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Arguably, you cannot scale a blockchain to validate the entire world’s transactions in a decentralized way.
Much like today’s internet and financial system, it is more optimal to comprise the whole system of separate layers, where each layer optimizes for and is used for different things.
The Lightning Network is a separate, second-layer network that works on top of the main Bitcoin network. Simply said, it batches Bitcoin transactions.
A Lightning node: separate software that communicates with each other and constitutes a new peer-to-peer network.
Channels: a connection opened between two Lightning nodes, allowing for payments to flow between them.
The Lightning Network already scales to support 16,264 transactions a second today and therefore solves the scalability problem while preserving all the benefits Bitcoin has to offer — permissionlessness, scarcity, user sovereignty, portability, verifiability, decentralization and censorship resistance.
With 16,266 nodes in the network (as of November 2022), assuming each payment has to go through three channels (four nodes), the network should be able to achieve around 134,194 payments per second.
Visa saw 165 billion payments in 2021, PayPal saw 19.3 billion payments across its whole platform and FedWire saw 204 million. Respectively, these amount to 7,372, 612 and 6.5 payments per second on average for 2021.
It takes each Lightning node to be capable of doing just four payments a second in order to beat the current payment networks by at least two times. At that rate, 4,066 unique four-node groups can achieve 16,264 payments per second — 2.2 times that of the largest competitor, Visa.
To make matters worse for traditional payment networks, the average Lightning transaction fee is 13 times less that of Visa — 0.1% compared to 1.29%.
To give a sense of the progress there, River Financial recently shared that its (lightning) payment success rate is 98.7% at an average size of $46, which is astonishingly better than the earliest publicly-available data it could find from 2018, where $5 transactions were failing 48% of the time.
Do we want the Lightning Network as a solution to the scalability problem and, if so, will it succeed?
Source: (highlights, excerpts, and stats) https://bitcoinmagazine.com/technical/lighting-network-makes-bitcoin-scalable
This is a serious concern that has been raised by juliangrigo on Twitter. The tx may be settled within seconds via lightning. But you will have serious troubles if the funds are not "clean". How could you find out? If your funds come out of a mixer, a sanctioned exchange, are connected to public addresses known from dark markets or ponzis, there are big risks waiting for you.
Exchanges will block your funds if they find out they come from a privacy tool or if are "tainted" coins. What's more you could find yourself prosecuted because you are in possession of stolen funds or funds that are related to criminal activities...
Tools like chainalisys make it very easy to trace coins but are generally not accessible for your average user. Are peer-to-peer transactions a utopia that have no place in the future?
I told him about various problems that all these projects are solving. He says most of them are self-created and the rest are not solved yet but only promised to be solved.
He does agree that it's easy to transfer funds but if we consider from Bank to Bank, the steps of conversation (to cryptocurrency and back) are added since to use these funds you need fiat for almost everything right now.
And what if the phone is out of battery or the internet is down, how would the payment thing work at the local grocery store?
Hey all,
I'm on a mission to help people with scams and fraud in crypto. This post is about the stages of the business and the direction that we're taking now and curious to hear what folks here think.
The direction we started off with was asset recovery. Asset recovery wasn't feasible because of (a) inability to actually recover the assets (b) the business model of charging people upfront. Because of these two factors we decided to pivot.
The pivot was away from recovery and to prevention measures. The first and most obvious prevention measure was education as we thought that if people were better educated, they'd make better decisions and not get scammed/defrauded. Unfortunately, there is a lot of education material out there e.g. BoringSecDAO, and people just aren't consuming it. The conclusion I came to is that the reason people are not consuming education it is due to lack of incentives, which made me think about more proactive measures.
The proactive measure I thought of first was something like a chrome extension that could run test transactions between your metamask and the smart contract you come into contact with. This way you could see exactly what would happen if you sign the transaction and thus allow you to avoid wallet drainers or malicious smart contracts. The thing is though, there are tons of these tools out there, both in development and live in the chrome store.....it feels like it'll be a really crowded space soon.
So to avoid that crowded space, I've decided to look into insurance. This is a preventative measure, but it's better than education because it's easier, it provides financial recourse if you suffer a scam/fraud and creates peace of mind. To get to that peace of mind, you'd put in a small amount of crypto initially which would then form a fixed upper limit insurance policy for a fixed term.
So essentially, there's two ways it could work:
- 12 month insurance policy against scams/fraud up to the value of 1 Eth, price: 0.1 Eth
- 12 month insurance policy against scams/fraud up to the value of 1,000 USDC, price: 100 USDC
Does that make any sense? Does this seem like something folks would be interested in?
