For years we were sold that bitcoin was a low cost payment system. We were excited every time another retailer announced they would accept it as payment.
It turns out that we were sold a false bill of goods and a fools paradise.
Now we are told, “no, no, the bitcoin network does not scale” (even though we were told for years this wasn’t a problem because we could just raise the blocksize). The new story is that the blockchain is a scarce resource and we should fight to pay the highest transaction fees to obtain the privilege of getting a transaction processed.
Without raising the blocksize then fees will quickly rise to $30 a transaction or more as the demand increases and the block reward decreases.
Am I the only person annoyed they were lied to for years on this topic?
Can bitcoin still work as a settlement layer where a tiny minority of the population, mostly major banks, ever get access to it and, at that, with very high fees?
Yes, it can, but that isn’t what I signed up for. I signed up for a low cost payment network, electronic cash, not a Fort Knox used only by centralized third party systems as a settlement network.
I suspect you have struck the heart and truth of the matter, except I don’t think you were lied to, I think we deceived ourselves. Everyone has been thinking of bitcoin in terms of themselves and not thinking about the big picture.
I also think this hits the core of the argument proposed by Nash.
I do believe the bitcoin elite understand this very well also, except because of the importance of decentralization and consensus they mustn’t focus on their own understanding of bitcoin, even though it might be obviously theoretically correct.
In other words it might be economically correct and obvious that bitcoin should be more toward the role gold plays today and less like a cash system HOWEVER it is still the collective PEOPLES that ultimately decide and NOT the scientists/elite.
The debate has become part of the experiment, just as much about block-size as is about possibilities of consensus (or not).
People are thinking about their own wants, but not understanding the history of the world in relation to different monetary standards of their time. In a way the need for a single uncorruptable standard has been the cause of all of the wars of mankind.
Do you want your coffee, or perhaps we could address the need for such a standard and then we can decide how we should print monies only in relation to that standard?
Here are some interesting excerpts from Nash’s Ideal Money: