mining because fees won't supplant the mining reward.

Not gonna happen.

Explain to me what will incentivize mining on Bcash when the fees are too low compared to Bitcoin? The mining subsidy, by design, is eventually supplanted by transaction fees.

For those interested in this "inflation", there is a good chart here:

https://fork.lol/blocks/height

As it says, "Block height. BCH is currently ahead by 9272 blocks." with the block height of both being about 500k.

In fact, with the rate that BTC gains hashing power, and its comparatively less responsive difficulty adjustment algorithm, it is expected to overtake BCH's block height in the next couple of years.

If i gave you a search algorithm with a big db then asked if it could done quicker would you prefer to spin up more cpu's or try to improve the algorithm?

I would spin up more CPUs. Because changing code in the near term is expensive and hard. Spinning up more CPUs is cheap and easy and ensures my company remains successful while I optimize the algorithm.

Using your analogy Bitcoin Core is saying they are going to shut down Bitcoin service to all new users until they implement a new algorithm that hasn't been proven yet and is still years away from being ready.

^ Exactly. The answer should almost always be spin up more cpu's.

Depends on the search algorithm; if it can be parallelized, then modify the algorithm to take advantages of multiple CPUs. If not, then start throwing more threads at it.

In Bitcoin’s case, I don’t think we have a lack of CPUs though.

the velocity of money increases price, look at how the price of litecoin is rising when bitcoin mempool is congested, if Coinbase didnt play politics, Bitcoin Cash will be pumping right now too, decentralized exchanges are coming though in the coming years it will change the whole market dynamic

Exactly. But the critical fight is public acceptance and a lack of government interference. To win that, all Bitcoin needs to do is keep doing what it's doing.

> If Bitcoin ends up only being a settlement layer, it'll still be a colossal success just being a decentralized, supply-limited, uncensorable, world-accessible payment system and store of value.

So, what happens when all the bitcoin are generated and mining is complete?

Mining is still very profitable due to transaction fees.

I'd say stop storing your spending money as btc, it's an asset not cash. Can you liquidate your 30$ peice of gold in < 4 hours for market value? Probably not.

"Bitcoin: A Peer-to-Peer Electronic Cash System"

Peer to peer cash.

Not "Gold", not "asset", but "Peer-to-Peer Electronic Cash".

The IRS classifies and taxes it as an asset because functionally it is an asset. The design is speculated to be based off of hashcash and maybe it was suppose to be used as cash and in a way it is still useful as "electronic cash" for online orders since wait times are less relevant.

http://www.hashcash.org/papers/hashcash.pdf

The IRS is wrong.

How so?

And obviously it doesn't matter if the law is wrong, it's still the law. But in this instance, why do you believe it to be wrong?

The IRS classifies and taxes it as an asset because functionally it is an asset. Satoshi was doing a bit of marketing with the title of his paper.

Bitcoin cash is still that.

Bitcoin Cash does indeed have very low fees... and about a tenth the transaction volume of Bitcoin proper, with few places using it, mainly just a handful of people involved in creating it.

It's certainly not as ridiculous an option as it was back before the difficulty adjustment fix when its supporters were promoting it as the fast option despite it usually taking days for transactions to confirm (supporters responding that block times were as low as a minute sometimes, and they were right... except it was a entirely bimodal distribution, with most of the time spent in the "hours per block" part).

However, the increased transaction capacity people are promoting is still about 100x its current transaction rate, and it's entirely unclear how well it'd handle scaling up by that much in practice. Especially since I'm pretty sure it lacks some of the scaling work that the original Bitcoin has. Also, the rampant dishonesty and all the attempts by sites and services owned by a guy with a major investment in it to trick people into thinking it is Bitcoin don't inspire confidence.

Bitcoin Cash has been around for 3 months. 1 tenth the volume in that time is extremely impressive given than popular services like Coinbase and Bitpay don't even support it yet.

Exactly. Price aside, the growth is insane. Things are being built. Merchants are coming back online. Within a few months the sentiment will start to change for BCH.

For those who don't know, Bitcoin forked into 1 "new" Bitcoin (kept the name, changed the model from currency to speculative asset), and 2 Bitcoin Cash, that continued development along the original crypto-currency design.

https://www.investopedia.com/tech/bitcoin-vs-bitcoin-cash-wh...

Indeed, what part of the name "cryptocurrency" would lead someone to believe it to be like cash?

Currency A currency in the most specific use of the word refers to money in any form when in actual use or circulation as a medium of exchange, especially circulating banknotes and coins. A more general definition is that a currency is a system of money (monetary units) in common use, especially in a nation. Under this definition, British pounds, U.S. dollars, and European euros are examples of currency.

Wikipedia

Yes, a "currency" should be treated as an asset, not cash.

The pro-BTC arguments are becoming absolutely inane

To me it sounds like an admission that Bitcoin doesn't work too well as a currency.

It's classic goalpost-moving.

AKA pivoting.

Wikipedia

Stores-of-value aren't "actually used" nor "medium of exchange". Bitcoin Cash fixes Bitcoin, restoring its utility and will cannibalize Bitcoin's market share.

I can take my maple leave or krugerrand and change that in any crash for gold/western union/money exchange shed for almost market rate in minutes. There are plenty of them. Even I take a cap that is its faster and cheaper than bitcoin.

I can take my seed words inside my brain through airport security.

Let's not get started on verification of the asset!

tbh, the smaller amount transacted, the less decentralization is necessary IMO. This is why people will tell you to use other, more centralized, less secure cryptos.

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