If you thought bitcoin was dead as a payments system, take a listen to George and Jimmy Nguyen, founding president of the Bitcoin Association, as they discuss Bitcoin SV, a new version of bitcoin that is a significant upgrade to the performance and capabilities of the original bitcoin protocol put into the world a decade ago.
From a payments perspective, bitcoin has failed. While successful as an albeit volatile store of value, its failings include:
- It is slow, only able to handle 2 or 3 transactions per second with a peak rate of 7. Visa handles 50K at peak holiday times with aplomb.
- While transactions are irrevocable, they are not immediately written to the blockchain. Core design specifies that that happens every 10 minutes but when the network is under load it has taken hours.
- Processing cost is too high, measured in dimes and dollars, and also volatile
- As the processors, known as miners, are rewarded with fewer bitcoins for their work, they’ll have to rely on processing revenues, transaction fees, to stay viable. Costs are already too high
- There’s the high power usage of the network that’s needed to maintain consensus, essentially trust in the network.
If you thought bitcoin was dead as a payments system, take a listen to George and Jimmy Nguyen, founding president of the Bitcoin Association, as they discuss Bitcoin SV, a new version of bitcoin that is a significant upgrade to the performance and capabilities of the original bitcoin protocol put into the world a decade ago.
Jimmy brings a refreshing view on cryptocurrencies and payments. Jimmy provides a great review of how bitcoin works and why both its performance and its economics are broken. He explains the advantages of the Bitcoin SV fork and why it was necessary. Suffice it to say, bitcoin’s evolution is subject to the often fractious politics of that community where competing interests inhibit long term thinking.
Bitcoin SV has intriguing potential. Micropayments, sub $1 transactions, have never found a home in electronic payments. BSV could apply there.
BSV is also designed to use enormous blocks in order to keep processing costs low and provide the ability to store massive amounts of data about the payment.
