Topic: The Bitcoin has 'jumped the shark' (Read 2932 times)

High fees for Bitcoin transactions can be a big problem since this cheap fees is a major reason why people love Bitcoin. However, if in comparison to Paypal it is still competitive then maybe it can still be fine. I am more concerned of Bitcoin's falling value this week.

your thinking of it from the narrow ideal from the euro/american mindset.

40cents is only a few minutes minimum labour in developed countries.

but

40cents is HOURS of minimum labour in MANY developing countries.

being charged 2+ hours labour to buy groceries in any country is a laugh.. and if you think that is acceptable, then please go travel the world

its sure that nowdays the price and the bitcoin fees are turning into a pain but currently its still payable because we pay more in our local services and with bitcoin we actually getting a good profit + a good servic which has no comparison in the whole world. but soon it will be started to be neglated and bitcoin transactions will be smaller in compared with todays date.maybe we should think of some offchain transactions which can save some fees

about the utility of LN in regards to peoples false ideals of the fee's they expect.


anyone also notice how blockchain.info removed the "days destroyed" stat.
this is because if you analyse that stat against other stats, it reveals that people DONT on average do several transactions a day or week.

many peoples funds are used once every 5 days. some peoples funds sit for months and yes years. thus something like LN with a 10day n-lock is useless utility for these people who do 2 or less tx per channel period.

so dont expect "cheap" tx fee's as the norm because LN isnt designed for people that only do 2 or less tx's per LN channel period.

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next we have the CLTV which when confirmed(settled) stops funds from being respent for the CLTV period (laymans: much like banks/paypals 3-5business day delay on ''funds available", or like bitcoins blockrewards 100confirm maturity)

so people who do desire 'regular' spending wont want to have funds maturing for a few days.

however, LN have a scheme/plan for that too.

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an LN hub can circumvent the CLTV maturity by revoking the funds to a destination in the CSV revoke commitment to push the funds into a new LN channel. meaning an LN hub can lock peoples funds permanently into LN contracts.(laymens: bank chargeback/reclaim)

LN actually initially wanted to penalise users by taking all their funds to the LN hubs non multisig address(fraud penalty).. as the ultimate penalty.. but morally they should only use the CLTV and CSV features to reset a new LN contract* to then get the customer to agree a new honourable agreement of who owes what. suggesting that due to CLTV its better to just use LN than resettle again.
*https://github.com/bitcoin/bips/blob/master/bip-0112.mediawiki#lightning-network

so LN hubs can actually hold funds to ransom and even if you broadcast your own copy, they can CSV revoke to honourable put funds back into a new LN agreement.. or maliciously allow the hub owner to take the funds into his own private ownership (non multisig).

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yes i left the best for last because i know people are itching to say they will save on costs if they need to do more than 2 transactions per channel period...

lastly there are the internal penalty fee's too.
LN have come up with many penalties. such as, if there is a multihop transaction happening.
you can be penalised for not promptly agreeing to it, as it would cause a extra delay on the other commitments agreements.
you can be penalised for not signing your agreement
you can be penalised for attempting to spam/DDoS the hub with excess data
you can be penalised for sending the wrong agreements to be signed by the hub

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they actually envisioned a 0.006btc fee as a minimum entry into a channel ($4-$7 at this weeks volatile price) to cover their expectant fee's over time. yet again rules out micro payments of developing countries where $4 is 2weeks wage (cuba, georgia, etc).. $4 is 1 week(Kyrgyzstan, gambia, ethiopia, etc)

imagine having to deposit a week or 2 wage just to cover fee's for a 10 day lock. before you factor in how much you would deposit ontop to actually spend.

the problem with the devs, both calculating the onchain fee war and the LN fee penalty acceptability. is they are thinking with a western world mindset of being only slightly cheaper than paypals 20-30cent fee. before the devs would even consider lowering their 'spam' limiter down. they should spend a week outside their basements and travel the world and experience currency usage outside of the corporate america setting.

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overall summary
LN is not the ultimate scaling solution. it is and should be just a niche/side voluntary service much like third party exchanges are.. for things like gamblers, faucet raiders and day traders who usually spam the blockchain frequently.
however malicious spammer who want to spam the blockchain will avoid LN because LN defeats their malicious purpose. thus LN wont mitigate intentional spammers.
also infrequent bitcoin users (under a few times a week) wont need/want LN due to the settlement delays and the costs of setting up/settling would be more then just paying someone direct onchain infrequently

Bitcoin : A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. Did I miss any of this, or are Bitcoin still a peer-to-peer version of electronic cash? The only thing that has changed, is the fact that 3rd party services are more commonly used and not directly as the white paper stipulated.

