Current Events > Bittcoin: how is a $20 fee / transaction scalable for any currency?

(+) Yeah! (+)

Every time you make a transaction involving Bitcoin, you have to pay a fee to the network to process that transaction, right? And the transaction processing gets more and more complex with each transaction, correct?

How do folks who support Bitcoin envision this continuing to be feasable? Literally nobody is going to want to pay $20 (or more as time goes on) to complete a transaction. It seems BTC is only feasible to exchange large quantities of money, which is not something people do on a regular basis.

edit: this is part of why Steam stopped supporting it. It's not reasonable.
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This is why I'm afraid to put money into this - especially with Steam dropping them.
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maybe it will strictly be an investment thing, like gold? i mean, gold has considerable value and people trade it / invest in it, but it's not like people go around exchanging gold as a common currency. like, if i walked into the grocery store and tried paying with a piece of gold they would just laugh at me.
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its all about potential

Ballstopshere posted...

its all about potential

potential for what, though? When BTC first came out I got the impression people were going to use it as a common currency for internet purchases / etc. that seems unlikely now, given the skyrocketing transaction fees.

i admittedly have no idea what this "lightning network" is or what it means WRT this, though.
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cryptocurrency potential

i dunno how cryptocurrency is gonna work but people are buying into it

although i violate a popular investment adage "invest in what you know", i just don't care

@clearaflagrantj you seem to know a lot about crypto, can you possibly shed some light?
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Bitcoin itself is a fad, but cryptocurrency and the blockchain technology have amazing potential.
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I don't remember what coin it is (Litecoin?) essentially was created to be the "silver" to Bitcoin's "gold", where you use Litecoin to do most of your transactions and the transfer between Litecoin and Bitcoin is easy.

That's just a rough recollection though.
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Giant_Aspirin posted...

Every time you make a transaction involving Bitcoin, you have to pay a fee to the network to process that transaction, right? And the transaction processing gets more and more complex with each transaction, correct?

How do folks who support Bitcoin envision this continuing to be feasable? Literally nobody is going to want to pay $20 (or more as time goes on) to complete a transaction. It seems BTC is only feasible to exchange large quantities of money, which is not something people do on a regular basis.

edit: this is part of why Steam stopped supporting it. It's not reasonable.

the $20 fee is for the exchange.

moving bitcoin around is free if you do it yourself, you just have to accept risks in doing so.
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The Admiral posted...

but cryptocurrency and the blockchain technology have amazing potential.

do you mean as a 'regular' currency as in something we would use to exchange goods and services? or potential as investment vehicles?
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Giant_Aspirin posted...

The Admiral posted...

but cryptocurrency and the blockchain technology have amazing potential.

do you mean as a 'regular' currency as in something we would use to exchange goods and services? or potential as investment vehicles?

Yeah. Crypto actually has so much potential, and not even 1% of that is being used by Bitcoin. We're at the Windows 3.1 version of crypto as a means of exchange.
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Giant_Aspirin posted...

or potential as investment vehicles?

See we are in a weird time now. If Bitcoins didn't hypothetically have value as a currency, they would be a scam. Let's use your comparison to gold.

Imagine someone find a mine filled with unique but bland rocks. They say "Hey everyone, we're going to start pretending these rocks are worth something. If you invest now, we'll give you some of the rocks that we've already dug up. Our digging machine is coin operated, and we've set it up so the deeper it goes, the more coins it expects. That means that if you join now it's way cheaper than if you want some rocks in the future!"

Those rocks don't have any purpose and they are bland, but some people start paying the digging machine and then people see how expensive the digging machine is getting and start to put money in before the rocks get prohibitively expensive.

And now imagine 100 people see that and open their own mines to do the same thing with their own bland rocks.

That's what "Cryptocurrency without currency implications" is.
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Giant_Aspirin posted...

@clearaflagrantj you seem to know a lot about crypto, can you possibly shed some light?

