Topic: No mass adoption because of the One-size-fits-all bitcoin (Read 1605 times)

Everyone keep mentioning these sidechains like a miracle that will save us from all! This problem that we have, sidechains will solve it, that problem that we might encounter, sidechains will solve it.

I sure hope that will be possible. I guess we will see everything in the near future!

Do not understand what OP want to say, mass adoption is obviously happening if you consider the price was basically in a down trend during last 2 years

And money is a one-size-fits-all thing, just like USD is suitable for any kind of transaction, so does bitcoin

The benefits of decentralized money is clear, no single entity (ie government) have control over your money. Maybe you dont remember but Greek government used capital control to say how many Euros can be cashout daily by every person. The real and anytime ready to be spend Bitcoins is true benefit over fiat aka debt based money. The majority of current and probably next generation will probably not appreciate decentralized money, but this might not be the case forever...

It's market analysis of a technical solution. That's why I think it fits better not to Economics or Technical, but to General section. Maybe I should put a link to this thread in Economics section?

You are right. Making bitcoin better for one case would make it worse for some other cases. That's why we need several forms of Bitcoins, each one is polished for its own use case, with ability to convert these forms into each other, like $100 bills can be converted to dimes and back. Sidechains would let us to do it.

Then you have created the thread in the wrong section. It would be more fitting in Economics if it is about the market. I will reply to the rest soon by updating this post.

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Update:
Because it is a mix it is hard to find the most suitable section for it (threads of similar character appear from time to time); I'm not really sure. You could if you wanted to.

Lightning Network is important. But it is for resolving other problem: scalability, to increase it on many orders of magnitude. It is not needed yet and if the problem I was discussing won't be solved, it will never be needed. If we won't be able to conquer new niche markets, we'll never need more than 8Mb blocks.  As for other solutions, I'm not aware of them. There are some projects aimed at some specific niches, but there is no project that would enable to attack them all. The sidechain is the only one, there is nothing to compare it with.

I believe that transaction volume in USD prices is the best measure to see bitcoin market penetration. People use bitcoins to transfer value. If price of bitcoins halves, they would need twice as much of bitcoins to transfer the same value. That's why number of bitcoin transacted is bad measure of market penetration. The amount of transaction is even worse in this respect, since the same value can be send by one transacton or by 1000 transactions. USD volume is the best measure. (I agree that inflation-adjusted USD would be better, but so slightly better, that we would need a magnifying glass to see the difference between adjusted and non-adjusted graphs. Because the graph shows growth in many orders of magnitude, while $ value have changed on some % for the period). When bitcoin was gaining new markets (i.e. new groups of people were switching from fiat transactions to btc transactions) we saw the USD volume was jumping new step on the staircase. There were six steps so far. I cannot exactly identify for which market which step was responsible, but I can name following markets: drug trade (thanks Silkroad), gambling (thanks SatoshiDice), trading (thanks Gox), trading in China (thanks Chinese exchanges). Each of these markets gave us usd transaction growth in range of order of magnitude. But for the last 2 years nothing of the kind happens. There is some growth, but nothing comparable to the previous staircase. We have stopped gaining new niche markets, and to resume it, we have to change Bitcoin somehow. Sidechains is the only solution of this problem I'm aware of.

The major benefit of fiat is network effect. You can use USD at any place over whole country. Everybody accept them. While to earn or spend, say, Mongolian Tughrik in New York you would have a lot of hassle. The same is true about bitcoin. To justify this hassle, you would need some really good benefit of bitcoin over fiat.

You already have bitcoin. You are old market. While we are talking about entering new markets. So we need to find a new market, i.e. a category of people that don't use Bitcoin now and change bitcoin in such a way that they would want to use it. If this would work, we should repeat it again, for some other and larger markets. Or we can introduce sidechains and do it simultaneously, for many markets at once, in a hope that at least one of them would fire. It would improve chances and speed of the mainstream adoption.
 
You not only want it, you are currently using at least 3 non-competing currencies. I mean 3 forms of dollars: change, bills, electronic accounts. Each form is good for some purposes, but bad for others. Dimes are not convenient to buy a car with, but are good to pay to a street musician. Electronic account is good to automatically pay rent/mortgage, but not good to pay "under the table". And so on. That's why we have those different "avatars" of dollar. Sidechains will create the same system for bitcoin, only better one: more forms of bitcoin, better tailored for each purpose.  

You are right. I assumed everybody here knows it. OK, for the purpose of this discussion it's enough to know what sidechain would let us to develop new forms of bitcoin, interchangeable into each other, like physical 100-dollar bills can be always changed to dimes and back, without losing it's value. There is no limit to number and variety of possible bitcoin forms, so they can be precisely tailored to each market. The switch between them can be handled by your wallet, you may not even need to know about it. You just take from your wallet item you currently need, be it a dime or $1000 bill. When needed, the wallet will break your $1000 bill into dimes or merge the dimes back or convert them to any other form you would need.