*Policy would not include rug pulls
I mean, people are comparing Do Kwon to SBF but I dont think they are the same.
Terra Luna before the catastrophic failure was very sucessful, would you destroy a multibillion dollar enterprise to scam everybody? It doesnt make sense.
SBF clearly did criminal things with customers funds, Luna was not an exchange! Terra was a very promising crypto platform, nothing alike holding people's cash in hostage promising its safe.
I really dont know but Do Kwon from my perspective, made a serious mistake or judge his own skills way higher than actually he was.
Nano pumped over 100% today, and people are talking about it again for the first time in a while. I love the idea of Nano and IOTA, but they might be physically impossible on a large real world scale. I see some extremely difficult problems with a feeless decentralized network:
Imagine you have a website.
The website runs on a number of servers. You allow everybody on Earth to upload an unlimited amount of videos to your servers - for free. Also nobody can ever delete the videos that get uploaded. Great idea, you think. Your website grows, and suddenly millions of people are uploading videos 24/7. You still can't delete any videos to save space on your servers' hard drives, and you can't pause or limit people's uploads to 2 videos/day per person. A single person can upload 100,000 videos every day if they want to. So you keep buying more servers and more hard drives, to avoid running out of space. How long can you keep doing this for, until you hit a financial or physical limit?
Transaction fees are the only actual defense that any decentralized networks have, against spam attacks, and even just against unhinged database size growth. Consider a spam attack on Nano where 100, 1000, or 10000 computers start spamming transactions 24/7 for months. On other coins, this would cost millions of dollars in transaction fees + electricity, but for Nano it would only cost electricity, making it at least 99.9% cheaper
Here's the problem: All of these spam transactions must be physically stored on hard drives to complete the Nano ledger - together with all of the other regular transactions. Remember that if 100+ million normal people start using Nano, the natural growth alone will make the ledger grow to an insane size. How large will the ledger grow, when there is absolutely nothing limiting the amount or frequency of transactions? Petabytes, then exabytes eventually. So who will store the ledger on their hard drives in the end, especially when there are no transaction fees to pay them for their support?
Hey.
My portfolio (BTC valuation) is up 62% since 10th Nov. 2021.
My portfolio (USD valuation) is down 60% since 10th Nov. 2021.
This is because I held MATIC. It pumped after the BTC ATH.
And then, I swapped parts to various alts (Quant, etc.) in march 2022.
I gained a little bit of profit and swapped to BTC in august after the rebound within the bear.
Since then I am kind of swing-trading BTC.
How much is your portfolio up/down since 10th Nov. 2021?
Thank you in advance.
Oh. And I don't know why I am asking.
I cover a few different client across investments - and it's amazing how people are looking at FTX and other exchange failures.
people are saying 'FTX lost' or SBF lost etc.. no, there is one truth... SBF enabled the theft of some 30B of other people money.
It's crypto.. it's volatile.. YES.. it is - but SBF stole money
It's an exchange, other people made money - YES it is .. but SBF enabled and created a platform so he can steal money.. it was legitimized by other people who wanted to make money off his platform. So every time someone shorted or gained - SBF was making money
He lost money / He didn't understand - NO - he stole money and no matter what - he used the media like Elizabeth of Theranos to further his legitimacy !!
HE stole money.. unlike theranos lady - he stole from retail investor and others !!
Fuck the people who romantize this shit and act like nothing happened. Every media is making this a clickbait event !!!
This bear market has been brutal, specially after the fall of FTX and some people are saying that it's impossible to get worse. Well below I present you some scenarios where it could. Note that I'm not saying that they will happen, it's just pure speculation.
-Tether collapse. With over 65 billion in the crypto market tether's collapse will make FTX's a kids play
-Satoshi moving his coins. He owns more than 1% of BTC's supply, approximately around 1 million BTC. Satoshi's first move in over a decade will definitely crush the market as it could be seen as a sign of Satoshi giving up crypto.
-Binance collapse. Do I need to say anything more? Liquidity will fall more than 50% BNB would go to 0. Many people will lose their money.
Again, not saying that they will happen, it's just pure speculation for fun and debate.
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Thoughts on these guys? They seem to have been incredibly accurate at calling out bad actors (e.g. SBF and Du Kwon) way before everyone else caught on! Even Coindesk said more should listen to them lately...
Spoiler: Social indicators can be such a great indicator when to buy or to sell
Now to the main statement for my post:
At the end of October I hear so many people being bullish on crypto, they call it Moonvember and suggest a market rallye. Crypto indeed had a nice green day and all those degens who were -90% anyways cheered up about the roughly +10%.