People aren't investing in bitcoin so they can buy a coffee, they see it is an investment vehicle that is growing 1000% every year. Nobody gives a shit about a $20 fee if their $10,000 investment turns into $500,000 in two years. Bitcoin is currently surging because:

1. CBOE and CME futures are coming out the next two weeks

2. There was a successful test of the lightning network, which is a great sign that the scalability issue will be resolved

3. Currently there is no bcash or China FUD, there has been no real negative news to hurt Bitcoin

Giant_Aspirin posted...

@clearaflagrantj you seem to know a lot about crypto, can you possibly shed some light?

he doesn't actually understand anything about crypto. i've brought up the scalability issues multiple times and he's never understood what scalability is or why it's about to tear bitcoin a brand new ass hole
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clearaflagrantj posted...

2. There was a successful test of the lightning network, which is a great sign that the scalability issue will be resolved

mitigated

nowhere near resolved
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FLUFFYGERM posted...

Giant_Aspirin posted...

@clearaflagrantj you seem to know a lot about crypto, can you possibly shed some light?

he doesn't actually understand anything about crypto. i've brought up the scalability issues multiple times and he's never understood what scalability is or why it's about to tear bitcoin a brand new ass hole

can you explain scalability to me
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FLUFFYGERM posted...

clearaflagrantj posted...

2. There was a successful test of the lightning network, which is a great sign that the scalability issue will be resolved

mitigated

nowhere near resolved

Keep spreading the FUD

lmfao wait wait wait holy shit you have to pay $20 just to use this imaginary currency?

LMFAOOOOOO
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On_The_Edge posted...

FLUFFYGERM posted...

Giant_Aspirin posted...

@clearaflagrantj you seem to know a lot about crypto, can you possibly shed some light?

he doesn't actually understand anything about crypto. i've brought up the scalability issues multiple times and he's never understood what scalability is or why it's about to tear bitcoin a brand new ass hole

can you explain scalability to me

The blockchain is a huge data structure. The volume of data is increasing at a huge rate. As the blockchain gets bigger and bigger, validating additional transactions takes longer and consumes more electricity.

This means that over time, fees go up and transactions take longer. Because of how fast cryptocurrency is growing, we're going to hit that wall before there's a real solution to it. This is because the size of data will get so huge that transacting with Bitcoin or other currencies like it will be too expensive in terms of time/electricity to be of value to anyone.

When that happens the value of each token will plummet.
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guys every time you quote that post where i mentioned clearflagrant, he gets another notification. it would be cool if you could remove the @ when you quote that post in the future.
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FLUFFYGERM posted...

On_The_Edge posted...

FLUFFYGERM posted...

Giant_Aspirin posted...

@clearaflagrantj you seem to know a lot about crypto, can you possibly shed some light?

he doesn't actually understand anything about crypto. i've brought up the scalability issues multiple times and he's never understood what scalability is or why it's about to tear bitcoin a brand new ass hole

can you explain scalability to me

The blockchain is a huge data structure. The volume of data is increasing at a huge rate. As the blockchain gets bigger and bigger, validating additional transactions takes longer and consumes more electricity.

This means that over time, fees go up and transactions take longer. Because of how fast cryptocurrency is growing, we're going to hit that wall before there's a real solution to it. This is because the size of data will get so huge that transacting with Bitcoin or other currencies like it will be too expensive in terms of time/electricity to be of value to anyone.

When that happens the value of each token will plummet.

I understand that in principle but why does it take so much power to make a transaction? Is the blockchain really that big of a data structure? How is it any worse than say, seeding a movie file as a torrent? Are there no real solutions to that problem?

Also, does the problem apply to making bitcoin transactions as such, converting them to USD, or both?
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Coinbase doesn't have a $20 fee, but the fee is a percentage of the transaction. I put in 750 and the fee was 28. I put in 100 and the fee was like 5.
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On_The_Edge posted...

