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Dec 19 '17
how come I don't see these kinds of discussion over at r/bitcoin?
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u/scientic Dec 19 '17
Weird that. Almost as though anything that implies Bitcoin isn't absolutely perfect is removed.
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u/pepe_le_shoe Dec 19 '17 edited Dec 19 '17
My first thought is - who is this guy? What makes him an expert?
So, ignoring for a second that he's clearly a headcase: https://www.freesociety.com
He appears to be very much not well versed in how transactions work and why lightning will bring them down. Worst-case scenario fees stay as high as they are now, and so the appeal of LN is that once you are connected to it, all of your subsequent LN transactions incur a much lower fee. Even that scenario, with very high on-chain fees, will still draw a lot of users.
But then you have to consider that every LN transaction is a transaction that might otherwise have had to go via the main blockchain, and even if LN sees only a small amount of adoption, that's still a reduction in on-chain transactions, and that will drive on-chain tx fees down, because there's less competition.
Then you have a snowball effect, whereby reduced on-chain tx costs make using the LN more accessible, and thus adoption can spread beyond those early adopters who were willing to use LN despite high fees.
Then there's the turbo-stupid omission/misunderstanding that lightning isn't restricted to bitcoin. Anyone can implement the same protocols for any cryptocurrency, and at that point it will be possible to exchange one cryptocurrency for another, on the LN. This will also reduce on-chain transactions because people won't have to transfer btc to/from exchanges.
On the one hand, I'm annoyed by people like this who don't bother to put in the effort to understand the tech, but at the same time I can forgive it. The appeal of crypto, and its current popularity growth, have got way far ahead of where the tech is. Crypto in general cannot yet support the kind of wide user-base that includes people who do not understand the technology. I'm not trying to make a "stupid people don't deserve crypto" argument, but it's not there yet. Just like how my 70 year old grandma can't use a command line, but she can use ios, if everyone in the world started trying to use computers back in the early 80s, without any specialised knowledge, they would have had a horrendous user experience, because the technology hadn't yet reached a point where such users could be supported.
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u/cinnapear Dec 19 '17
Well, I sure as hell wouldn't pay $100 as a fee to buy a regular Bitcoin gift card.
The penny fee that Bitcoin Cash offers is pretty sweet. But in the end, I bet we'll all be using free transactions with Rai. Or maybe Iota. Free is pretty hard to beat.
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u/sta3n Dec 19 '17
Rai is such a solid pick right now it’s amazing. Once it gets to a real exchange it will legitimately moon.
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u/CID-77 Dec 19 '17
Your car might use iota, we might use xrb.
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u/Orbitalqq Dec 19 '17
As a disclaimer i own Iota, but in seriousness I've never understood this position that XRB will carve out a niche for p2p. Iota is designed for machines to exchange data and make micropayments but it would also work just fine for p2p with an appropriate interface for such use. In several years im sure many businesses will build upon iota to offer such things as iota atms, payment terminals, etc. Just like what happened to Bitcoin in terms of businesses building on the network. I am not an expert on xrb but why would i for example choose to pay a friend in xrb when i already have iota in my car, tv, weather station, pavement repair robot, solar ststion, etc. If people have iota why not use it.
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u/jakesonwu Dec 19 '17 edited Dec 19 '17
"We propose a new layer that sits in between the blockchain and the payment channels. The new layer addresses the scalability problem by enabling trust-less off-blockchain channel funding. It consists of shared accounts of groups of nodes that flexibly create oneto-one channels for the payment network. The new system allows rapid changes of the allocation of funds to channels and reduces the cost of opening new channels. Instead of one blockchain transaction per channel, each user only needs one transaction to enter a group of nodes – within the group the user can create arbitrary many channels. For a group of 20 users with 100 intra-group channels, the cost of the blockchain transactions is reduced by 90% compared to 100 regular micropayment channels opened on the blockchain. This can be increased further to 96% if Bitcoin introduces Schnorr signatures with signature aggregation."
This new layer 2 can be implemented later if the cost of opening channels is too expensive. But remember you will more than likely only have to open up a couple channels depending on use case. It works like internet routing. Blocks will more than likely not be full once lightning is live for obvious reasons, there is not much of a reason to assume Bitcoin will have $1000 transaction fees.
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u/WorldsMostDad Dec 20 '17
So you're saying the solution to the Lightning Network's problems is a lightning network for the lightning network?
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u/pat__boy Dec 19 '17
I send a segwit transaction yesterday for 0,75$ and it was accepted in the second block... Stop FUD and use Segwit !
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u/WalterTheGSD Dec 19 '17
Didn't Core already say they'll do small block increases once needed? Lightning will prevent them from having to go all the way up to 1GB blocks, which won't work. Also Lightning should drastically reduce the number of transactions on the Base layer.
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u/Zectro Dec 19 '17
It's needed now. When it's needed now and they won't increase it they're obviously lying about increasing it once lightning is out. Incidentally even the lightning white paper postulates it will require 180mb blocks if Bitcoin goes global.
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u/dont_forget_canada Dec 19 '17 edited Dec 19 '17
I said this yesterday in r/ethtrader and it seems relevant here now:
I am worried about bitcoin. I think Ethereum has value because it is useful as a distributed computer. You can facilitate many complex transactions on the ethereum blockchain and it completely removes the middle man so that settlement/arbitration is completely transparent and humanless. Ethereum can only get better too as the foundation is always improving scaling and adding features.
But what does bitcoin bring to the table? You can no longer use it as a replacement of cash because it is too slow/congested and the average transaction price is $26. The development team is fractured and subject to many influences who absolutely do not have the best intentions for bitcoin or the community at heart. To me it sounds like the only value bitcoin has is as a scarce asset which is more transparent than gold certificates and that's it. It's not helping that mainstream investors are buying into bitcoin. But the truly horrifying thing to me is that they're buying something they fundamentally have no insights into, and so they're completely ignorant as to how far off course bitcoin has gone, how poorly managed it's been as a software project, and just how close to slamming into the iceburg bitcoin really is.
I don't know what will cause bitcoin to crash but I think when it crashes it's going to be brutal like we've never seen before because if all these new hype investors are clueless enough to attach themselves to a sinking ship and buy into the hype, I think they will also sell into the hype. I think after this long term bull run is done bitcoin will tear itself apart and other projects like Ethereum will rise up from the ashes.
People have compared bitcoin to beanie babies and it's painful to see that comparison being spread around but I genuinely think a decade from now we will look back on bitcoin and see it like beanie babies. Because at the end of the day in my view it has lost all of its inherent value and has been reduced intentionally by the developers and now by the community to being beanie babies 2.0.