How very very wrong we can be. Now in November we see what happens...crypto hitting a new low this year!
Post here on this sub in October were like:
9 out of 11 TA indicators say we already hit the bottom!
Reddit NFTs boom, buy it and be rich. Crypto super! Bla Blah!
If you're not buying now, you'll FOMO soon
I suggest a new more reliable indicator than those TAs when the bottom is in:
less bullish numbers of posts, more bearish numbers of post
suicide hotline pins
less overall social media interactions regarding crypto
more "dooms day" posts, more disbelief posts, more good crypto related informative posts
I won't be buying more crypto, not until these points above are met.
So the football championship in Qatar starts tomorrow. Crypto.com To Sponsor FIFA World Cup Qatar 2022.
Do you think this ad will make a rally in crypto ? I personally think it will attract new people. I'm just afraid that people will buy new shitcoins with nice names . We will also see what the Cronos coin will do these days.
It is a great pity that the crypto exchange is experiencing these huge problems right now. These days will show us how much people trust this segment
Anyway, let's enjoy some football first.
I don't get it.
So why are many 'experts' predicting a even longer crypto bear market due to recent events?
Basically CEXes won't print unlimited amounts of paper BTC/Crypto anymore, which should drive the prices up very soon?
And smart investors actually do understand that recent events originate from the same issue that the traditional money system suffers from, and it proves even more that BTC/Crypto is superior because it cannot be manipulated?
Thank you in advance for your insights, have a nice weekend, bye.
Hi fellas,
what do you think will go up first the crypto market or the stock market? I mean go up as in getting out of the bear trend. Will crypto start the uptrend? or will it be stocks followed by crypto after them?
I would like to have people discuss the subject and shed some light on the topic of stock and crypto decoupling.
What do you expect will happen when the situation recovers? will crypto react as tech stocks are on steroids as lately it's been?
Previous experiences in the bear market would be much appreciated, comments concerning how unexpectedly reacted will also be welcome since I guess it's almost mandatory to mention how unpredictable the crypto market is.
There's plenty reports of Tom Brady, Giselle Bündchen, Shaq, Stephen Curry being included in the lawsuit against celebs that promoted FTX exchange in their massive advertising campaign at the beginning of this year. It could be argued that they were unaware participants simply reciting a script provided by advertising companies as they regularly do with plenty of companies promoting services like insurance, food products, apparel or even medical products.
The one commercial that stands out to me is the Larry David 2 minute Superbowl commercial. In a hilarious commercial that paints Larry as a skeptical moron he is suggested to use FTX and his response is "Naah I don't think so, and I'm never wrong about this stuff, never"
His statement is followed by a text saying "Don't be like Larry; Don't miss out". When compared with all the other promotions his was the only one that was adamantly against the idea of investing with FTX then was followed by text contradicting his (comical) message.
In my opinion Larry David is innocent. He was the only celebrity actually giving good financial advice without ever suggesting financial investments at all. A rare win for the Larry David we know from Curb Your Enthusiasm.
This argues a belief that bitcoin premises are too simplistic with foolhardy expectations.
Is bitcoin a foolcoin that found the greater fools? An illusion of value that by greed caused fools to bid up the price until the greater fools held a majority stake. It's an ideal scam. A pocketful of lint in exchange for trillions.
1) Everyone should have stopped to think more after the first thefts of BTC from failures of decentralization to prevent records manipulation via majority control of a block. Especially when one BTC was less than an average monthly paycheck. One block does not cover much potential retail space when considering the worldwide agenda for its use. Trust within one block is not enough. Trust between blocks is critical to trust in BTC as a whole.
2) This consideration of block trust leads to the next utter failure in design - mining. Scalability is a precept. Issuance matters must be perfected before launch. Did no one deduce what might happen when mining took over issuance? One need not control the current supply. One need only control the new supply. What happens when mining mechanics are gamed to extract max new supply? What happens when one or more blocks are majority controlled by the same entity that also games mining?
3) Ultimately, the fate of BTC depends on the behavior of all token holders. It's only decentralized if BTC holders keep it decentralized. Extend BTC into 100 years of scammers employing genius deviants to find weaknesses in the design. We've seen that financial scams are big business in the white collar district. These exploits won't be prevented by regulators or the good will of big business. How is the behavior of BTC holders to be managed to safeguard its value?
