[HN Gopher] A Brief History of Cryptocurrency as Payment (2020)
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A Brief History of Cryptocurrency as Payment (2020)
Author : mooreds
Score : 33 points
Date : 2021-03-06 18:36 UTC (4 hours ago)
(HTM) web link (www.bakkt.com)
(TXT) w3m dump (www.bakkt.com)
| mrfinn wrote:
| It's coming, but not using Bitcoin.
| matheusmoreira wrote:
| Monero seems to be the best coin right now. Privacy built in,
| low fees and relatively stable value. Pretty amazing.
| anonisko wrote:
| Node centralization is a lot less concerning for monero
| because the privacy by default nature of it makes it very
| difficult if not impossible to censor transactions. Even if
| stupid large blocksizes results in only a handful of
| datacenter sized nodes running the network, there's not much
| they could do to try to denylist particular coins.
|
| However, node centralization does still carry the concerns
| about powerful actors being able to arbitrarily change the
| supply issuance and debase holders without explicit taxation
| or seizure.
| arcticbull wrote:
| As with all crypto projects fees are low and it's fast
| because nobody uses it. It's inefficiency kneecaps it at any
| volume.
| berenza wrote:
| be wary of bakkt, there was talk a few years ago about them
| issuing fake bitcoin and trying to valuate it like real bitcoin.
| caitlin long mentions it in an interview here.
| https://youtu.be/kxpVO6RE09E
|
| proper custodial services exist with bank charters like avanti,
| kraken and anchorage if you want a bank that guarantees real
| bitcoin and not some paper derivative made out of nothing.
| [deleted]
| yowlingcat wrote:
| Rehypothecation is pretty far away from "paper derivative made
| of nothing" -- it may not be "contracts as code" level of
| assurance, but it is "the long arm of securities and
| commodities law" level of assurance, which many would argue is
| the more critical level you would want for your assets. My
| stance on this is neutral and I think both sides have a point,
| but I think it's a little hyperbolic to call that a "paper
| derivative made out of nothing."
| xiphias2 wrote:
| The real history of cryptocurrency starts with Cypherpunks and
| all the tries before Bitcoin.
| jacquesm wrote:
| Digicash, David Chaum.
| xiphias2 wrote:
| Definitely, he was one of the most important person of the
| movement. It's too bad that he got greedy, he could have been
| rich as well.
| arcticbull wrote:
| And liberty reserve!
| liquidify wrote:
| They leave out just about everything important. No details
| regarding how the block size increases were blocked, which
| crippled bitcoin's use as a payment network.
| uncletammy wrote:
| Here's a decent thread that covers much of that:
|
| https://www.reddit.com/r/btc/comments/61mxuj/block_size_limi...
| yowlingcat wrote:
| Yeah, this seems like content marketing level drivel. There
| isn't enough information given about important events,
| structural constraints and limitations, and most importantly
| key milestones in regulations and legal guidance made for
| global institutions to begin holding the asset in a compliant
| manner.
| anonisko wrote:
| The idea that raw blockchains would ever be a scalable payment
| network for the world's population was always a _completely_
| absurd idea.
|
| In fact, it's so absurd that it was literally the first public
| comment Satoshi received.
| https://satoshi.nakamotoinstitute.org/emails/cryptography/th...
|
| > We very, very much need such a system, but the way I
| understand your proposal, it does not seem to scale to the
| required size.
|
| As a simple example, suppose every one of the 7 billion people
| on the planet make only 1 transaction per day. With a basic
| transaction size of ~250 bytes, this would require a blocksize
| of ~12GB per 10 minute block. (check my math)
|
| "But storage is cheap!" I hear some say. Even if you could
| dismiss the cost of storing an aggregating ~600TB/year, that's
| not the real bottleneck. Bandwidth and processing power are.
| You have to broadcast that 12GB block to the entire global
| bitcoin network as fast as possible to beat other miners to the
| award. Then all the world's full nodes have to do the work of
| processing that 12GB of data to validate it. All within an
| average 10 minute window.
