[Cryptography] Bitcoin is a disaster.

[Deryk Makgill]

On Monday, December 28, 2020 7:07 PM, Ray Dillinger <bear at sonic.net> wrote:

>The scarcity of block chain space has led people to re-invent every last feature of the banks they thought they were going to be escaping.

There's a popular quote floating around that in the future, transacting on the blockchain will be as rare and specialised as chartering an oil tanker. What's annoying is the OP thinks that's a good thing and very few people of note seem to disagree.

Many of us have been warning this outcome was inevitable for years. If transaction fees become too expensive, funds will consolidate on centralised exchanges and only a very small number of "banks" will use to blockchain to settle funds for the rest of us peasants.

This makes possible political control through the regulation of payment layers, censorship, tracking, loss of privacy, seizure of funds, fractional reserve...all the things we want to kill. As Satoshi said, "the main benefits are lost if a trusted party is still required..."

Lightning Network has largely failed thus far to live up to its early promises and timelines, and I can't help but think that in a Bitcoin world, most people will just be using things like PayPal, Square, Alipay, etc, to move and store funds because they will be priced off the blockchain. We already see it happening.

That's just not exciting.

The irony is that in the effort to allow everyone, everywhere, to run a full node (as opposed to what Satoshi intended), developers killed the reason most people would have to run a full node in the first place—to validate their own transactions on-chain.

>Mining is f***ng broken, and ASICs make it actively work against a significant number of its design goals.

Didn't Satoshi predict that Bitcoin mining would consolidate into server farms? "It would be left more and more to specialists with server farms of specialized hardware."

>The more scalable the network becomes, the more centralized it becomes, until ultimately a "scalable" cryptocurrency would be doing things exactly the same way as a credit card processor.

You said on BitcoinTalk several years ago that the plan was always to raise the blocksize. Is it still your opinion that it should have been done? Or do you think that even Satoshi's original plans were flawed too?

Thanks for your thoughts. I still wouldn't say it has failed completely, but I can't disagree that it hasn't lived up to much of the early vision.