By CCN: Let me start by saying I’m undecided on the issue of blockchain scaling. I think both camps make valid points. The day that Bitcoin Cash launched was the logical resolution of a drawn-out war which would never have ended otherwise.
Tone Vays Can’t Make Up His Mind
That being said, I watched this debate between Roger Ver, one of the earliest angel investors in bitcoin, and Tone Vays, a bitcoin personality, and I felt like I was watching a professor debate a teenager.
Ver may be a hyperactive personality who occasionally alludes to Bitcoin Cash as being “a version of Bitcoin” (a semi-acceptable stance given that they largely share the same transaction history and most properties), but he does know what he’s talking about.
On the other hand, Vays claimed that he uses Bitcoin every day and frequently pays just five cents to send transactions.
This doesn’t stand up to reality.
You will pay less than a cent to send a transaction on Bitcoin Cash. It’s one way to save money when you’re exiting an exchange. In a previous era, you could use Litecoin for the same purpose. But in a previous era, average fees on Bitcoin did not range over $1.
When we say “average fees” here, we refer to fees spent to get a transaction included as intended – as soon as possible. Nobody uses digital currency because they want the recipient to wait hours or days to receive it. The instant settlement of crypto payments is one of many value propositions.
Scaling Is Not A Religion
Vays fell back on circular logic.
First, he says fees were not as high as Roger Ver claims. In this he is correct. You don’t have to pay $3 to send a BTC transaction in a reasonable amount of time.
“If you really need it on-chain, you will have to pay a higher fee. Which, actually, I don’t mind paying a 20-cent fee. I like supporting the miners which are keeping our system secure.”
First of all, 20-cents is less than the average fee at press time. The average transaction fee over the past 24-hours was around 50,000 Satoshi, or $4 at current prices.
But anyway, we are to expect most users to want to “support the miners”? What a joke. Honestly.
This is a bankrupt argument and also circular in that it undermines the last 60 seconds or so of his argument.
Vays had just said that we will be using Lightning Network for everything, the purpose of which is to reduce fees and allow for more transactions. Miners make less in the long run in a scenario where Lightning Network is supreme, less than they would if more on-chain transactions were allowed.
Decentralization Still Matters, Bro
Then another core issue of Bitcoin economics comes up: sovereignty.
The only way to be truly sovereign in the Lightning Network is to operate your own node. Not a particularly easy task. It’s certainly not realistic to expect there ever to be millions of personal nodes operated by millions of personal users.
Instead, what you will have are a few major service providers.
If you are okay with this, that’s fine. But Ver makes an obvious point: the SPV wallet system currently used by Bitcoin Cash and Bitcoin, which was for the longest time the best way to run a lightweight wallet because you would own your keys while not having to own a copy of the Bitcoin blockchain, is by far more decentralized than a Lightning-centric system.
I have to say that most Bitcoin Cash proponents I’ve spoken with, including Honest.cash founder Adrian Barwicki, accept that there will one day come a need for second-layer scaling of Bitcoin Cash. The main contention is that we should not artificially force that to happen by having blocks that are arguably smaller than they have to be.
Luke-Jr recently made the case for small blocks at the Magical Crypto Conference, and his arguments are at least sound if lacking in realist strategy.
Remember, kids, friends don’t let friends become dogmatic zealots.
Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN.
Published at Sat, 25 May 2019 21:06:24 +0000