<story><title>Did Bitcoin just prove it can&apos;t scale?</title><text>The past few days have shown what happens when many people attempt many transactions using Bitcoin. The network slowed to a crawl. Transaction prices went through the roof. And we still are at a point where only a tiny fraction of people are using Bitcoin, and only a tiny fraction of all financial transactions are using Bitcoin.&lt;p&gt;How is this expected to work with 7 billion people using it for every tiny financial transaction? I don&amp;#x27;t think it can.&lt;p&gt;I have owned BTC for 5 years and I am enjoying the rally, but with the high transaction fees, back log, and long transaction times, I wonder how well it can really work as a replacement for banks.&lt;p&gt;Am I wrong?</text></story><parent_chain><item><author>theWatcher37</author><text>This defeats the entire purpose of bitcoin. The goal is a decentralized currency that isn’t controlled by shady political interests, and can reasonably replace normal currency.&lt;p&gt;Why would you want Bank 2.0?</text></item><item><author>wildmusings</author><text>I’m not sold on Bitcoin but I don’t agree with your definition of what it needs to be successful. There is no reason that actual bitcoin end-users need to deal directly in bitcoin. If Bitcoin were to ever become a major currency, a big if, there would be financial institutions (banks) issuing instruments (physical or digital notes) backed by real bitcoins held by those institutions. Real bitcoin transactions would be mostly performed between such institutions, or anyone else willing to pay the higher transaction fees. Most people would have their needs perfectly served by relying on bitcoin banks, at least for performing frequent transactions. Though they might very well seek to hold large sums directly in BTC.</text></item><item><author>KirinDave</author><text>Bitcoin is a lot of things, and many of them interesting, but suggesting that ~4 t&amp;#x2F;s is impressive or &amp;quot;scaling&amp;quot; is an insult to kids in high school writing rails apps that can do 100x the volume.&lt;p&gt;We already know at least 2 obvious ways to improve the transaction flow rate of bitcoin in trustless ways, and many others are being proposed that do not also create energy arms races.&lt;p&gt;Please don&amp;#x27;t redefine success.</text></item><item><author>moduspol</author><text>Others here are touching on Bitcoin being like the &amp;quot;1.0&amp;quot; of cryptocurrency, but it&amp;#x27;s actually a lot more than that. In the public eye, it&amp;#x27;s a symbol of what cryptocurrencies can be.&lt;p&gt;You&amp;#x27;re suggesting Bitcoin just proved it can&amp;#x27;t scale, but it actually just proved it did--just not with transaction volume. The network continued to process transactions averaging one block every ten minutes exactly as it was built to do, despite the heavy load.&lt;p&gt;To put it differently: A different online payment system could have stopped accepting transactions, or run out of resources, allow transactions it shouldn&amp;#x27;t have, disallow ones it should, or something else terrible. But Bitcoin didn&amp;#x27;t. If you wanted into the next block, you&amp;#x27;d need to pay more, but that&amp;#x27;s (from a technical perspective) entirely by design.&lt;p&gt;What Bitcoin is proving is that it has clear and well-understood limits and continues to work well within them, and that&amp;#x27;s incredibly important for public perception. IMO, if Bitcoin&amp;#x27;s transaction capacity never scales, it&amp;#x27;ll still be a huge technological success. Other cryptocurrencies can try their hand at scaling, but Bitcoin needs to be rock solid to the extent possible for all cryptocurrencies&amp;#x27; sake.</text></item></parent_chain><comment><author>PKop</author><text>No it doesn&amp;#x27;t. The purpose of Bitcoin is sound money.. A finite currency immune to governments&amp;#x27; and central banks&amp;#x27; desire to devalue currency for debt financing.&lt;p&gt;Bitcoin is more scarce and therefore better store of value than any fiat currency could ever be.&lt;p&gt;Do you not understand second layer solutions do not put your Bitcoin at risk? You commit to a payment channel which defaults to closing the channel according to original amounts when opened.. if the other party doesn&amp;#x27;t follow through. Again, your funds are not at risk so it&amp;#x27;s not like a bank, and there&amp;#x27;s no fractional reserve nor devaluing, so the SOV use case is preserved.&lt;p&gt;Not at all like current fiat money system.</text></comment>
