100 transactions/second still doesn’t sound like a lot, especially if you want Bitcoin to be an actual currency used for exchange of goods.
Bitcoin's throughout is absolutely pathetic, by several orders of magnitude. I think the only reason that aspect hasn't gotten more attention is because the energy efficiency is even worse.
Every junk transaction costs them money
If it is bitcoin or ethereum there are very high fees for each transaction. The exchange is showing you those fees in your native currency. They aren't getting that money, it is going to the miners.
Or if the exchange isn't fully collateralized, it's a scam and goes under.
Civilization works because of laws that are interpreted by courts and norms which are broadly accepted but not often checked/enforced. Crypto is trying to create a "trustless" future where you do not need society to coordinate and regulate. Our modern financial system needs that squishiness/trust which you get from the legal system to operate at full capacity.
Picture the suspension of a car. In our modern financial world, the legal system and regulatory institutions serve as the shocks and struts of your car. It allows you to drive fast while not having to worry about every imperfection on the road. Cryptocurency is like driving a car where your wheels are attached directly to the axel - yes it's perfectly efficient and there's nothing between you and the road, but that also means you have to be exceptionally careful where you are driving, and you can't do it fast.
There's a reason all cars come with suspensions.
Could you elaborate on this?
The problem I foresee is that having someone you have to trust is not a bad thing because at least you're able to identify that entity's traits and act accordingly. If that entity is, for example, the world's largest military power, I might feel like I have a lot less to worry about than if they're, as another example, a publicly traded company about half the size of the average major U.S. bank.
Is this what you're alluding to?
Part of the problem is language. "Trust" isn't just trust in a particular actor's intent, but also in their capabilities to carry through on a promise. In order to trust somebody to carry out a promise, you need to indirectly trust on others not to interfere with that promise. In this case, if you don't trust the US government to handle currency, then you certainly can't trust a publicly traded company that is beholding to work within and has assets that can be seized by the US government. If you assume ill-intent on the part of the government, then there's no reason to assume that a smaller actor wouldn't be influenced by the government.
In this case, I trust the US government to manage currency well, because it is in its best interest to do so.
I don't think you get to declare what "the entire purpose of cryptocurrency" is! People tend to get confused about what "trustlessness" actually means. It certainly doesn't mean that every single aspect of every transaction involving cryptocurrency must not require any party to place any trust in another party. If you're using cryptocurrency to buy bread you still need to trust that the baker hasn't poisoned your bread, and that need for trust must be addressed by some mechanism unrelated to cryptocurrency (like the baker's reputation, or laws against poisoning people). That doesn't illustrate some absurdity in the idea of cryptocurrency or "defeat the entire purpose of cryptocurrency."
But, there is not a single thing in cryptocurrencies that make sense if you are willing to allow for centralization. If you have a centralized system, then you have a limited number of actors allowed to make changes to the ledger. You can establish trust out-of-band, whether that means by passing around gpg keys, by investigating previous banking practices, or by establishing common rules for auditing. After that, there's no need for Proof of Work/Stake/Space/etc, because you can trust the updates coming from the rest of the network.
The reason I say that the point of cryptocurrency is trustlessness and decentralization is because the only other alternative is that all the implementers of cryptocurrencies are utter fools not to see the simpler solution. I don't think that is the case. I think they have seen the simpler solution of trusted validators, and have dismissed it out of a fundamental difference in priorities from mine, but I don't think they are fools.
Mind you, I don't mind centralized systems, but the entire marketing of cryptocurrencies for the past decade has been how it is decentralized and outside of the the reach of any entity. We knew this wasn't the case in 2014, when Mt Gox folded and all signs pointed to fraud. We knew this wasn't the case in 2016, when the Dao smart contract was reversed by general appeal. We know it now as mining pools continue to rise. The decentralization is the main selling point of cryptocurrencies, and yet at every turn it is proven false.
And then down at the consumer level it's nothing at all. During peak hours of the peak season (Christmas), Visa does something like 50,000 tps.
What makes Bitcoin interesting is the trustlessness of the transfers, and that tends to be more interesting higher up the stack (at the inter-bank and inter-national levels) than at the consumer level. But you can also combine this with layer two technologies like payment channels, ILP (interledger protocol), and the lightning network to get rapid transfers where most of the transactions never hit the chain.
The Sia network for example does something like 30 million transactions per day (that's about 300 tps), but only about 500 of those are actually on-chain at the settlement layer. The rest are ultra efficient off-chain payments that only require a packet or two to be sent between two machines (as opposed to broadcast).
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From the perspective of "everyone can own and use bitcoin", 100 tps is not quite enough. To support 1 billion people on Bitcoin even with the best layer 2 systems we have in theory, you need about 400 tps. So 7 billion would need like 3,000 tps.
What's interesting about that? Higher up the stack, trustlessness is not compelling at all - if I'm transacting with you on the scale of six-plus figures, I absolutely won't transact with someone I don't trust, and anonymity is a defect - I want to know who you are so I can sue you if our deal goes sideways.
For meatspace the best you can do is one-way. If I'm buying a car with Bitcoin, I still need to trust the car manufacturer to deliver, but the car manufacturer does not need to trust me. They don't need to know who I am or how deep my credit line is, as soon as the bitcoin hits their wallets they have extreme confidence that the transaction won't be reverted. No bounced checks, no chargebacks, etc. It's a zero fraud system, and there's also no intermediate party (like PayPal or a bank) that can decide the transaction shouldn't happen. Whether or not the payment is accepted is at the sole discretion of the recipient.
Payment reversal is not possible, fraud is still just as possible as it is with a traditional transaction. If I were selling a fake van Gogh, I'd prefer BTC for the transaction, but if I were selling a legit van Gogh I'm not worried about being sued over, a wire would suffice. I would think more than twice about transacting with anyone in large amounts who insists on transacting in BTC.
Forgot to mention - no? This isn't how the protocol works, you have zero discretion about whether to accept payment or not in BTC. If ISIL sends your wallet a million dollars then that's that, you've just received money from a terrorist group, the whole world knows it, and now the feds want to talk to you.
With current system money is still somewhere and you can drag them to court as final step. With crypto, no luck it is just lost.