There are already technical threads, dedicated to it. This thread is about market analysis. My goal was to demonstrate that to significantly increase bitcoin's market share we need to transform it into an array of non-competing currencies. Sidechains is the only project aimed at it.

Anyway, I'm glad that our positions are closer than I thought.

OP I see what you are trying to say. And I somewhat agree with you. We do need to clarify different use cases and to polish Bitcoin for those use cases that we find them suitable. But I am not for bringing any hasty decisions. For example, if we polish Bitcoin for black market activities, we have just closed ourselves 3 other use cases on the other side.

I still think that we should be conservative and keep developing in conservative way until we don't see where is this boat headed to in the next year or two. There are some people and some devs that claim that everything is very develop able and doable, so let's see this as well. It takes time to change people's habits, especially when it comes to their finance usage.

Then I think we will still have enough time to make such a huge decisions.

In fact, early email was pretty slow, when you had to deliver over a chain over uucp-relays etc. It could literally take days for an email to reach its recipient. Fax, on the other hand, was pretty much instant. At the same time, fax was not for the average Joe, but email wasn't either.
But, quick email and fax were available to businesses. And boy, did they use it.
Now, about bitcoin, it might not necessarily be available to your average Joe and also not offer him much of a benefit.

But for the business user, bitcoin ist pretty much the fax / mail for money.

Yes, money is important. But people already have money system. They need some very strong reasons to discard it and switch to something else. What benefits this "something else" would give to them? Those benefits should be really big, to overcome tremendous inertia and network effect of the current money system. Email did have such a benefit: it delivered mail thousand times faster. What thousand-fold benefit over dollar bitcoin has? For average Joe? In an area that really matters to Joe, like speed of mail delivery mattered?

I agree with this.

What I am trying to say is, what potentials this brings are uttely unfathomable just like when the ENIAC went online.  If you told someone that it would be the size of my hand and I could watch COLOUR videos on it the entire room would burst into laughter.

one was correct here, about portraying bitcoin as a next natural step among the technology changes in the last century or so

bitcoin can be pictured as the natural step of money system with its decentralization "feature"

but this also mean that there will be an evolution of bitcoin in the future...

Okay nothing more than the TV, radio, phone, take your pick of items.  It wasn't suppose to be specific about the fax machine.
You just 100% proved my point......... How can you not see that..

ENICA created in 1946... Krugman in the 1990s... about FIFTY, FIFTY, FIVE ZERO years later says that...
Soooooooooooooooooooooooooooo how am i wrong?  
I added 6 as in 2000 people still had little idea how big it was going to be, change it to 50 if that floats your boat.

No one knew in 1946 what the ENIAC was going to become.  To even suggest someone thought you would have one in your pocket is ludicrous.

The source?!?!

Why is a source needed.. you guys can not possibly be suggesting the creators / users of the ENIAC knew computers would change the planet this much.  You've got to be joking.

There is no need for a killer application for bitcoin.

In fact, bitcoin itself is the killer application for the internet.
What was email? Just communication.
What was the web? Just media.
What's bitcoin? Money.
What is the most important thing* in the lives of billions of people on this planet?
Communication?
Media?
Money.



* well, there are other things that might be more important than money. Work. Food. Health. But we have yet to find ways to leverage the internet for them.

At least get your quote correct. Krugman said that about the Internet. In, like, the 90s

This is a total lie. Bitcoin is gaining new markets as fast as it's losing them. That's why your graph line isn't moving like you want it to.

The great thing about making claims is anyone can do it and they require zero facts! Awesome post!

Fact? Where did you read this? Provide the source.

Bitcoin is not about discounts.

One has to be really special to support something like that.

Just going to Ignore the fact that for 56 YEARS computers where thought of never having a greater impact than the fax machine..

FIFTY SIX YEARS

With possibly better I meant that you should explain why we should focus on sidechains, but not for something like Lightning Network (a single example). In order to establish a strong thread you should have listed out potential solutions and argued why sidechains are better. That's why I was aiming at.
1,2,4,5,8,9 : Yes.
3. I don't completely agree with you. This chart is based on the USD price at that time (right?), and thus it would not clearly show if there is an increase of volume or not. The amount of Bitcoin transacted daily would show it a bit better. The amount of transactions per day shows an even better picture.
6. What are the benefits of fiat exactly? The benefits of Bitcoin might not justify it for the average person, but I'm not an average person and thus disagree (for myself, not in general).
7. Somewhat.
10. If we aren't careful, yes.
11. Possibly.
12. They could, yes.
13. I don't want an array of currencies.

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However, this still doesn't present sidechains (which are still experimental) as a solution. You haven't even explained what a sidechain is (for those that do not know). I'm asking for more of a technical analysis (if you can provide one).