|
| And this is all based on the absurdly conservative assumption
| that every person only makes 1 transaction per day. It's not
| even considering the use case that billions of machines might
| want to transact with each other billions of times a day. Or
| that you might want to build micropayment systems for metering.
| e.g. http://andyschroder.com/DistributedCharge/ or
| https://twitter.com/JackMallers/status/1346869624789463040
|
| And even if you could solve all these problems, it doesn't get
| around the fact that blockchains as a payment system are a
| really shitty experience compared to existing solutions. You
| have to wait an unknown amount of time for your transaction to
| make it into a block before you're safe from a double spend.
| That time is 10 minutes on average, but in reality, it could be
| anywhere from a few seconds to over an hour because mining a
| valid block is a random search that averages out to 10 minutes
| based on an ever changing balance of real world hash power and
| mining difficulty value.
|
| The only way blockchains were ever going to be interesting at
| scale is as a rock solid, incorruptible settlement layer.
| Decentralized layer two networks like Lightning are exciting
| because they have the potential to create a trustless payment
| network that directly settles to the blockchain. Even more
| exciting is that lightning can span separate blockchains and
| sidechains, e.g. BTC<->LTC or BTC<->lBTC/rBTC. And they can
| actually scale to an arbitrary number of transactions that
| don't need to all get recorded forever in the base chain
| immutable ledger.
| rafaelero wrote:
| Nowadays, transactions B2C usually involve an institution like
| Paypal or Stripe and the fees are about 3~5% of the value of the
| transaction (depending on which country you are from). I find
| this fee extraordinary high. If bitcoin can find a way to do the
| same thing in an order of magnitude cheaper (which I don't think
| is a far fetched scenario, considering Lightning Network and
| another L2 solutions being developed), then this is a trillion
| market opportunity.
| CyberDildonics wrote:
| Why would someone use an awkward and complicated second layer
| built on top of 1.5KB/s of transactions that cost $25 ?
|
| Ethereum and bitcoin cash both exceed bitcoin's transaction
| throughput. Ethereum dwarfs everything else in number of
| transactions per day.
|
| If everyone in the world uses bitcoin, everyone will get a
| single on chain transaction every 60 years, even though a
| single hard drive could store the next 300 years of
| transactions at this rate.
|
| If your internet connection had the throughput of bitcoin,
| reddit.com would take 36 minutes to load.
|
| There is no technical reason it has to be this way, bitcoin was
| crippled just to sell you a second layer while other
| cryptocurrencies are easily blowing past it in transaction
| throughput.
| arcticbull wrote:
| Ether fees are staggering now too, and Bitcoin cash fees are
| low because nobody uses it.
|
| The reality is the inefficiency required to meet the
| decentralized trustless verifiable goals is so high it's not
| possible to build a crypto payment network which actually
| handles more transactions than a midsized Costco.
| devops000 wrote:
| Why should I pay in BTC through Bakkt instead of USD ? BTC was
| invented as p2p payments, now everybody wants to control
| transactions and get a fee
| arcticbull wrote:
| Just store it at BNY Mellon and use a Visa card to transact
| haha.
|
| The issue of course is the transaction rate is so low and the
| system so inefficient it cannot possibly meet its stated goal
| as a payments system without trusted, centralized networks.
| worik wrote:
| For some one not doing crime (or making donations to
| Wikileaks...) living in a country with a financial system, what
| is the point? Why bother?
| kache_ wrote:
| People have been using cryptocurrency to pay for things since
| 2011, and today still. Check white house market & monero.
| howmayiannoyyou wrote:
| Stellar (XLM), Ripple (XLP), Cardano (ADA) and several others are
| promising transactional tech, particularly for cross-currency
| transactions in the case of XLM. That said, all three are less
| decentralized as a result.
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(page generated 2021-03-06 23:01 UTC)