What is Hot Right Now?

Part blocksize, part other?

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Bitcoin is growing quickly and the protocol has been temporarily capped with a theoritical transaction rate of 7 transactions per second – this cap has been surpassed multiple times already and is now a pressing debate. To put this into perspective, Visa handles roughly 2000+ transactions per second on average.

The transaction per second rate is limited because of something called the blocksize limit which limits the data capacity of a block to 1MB – this means each block can only contain 1MB worth of transaction data and obviously more transactions require a larger blocksize limit.

The creator, Satoshi Nakamoto placed this cap to discourage transaction spam because without this cap, someone could theoritically spam many transactions to create a very large transaction block size (ex: 25 GB blocks). This means all the transactions’ data in the 25GB block adds up to 25GB which would cause all sorts of problems including physical hardware limitations.

Solution?

Many proposals for blocksize scaling have been put forth such as increasing blocksize every x numer of years, dynamically increasing maximum blocksize and increasing frequency of solving blocks/shortening the time (miners currently solve blocks every 10 minutes).

Besides changing the blocksize, the following have been proposed to supplement scalability:

sidechains
lightning network
BIP #x (Bitcoin Improvement Proposal)
MAST (Merkelized Abstract Syntax Tree)
segregated witness
IBLT (Invertible Bloom Lookup Tables)
weak / thin blocks
extreme thin blocks
compact blocks
Schnorr Signatures
CLTV (Check lock time verify – enables future scaling) – now live
CSV (Check sequence Verify – enables future scaling) – now live
FIBRE (Fast Internet Bitcoin Relay Engine)
Falcon
etc.

Remember changes can bring about new vulnerabilities and it is not black and white. There is concensus that Bitcoin needs to increase scalability. The real debate is when and how as ultimately, Bitcoin will NEVER stop needing to scale.

Blockchain without bitcoin/token” and “THE blockchain vs. private blockchains”

There has been a lot of rumblings proclaiming that the blockchain technology is the real innovation of all this Bitcoin talk: “Blockchain without the bitcoin!”

But this assumption is based on blind and un-proven hype. Blockchain is the new buzz word without substance. Why? Bitcoin is the real innovation because it is a global, permissionless, borderless, open, immutable, non-duplicable, censorship resistant and an ownerless protocol based on (not perfect) democratic consensus. The blockchain by itself is a slow and ineffecient database compared to those that we already use today.

Take a way these characteristics and we are left with things we already have today: A centralized, 100% controlled and manipulated database that the few corrupt “leaders” can game and abuse.

Bitcoin is open innovation – any good change benefits everyone. Everyone can participate and they do. The collective innovation of people all over the world will always outpace the innovation of closed, central and over-regulated companies in the end.

The Bitcoin protocol is reminiscent of the internet – open, distributed, permissionless, etc. and thus is the real breakthrough. This is not to say many blockchains will not coexist separately or piggy-backed off of Bitcoin.

Think of private blockchains as intranets and think of Bitcoin as the internet.


“The blockchain has two important features to it. One is the ledger piece, but the other is the technological protocol for the movement of money around. Too many people are focused on the ledger piece of it, which is useful, not enough people are focused on the technological piece – the Bitcoin protocol. The Bitcoin analog to the Internet protocol. That’s the part that if this is going to be transformative it’s going to be the thing we most experience. […] So the the banks and the credit card companies in particular are going to be the biggest resistors […] They’re dipping their toes with private blockchains which I call Grandma’s version of the Bitcoin”

Glenn Hutchins | Investor and co-founder of Silver Lake Partners

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*Oct 27, 2016: Bitcoin Core v0.13.1 released. 95% of miner hashing power must upgrade for SegWit activation. | What's New? | Download Update | % blocks mined w/ Segwit | % Running v.0.13.1+
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