Why has Bitcoin failed?
It has failed because the community has failed. What was meant to be a new, decentralised form of money that lacked “systemically important institutions” and “too big to fail” has become something even worse: a system completely controlled by just a handful of people. Worse still, the network is on the brink of technical collapse. The mechanisms that should have prevented this outcome have broken down, and as a result there’s no longer much reason to think Bitcoin can actually be better than the existing financial system.
Why has the capacity limit not been raised?
Because the block chain is controlled by Chinese miners, just two of whom control more than 50% of the hash power. At a recent conference over 95% of hashing power was controlled by a handful of guys sitting on a single stage. The miners are not allowing the block chain to grow.
I said from the start that the PoW model was flawed, and centralization in the form of mining/transaction authentication was going to be Bitcoins future.
In the long run, it would've been just as centralized as the paper FIAT system we see today.
There's plenty of crypto's out there that improve upon the PoW algorithm, some better than others, but most...all the same.
To quote myself 2 years ago (NEM thread which is now closed):
PoW is no more decentralized than FIAT, in fact it's worse because those with the influence are more anonymous and just as powerful.
PoS has the capacity to be just as centralized - poor distributed IPO, or other such tatics seen with the MaidSafe IPO. NEM so far has been a step in the right direction.
