
Stress Test Recap: Bitcoin - prostoalex
http://www.reddit.com/r/Bitcoin/comments/37ub2k/stress_test_recap/
======
sarahj
I remember reading about Bitcoin a couple of years ago and expressing
disbelief that many of the major advantages being heralded were little more
than fantasy, these were:

* Micro-transactions.

* Replacing practically everything related to money in developing countries.

From this thread it is clear that many of those dreams are still very much
dreams - the ever growing energy and resource requirements to participate
significantly in the network is staggering, the amount of storage required for
the blockchain is a burden to even tech-aware users (unless of course one
would want to trust a third party...), and now it would seem that there are
minimum bandwidth requirements which sit outside what is possible in even
modest parts of the USA - impossible to achieve in places where the main link
to the internet is a satellite.

If I was feeling particularly optimistic I would say that Bitcoin has been
shown to be unscalable in it's current form. Further, the network itself tends
towards centralization because of the ever growing storage, processing and
bandwidth requirements.

I look forward to seeing where the future of crypocurrencies leads us- there
is so much promise.

~~~
brighton36
You wouldn't believe how clunky the Internet was when it first started. This
stress test is fairly minor compared to the problems bitcoin had in 2011 and
2012. With time, the blockchain will improve. Just like the Internet. You
should look into the Lightning Network paper, there's no shortages of
solutions in bitcoin. Meanwhile, traditional financial platforms have been
stagnant for decades.

~~~
aliakhtar
In 2000, about 5-6 years after the internet was easily available to public, I
had a dial up connection, email, IM, a web browser, etc in the middle-of-
nowhere town in Pakistan where I was born. Bitcoin has been out for close to
6-7 years and does not even come close to the maturity / adoption of internet.

~~~
AnonNo15
Except Internet was in development since 1969 by the time it became available
to public.

Bitcoin whitepaper was released in 2008. Before that even the concept of
cryptocurrency hardly existed.

~~~
aliakhtar
The technologies used in Bitcoin have also been in development for several
decades, and by 1998 the first cryptocurrency was already released, according
to a quick search on wikipedia.

~~~
AnonNo15
Note the difference - "technologies used in Bitcoin were in development for X
years" vs. "Internet as a whole concept of network of network was in
development for Y years".

~~~
aliakhtar
No, the internet as we perceive it today, as a global network, didn't exist
back in 1969. The technologies we use in internet today were developed back
then, though. Just like they were for bitcoin (cryptography, merkle trees,
etc)

------
themgt
It's become beyond obvious that existing Bitcoin blockchain technology has no
real ability to scale, function as a long-term store of value, or withstand
even moderate attacks by bad actors.

The hype has gotten in the way of building something that makes sense, and the
continued belief in "Bitcoin" as the answer rather than some mew - perhaps
maybe with a lot of further innovation - blockchain inspired tech, seems
mostly tied up in the "investors" left who spent real dollars for the bits
they're now watching depreciate, and can't bring themselves to admit an
interesting, failed technology's digital coins are worth about as much as old
Pokemon trading cards.

~~~
ghshephard
I use bitcoin, a lot. I use it primarily to move money between countries
quickly, and inexpensively. Doing a bank transfer takes 3 days, and a $20
cable fee. Using Bitcoin is pretty much instant, and costs a few pennies.

I've been using it for about 9 months, and I've yet to run into any snags. If
Bitcoin performed exactly as it does today, from now on, I couldn't be any
happier.

~~~
cherioo
How do you do that? Last time I checked major bitcoin exchanges takes several
to withdraw money. Coinbase has a instant buy/sell but I thought that only
works in US. Also, does it really cost pennies? Do you really lose nothing
going from fiat to bitcoin to fiat?

~~~
ghshephard
You are right that I lose 1.9% fee (coinhacko) purchasing bitcoin. Would be
great to see more competition there. xfers is pretty instant in singapore with
a FAST transfer from the local banks.

The bitcoin transfer itself is pennies, but the challenge is getting local
currency into bitcoin for a small amount of money. Though - the spread on
simply buying US currency is pretty big as well.

------
patio11
Quick mental math: 2.5k transactions or so in a block, 3 cents each for
transaction fee means that it costs $75 or so to fill up a block with
economically irrelevant transactions (i.e. moving money from one of your
pockets to the other). This means you can degrade the performance of the
Bitcoin network for about $10k per day.

You can probably optimize that down to $3~4k or so by being smarter about the
transactions you're DDOSing with. This is left as an exercise for the reader.

~~~
stream_fusion
An argument behind not increasing the block size, is that miners can price-
ration the inclusion of transactions in blocks.

During periods of high network contention, an ordinary user can include a
higher-fee to prioritize their transactions.

Correspondingly, the cost for attacking the network using spurious
transactions will increase.

------
natrius
There are lots of uninformed claims here about Bitcoin's scalability. If it's
a topic you're interested in, you should do some reading on your own. In
particular, the Lightning Network proposal is a promising approach to
dramatically increase the number of transactions that can occur trustlessly,
but without having to put each transaction on the blockchain.

[http://lightning.network/](http://lightning.network/)

~~~
davidgerard
It has the unfortunate problem that, like sidechains, it doesn't exist.

We already have altcoins. This might be an actually innovative altcoin. But
it's not really going to be Bitcoin.

------
tedunangst
Doesn't this kind of put a dent in the whole micro transaction argument? Once
we hit peak Bitcoin, if I want to tip you a penny for your HN comment, I'm not
going to pay a nickel in transaction fees to do so.

~~~
nkuttler
Bitcoin was not designed for microtransactions. Whoever told you that was
wrong.

~~~
davidgerard
Red herring: Bitcoin was not particularly designed for any use case at all.
The thing in the white paper is the cardboard-and-string proof of concept that
something like Bitcoin could exist at all, and the white paper talks about
improving the protocol in due course. Of course, nobody did.

It is, however, true that microtransactions were _heavily touted_ by Bitcoin
advocates, until of course it became blindingly obvious that Bitcoin didn't
scale.

~~~
hybridsole
Bitcoin can still allow for microtipping using something like ChangeTip. These
third party services can handle millions of transactions and only needs the
blockchain when a user loads/withdraws from their wallet.

Likewise if there was a ubiquitous browser plugin to micropay bloggers for
access to their articles and it was compatible with WP, Tumblr, etc, users
could microtip to their hearts content and only need to reload once month via
the blockchain.

~~~
dllthomas
That all sounds precisely as doable if you replace bitcoin with dollars.

------
dogecoinbase
The logical next step, of course, is miners themselves flooding the network in
order to drive up transaction fees.

~~~
kanzure
> The logical next step, of course, is miners themselves flooding the network
> in order to drive up transaction fees.

That's unnecessary. Miners can choose to include no transactions in blocks.
They can also choose to include only transactions paying higher-than-average
transaction fees if they want to make it more obvious to others that they are
going for high fees.