Is the blockchain really that big of a data structure?

It's currently 140 GB
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Anteaterking posted...

On_The_Edge posted...

Is the blockchain really that big of a data structure?

It's currently 140 GB

But how much of that is involved in transferring a particular amount of currency? Do you need to transfer the entire blockchain when you make a transaction?
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On_The_Edge posted...

Are there no real solutions to that problem?

my limited understanding is that this "Lightning Network" aims to solve or mitigate that very problem and just completed its first test recently.
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On_The_Edge posted...

I understand that in principle but why does it take so much power to make a transaction? Is the blockchain really that big of a data structure? How is it any worse than say, seeding a movie file as a torrent? Are there no real solutions to that problem?

Also, does the problem apply to making bitcoin transactions as such, converting them to USD, or both?

It is that big of a data structure and it needs multiple verifications before it's considered a valid transaction. Every single transaction has to be verified against the entire blockchain by many other people, more than once. The verification algorithms are computationally intense and are mostly run on GPUs and specialized machines that use a lot of electricity to run.

The solutions to the problem all involve more hardware and more electricity. Or to change your verification process to a different algorithm entirely, which is too late for Bitcoin imo.
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On_The_Edge posted...

But how much of that is involved in transferring a particular amount of currency? Do you need to transfer the entire blockchain when you make a transaction?

If you don't trust anyone, you need the whole blockchain.

That's not really what causes the electricity concerns Proud is talking about though. In order to build the next block of the chain, miners are putting in lots of computing power to solve a certain hash. By design that hash gets more and more difficult to solve, so it takes more and more electricity at each step.

Each block can contain a certain number of transactions (which is also why generally speaking if you bought something with bitcoin today it could technically take some time to actually get into a useable state by the party on the other end).
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Anteaterking posted...

That's not really what causes the electricity concerns Proud is talking about though. In order to build the next block of the chain, miners are putting in lots of computing power to solve a certain hash. By design that hash gets more and more difficult to solve, so it takes more and more electricity at each step.

Yeah so that's the computationally expensive part of the algorithm. The difficulty is designed to increase artificially so that mining gets more demanding over time. This is to boost the price of the currency. The difficulty is directly correlated to the size of the blockchain and the number of transactions happening on the network. It's also directly correlated to the number of people mining.
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IOTA has zero fees and its faster than Bitcoin. Market cap is at an all time high. Just imagine all the potential.

IOTA is only in two exchanges. When the next exchange integrates IOTA , IOTA will explode.
IOTA is under the radar and mainstream media haven't caught on yet. just wait.

Oh yeah. ZERO FEES with super fast transactions. Bitcoin is so 2009. Welcome to 2017.
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cerealbox760 posted...

IOTA has zero fees and its faster than Bitcoin. Market cap is at an all time high. Just imagine all the potential.

IOTA is only in two exchanges. When the next exchange integrates IOTA , IOTA will explode.
IOTA is under the radar and mainstream media haven't caught on yet. just wait.

Oh yeah. ZERO FEES with super fast transactions. Bitcoin is so 2009. Welcome to 2017.

Where do I go to buy IOTA if I wanted to?
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On_The_Edge posted...

cerealbox760 posted...

IOTA has zero fees and its faster than Bitcoin. Market cap is at an all time high. Just imagine all the potential.

IOTA is only in two exchanges. When the next exchange integrates IOTA , IOTA will explode.
IOTA is under the radar and mainstream media haven't caught on yet. just wait.

Oh yeah. ZERO FEES with super fast transactions. Bitcoin is so 2009. Welcome to 2017.

Where do I go to buy IOTA if I wanted to?

Binance. IOTA is finishing a nasty dip. Prices are getting cheaper stabilizing for now. I would hop on asap. IOTA wont get any cheaper than $3
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IOTA is garbage. Available only on shitty exchanges, has way too many circulating tokens (which means each token is way too overvalued)
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