So we did lose the plot, when we have to work through other financial institutions to make transactions with Bitcoin. These tx's are still relatively cheap, but once you add the fees charged by these services, it becomes expensive.

Segwit will never be activated , Chinese Mining Pools are blocking it. 

 

You don’t really think that, do you? Let compare other popular worlwide services like as Moneygram and will see for $10 from Europe to USA the estimated fees with bank account or credit/debit card are $5.99. The same even though much more cheaper with western union where the fees are $0.99 and payment day varies from 2-6 business days. Of course I don't advocate that I feel happy with these transactions fees but I am confident in the future after segwit activation and LN networks for micro-payments we will have better fees and confirmation times.

LTC & Doge are still faster & cheaper to send. 

 

In light of the current prices, the Bitcoin has not 'jumped the shark'. The price of bitcoin has drastically dropped from the $1,000 levels that when you compute for fees you would be paying $0.2-$-0.4 per transaction. Now we're back to same fees but is lesser when converted to dollars. We would however reach the problem again once the prices comes back up.

Exactly.  Why would I spend 2 bucks on a beer using bitcoin when it could quite possibly be worth 4 bucks in years or even months time?. 

There's no suitable altcoin yet but that is why there will be soon enough.

Altcoins have value thanks to their ability for you to trade them for Bitcoins, when enough people realise the value of holding Bitcoin as a speculative asset another coin will materialise as a way to spend their Bitcoin holdings in a more user-friendly fashion than on the Bitcoin blockchain or via transferring to fiat.  Like in times before the credit or atm card, this will enable you to have the immediacy and convenience advantage (like cash) with the sacrifice of security (bank vault or transfer).  It is quite possible that there will be several altcoins that perform this function and a merchant will preferentially price goods denominated in their currency of preference.

hmm. i ain't so sure about that. that would put a lot of small time node operators out of the game. someone reported an 80gb upload for one day last week. that's far, far more than many people could get away with in a whole month. not everyone involved in bitcoin lives 2 metres away from their cabinet in south korea.

Bitcoin was actually built by its creator Satoshi to be a currency.  Then Greg Maxwell came along and decided to convert the system into a settlement platform instead.  He forced the network fees up >>1000% to drive traffic into his Blockstream owned private lightning network.  The whole fucking thing is a scam.

8MB blocks don't cause 'centralization'.  That is total bullshit. 

There is no need to provide for nodes with very horrible bandwidth.  People all over the world are streaming bandwidth heavy movies all day long. 8MB is nothing.  If we lose a few nodes on 1200 baud modems, it doesn't amount to 'centralization'.

Maybe not POT or MAID, but definitely Doge or Steem. Bitcoin isn't built to be used as a currency, there is the hoarding aspect thanks to limited supply, and the transaction delay aspect and the high fees aspect. At some point an alt will make it to the big time, only one has to succeed out of the thousands, and then we're in a new chapter for cryptocurrency.

I'll take any altcoin that I can exchange easily as payment...maybe at a slight mark-up as a convenience fee.

Money is money...it all spends about the same.

And this 'exchange' is owned by Blockstream - who decided not to charge any fee?  Yeah, right.  And pigs fly out of my ass too.

Following that argument. Do you think every other guy would be willing to accept your POT Coin, your MAID Coin, your XRP Coin, your REP coin, your whatever altcoin you have right now. I don't think so. People will not trust altcoins and would prefer to deal with bitcoins. If you offer coins other than BTC, I don't think it will get you so far.

Yes indeed. Like if you are dealing with amounts that would result to the fees being less than 1%. So that would mean, 0.40/1%, so any deal beyond $40 is acceptable and anything below that would result to a fee higher than 1%. To keep it low, we all must deal with anyone using bitcoins above $40. Which is impractical.

That's what altcoins are for.  They are your checking account, Bitcoin your savings account. 

They are not comparing to VISA outright, they are just pointing out that the fees are really turn to a problem and basically it will destroy one of the very good features of bitcoins, which is having low fees. With fees almost the same with Visa there would be lesser reason why we should use bitcoins. $0.40 is small if you are indeed sending thousands. What if it's just a few dollars, like $1 to $5? Then that fee will be really relevant.

Anyone who is still comparing Bitcoin to VISA is out of their mind.  There are plenty of altcoins we can change our Bitcoin for that have superior qualities to VISA and Bitcoin for everyday transactions.  

This is the new gold and at $0.40 to send thousands near instantaneously anywhere on the planet free of censorship or government control it is an absolute steal.