When looking at these three major weaknesses in design it is clear that the premise was flawed. Did the founders not have the ability to think three moves ahead, or were they ignorant of real human motives or behavior? The impressive thing is that BTC still exists. No doubt the no good opportunists have been finding exits before doom comes.
These arguments make clear that BTC proves unscalable because of lack of trust, the very problem that the design was made to solve. Block records are not globally provable always. Mining can be monopolized. BTC holder behavior can create vulnerabilities to ownership and exchange.
This is a serious attempt to garner realist perspective about BTC. Is it a foolcoin?
Crypto can't take the next step to global adoption in its current form. People are used to fiat, and it is relatively simple and safe to use. People use their credit or debit card for purchases, and if there is fraud, the money gets returned. If there is fraud with a bank account, the money is often returned.
People are lazy. People are willing to "pay" credit card companies for "security."
Crypto involves buying it on an exchange, but you can't safely keep it on most exchanges because it is not held in your name, and in the case of bankruptcy, it is not yours. It is recommended to keep your crypto off of an exchange in a hardware wallet. Most people have spent 1-10 hours researching before moving their crypto off an exchange for the first time. Most people are lazy and won't do that.
Most people cannot be trusted to keep their crypto secure.
People don't want to pay fees.
People hate paying fees. Yes, everything is 3%+ more expensive because credit card fees are baked into the price of everything. People hate when retailers charge them credit card processing fees. People don't want to pay a fee for each transaction. People don't want to pay a fee for crypto insurance.
The credit card fee is already baked into the price, and even if we 100% switched to crypto and there was no merchant fee, things would not get cheaper.
There must be substantial changes for crypto to reach mainstream adoption, and people getting less lazy will not happen.
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This may be a bit of a controversial take here, but I partially don't understand some people in the past days dragging all the blame and their own fault on some influencers and celebrities that promoted FTX. Obviously they probably just got paid for it by FTX and there is even a possibility that they were knowingly shilling a scan to all of us.
But the most likely scenario would be that even they were lied on by FTX. Just imagine, FTX was ready to lie to auditors, regulatories and even governments. So why not some celebrities?
It's highly likely that those people who promoted FTX also just had a mostly perfect imagine of FTX like we before.
I'm saying mostly here because obviously there were even back then reports about them lobbying against other crypto exchanges. But if we are true with us, even we did not think that SBF would just be stealing all users money in daylight.
My point is that people should stop complaining now about decisions they took themselves but instead learn from those mistakes.
What's your take on this?
I know this sounds very unpopular, but the big daddy coin might never reach over $69k ever again.
Before all the big daddy coin maxis grab the pitchfork and downvote me to hell, let me explain:
The covid period was a very unique time, FED was printing and printing, people were at home, didnt spend much money because they had to stay at home, so a quite big bunch of them spend it in crypto.
20010-2021 no recession, everything seems fine, money printer goes brr brr.
Crypto never experienced recession/ stagflation.
Big daddy coin was the "only good coin" in the pre-smart-contract era; other coins were just slightly faster Proof of work coins, meme shitcoins, coins just for payment solutions.
Now we have great viable Proof of Stake coins with much better fundamentals and tech.
More alts eating up big daddy's dominance.
See ya $69k ATH! We will miss you!
EDIT: big daddy maxis wraith is high, so many downvotes for an unpopular opinion
I do think that after all we've seen the general population is not ready to handle their financial sovereignty. So they have to rely on third parties for their financial "independence". And those third parties regulated or unregulated do what they do. They maximize their profits.
So now we are in a situation, where everything that presents itself as "crypto" is very much unlike what Staoshi envisioned in his early days. We re-created the old financial system on drugs with fraud in plain daylight and victims that don't even recognize that they are victims in a ponzi scheme after the whole thing exploded.
All of that will be seen as "crypto ponzi-casinonomics" from the outside world, which from their perspective is dangerous - and indeed it is.
In the end regulators will try to do the right thing and protect the elite. They will just regulate everything that they can regulate. But not because they fear you losing your money while gambling on some thinly traded shitcoin (most of top 20 on CMC). No, you might not even be able to buy and sell on a CEX if you are not in the millionaire club. Because the only thing they fear is competition to their fiat empire. And sorry I am not talking about Bitcoin as digital gold (which is a failed narrative), but I talk about privacycoins that challenge the status quo as daily cash.
Government overreach will again make it more complicated for early adopters to move their funds into privacycoins. But on the other hand it will most likely make it the most lucrative investment in the space while saying fuck you to the government and doing a good thing for human rights and civil liberty. If that's not the trade of a lifetime. I don't know.