<story><title>Did Bitcoin just prove it can&apos;t scale?</title><text>The past few days have shown what happens when many people attempt many transactions using Bitcoin. The network slowed to a crawl. Transaction prices went through the roof. And we still are at a point where only a tiny fraction of people are using Bitcoin, and only a tiny fraction of all financial transactions are using Bitcoin.&lt;p&gt;How is this expected to work with 7 billion people using it for every tiny financial transaction? I don&amp;#x27;t think it can.&lt;p&gt;I have owned BTC for 5 years and I am enjoying the rally, but with the high transaction fees, back log, and long transaction times, I wonder how well it can really work as a replacement for banks.&lt;p&gt;Am I wrong?</text></story><parent_chain><item><author>theWatcher37</author><text>This defeats the entire purpose of bitcoin. The goal is a decentralized currency that isn’t controlled by shady political interests, and can reasonably replace normal currency.&lt;p&gt;Why would you want Bank 2.0?</text></item><item><author>wildmusings</author><text>I’m not sold on Bitcoin but I don’t agree with your definition of what it needs to be successful. There is no reason that actual bitcoin end-users need to deal directly in bitcoin. If Bitcoin were to ever become a major currency, a big if, there would be financial institutions (banks) issuing instruments (physical or digital notes) backed by real bitcoins held by those institutions. Real bitcoin transactions would be mostly performed between such institutions, or anyone else willing to pay the higher transaction fees. Most people would have their needs perfectly served by relying on bitcoin banks, at least for performing frequent transactions. Though they might very well seek to hold large sums directly in BTC.</text></item><item><author>KirinDave</author><text>Bitcoin is a lot of things, and many of them interesting, but suggesting that ~4 t&amp;#x2F;s is impressive or &amp;quot;scaling&amp;quot; is an insult to kids in high school writing rails apps that can do 100x the volume.&lt;p&gt;We already know at least 2 obvious ways to improve the transaction flow rate of bitcoin in trustless ways, and many others are being proposed that do not also create energy arms races.&lt;p&gt;Please don&amp;#x27;t redefine success.</text></item><item><author>moduspol</author><text>Others here are touching on Bitcoin being like the &amp;quot;1.0&amp;quot; of cryptocurrency, but it&amp;#x27;s actually a lot more than that. In the public eye, it&amp;#x27;s a symbol of what cryptocurrencies can be.&lt;p&gt;You&amp;#x27;re suggesting Bitcoin just proved it can&amp;#x27;t scale, but it actually just proved it did--just not with transaction volume. The network continued to process transactions averaging one block every ten minutes exactly as it was built to do, despite the heavy load.&lt;p&gt;To put it differently: A different online payment system could have stopped accepting transactions, or run out of resources, allow transactions it shouldn&amp;#x27;t have, disallow ones it should, or something else terrible. But Bitcoin didn&amp;#x27;t. If you wanted into the next block, you&amp;#x27;d need to pay more, but that&amp;#x27;s (from a technical perspective) entirely by design.&lt;p&gt;What Bitcoin is proving is that it has clear and well-understood limits and continues to work well within them, and that&amp;#x27;s incredibly important for public perception. IMO, if Bitcoin&amp;#x27;s transaction capacity never scales, it&amp;#x27;ll still be a huge technological success. Other cryptocurrencies can try their hand at scaling, but Bitcoin needs to be rock solid to the extent possible for all cryptocurrencies&amp;#x27; sake.</text></item></parent_chain><comment><author>maehwasu</author><text>Bank 2.0 could also run its ledger of debts and credits on a public&amp;#x2F;easily auditable blockchain, and make a lot of guarantees that Bank 1.0 can&amp;#x27;t.</text></comment>