MS

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurati... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/196uf6f/daily_crypto_discussion_january_15_2024_gmt0/).

RHINO_HUMP

BUT HAVE YOU HEARD ABOUT MS. CLEO NAKAMOTO WHO PREDICTED ALGORAND TO $50???!!! (rip NEO)

zxr7

>microsoftonline.com It's the official MS login domain, but even SEC has their X compromised. Could it be a compromised MS space? /s

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurati... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/1959xub/daily_crypto_discussion_january_13_2024_gmt0/).

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurati... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/194gp3w/daily_crypto_discussion_january_12_2024_gmt0/).

HSuke

As a programmer, you should understand major and minor versioning and how major version often drop support for the previous versions. That's how efficient software works. You don't want to force Windows 11 to support every feature of Windows 95. And that's how Ethereum works. Compared to most blockchains, it's light on technical debt. Bitcoin has 10x more technical debt due to soft forks. You have to create clients that are completely backwards compatible with every older version of Bitcoin. For example, Bitcoin has to support all these types of addresses: P2PK, P2PKH, P2SH, P2MS, P2WPKH, P2WPKH, P2PKH, P2WSH, and P2TR. It would be great if it could automatically upgrade every address to Bech32m and Taproot and no longer recognize older address, but that would be a hard fork. That's technical debt.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurati... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/192txjj/daily_crypto_discussion_january_10_2024_gmt0/).

catgut65

There is some debt to consider, but then there is the BI value too. Also, the market seems to be pissed that MS is selling 5,000 shares per day for the next ~3.5 months, which will dilute that ratio, but mstr is always buying more BTC with free cash flow, so...DYOR.

Rey_Mezcalero

I can commend the president on taking on MS-13! That has been his greatest gift to improve the quality of life for the average citizen

Jeakjeak

bitcoin chart with some MS paint lines

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configuratio... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/1916u6i/daily_crypto_discussion_january_8_2024_gmt0/).

bananabastard

True. But I think the trajectory of BTC is much more predictable than that of MS.

bananabastard

Bill Gates is worth 133 billion, if he hadn't sold so much of his MS stock to diversify, he'd be worth 1.3 trillion.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configuratio... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/190e6q5/daily_crypto_discussion_january_7_2024_gmt0/).

DarthBen_in_Chicago

Anyone also still using MS Money Deluxe Sunset Edition?

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configuratio... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18zlrdt/daily_crypto_discussion_january_6_2024_gmt0/).

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configuratio... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18ys80b/daily_crypto_discussion_january_5_2024_gmt0/).

emyfsh201

I love this man's die-hard stance on Bitcoin! Say what you may about MS, it doesn't change the fact that he understands the potentials that Bitcoin has and that it's here to stay.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configuratio... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18xyear/daily_crypto_discussion_january_4_2024_gmt0/).

jaymeetee

The fact that MicroStrategy hold a lot of BTC does not lead to the value of BTC plummeting. Of course BTC could plummet despite MS, but right now the signs are all bullish (ETF, Halving, FED pivot, global liquidity increase, TradFi adoption and marketing)

nomorebonks

Price of ICP was at about $5.50 when this ridiculous interaction occurred. Now it's $14.10 because the tech is getting exposure. Every single project in this space does one thing: transactions. That's it. You strip away AWS, Google, MS, akash, flux, holochain, chainlink, etc. and what's left for these chains? One thing: transactions. It's all they do. They don't do AI, or games, or chat apps, or anything. They can't. What's ICP do? Everything fully on-chain. 100% full stack development of all apps on-chain, and on it's own node network not relying on any cloud provider. True tamperproof software living on the blockchain itself. Just no comparison to it. It will be used widely and outside of just the crypto space. It's also the only actual autonomous software to ever exist because the entire protocol is a DAO - either changes pass and get executed by the protocol, or they don't. No one can change it. And the launchpad, the SNS, does the same for any application built on ICP if the dev wants to do it. Software in the hands of the community. It can act as it's own oracle network since it can call out to web2 APIs bypassing LINK for example, and it's the most secure, imo, interoperability platform using chain key technology and secured with threshold ECDSA. And a ton of other stuff. You missed a 3x to here and it's going way, way higher. You didn't do your research.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configuratio... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18wau1l/daily_crypto_discussion_january_2_2024_gmt0/).

nomorebonks

Every single project in this space does one thing: transactions. That's it. You strip away AWS, Google, MS, akash, flux, holochain, chainlink, etc. and what's left for these chains? One thing: transactions. It's all they do. They don't do AI, or games, or chat apps, or anything. They can't. What's ICP do? Everything fully on-chain. 100% full stack development of all apps on-chain, and on it's own node network not relying on any cloud provider. True tamperproof software living on the blockchain itself. Just no comparison to it. It will be used widely and outside of just the crypto space.

nomorebonks

Take away AWS/Google/MS, Chainlink, flow, flux, holochain, akash and any hosting service for web. What's left you can build on Hedera itself? *Nothing*.

As03

it works for me, just navigate through some MS videos and you'll find the info

foulminion

This guy MS paints.

Salty-Constant-476

You don't. Until they're in your wallet they're about as real as drawing BTC : 25634.93758476 in MS paint.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurat... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18sfcdm/daily_crypto_discussion_december_28_2023_gmt0/).

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurat... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18sfcdm/daily_crypto_discussion_december_28_2023_gmt0/).

Buttcoinmodssuck

Thinking about investing in MS if there is a dip after the ETF gets approved

sugar4dapill

MS is green finally!

itsTomHagen

Honest question Why doesn’t BlackRock do what MicroStrategy is doing? Why do they prefer to go through the ETF route. Is it that MS is for private equity? Are BlackRock already doing what MS does?

Medical_Weekend_749

When MS buys, I buy.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurat... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18rm941/daily_crypto_discussion_december_27_2023_gmt0/).

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurat... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18q736k/daily_crypto_discussion_december_25_2023_gmt0/).

JamesBondMI6007

No they didn’t, but many banks do run those OS’s on closed intranet environments where they have total control over what can be done with them. That’s very different than utilizing a public blockchain, and why many banks are opting to use closed private blockchain solutions over open public ones. They also largely build and deploy their own custom applications and software. When they do deploy things like MS Office, again it’s heavily customized, locked down, and monitored by the banks OpsSpec/CS teams. They will almost always use private closed blockchain solutions over public ones.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurat... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18pil19/daily_crypto_discussion_december_24_2023_gmt0/).

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurat... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18osmh9/daily_crypto_discussion_december_23_2023_gmt0/).

coinfeeds-bot

tldr; Scammers used a wallet draining service called “MS Drainer” to siphon approximately $59 million in crypto from victims over the past nine months. They used Google Ads to target victims with fake versions of popular crypto sites. The scammers exploited the token approval process to transfer crypto from victims to the attacker without their consent. Despite Google's auditing systems, the scammers used regional targeting and page-switching tactics to bypass ad audits, allowing their ads to get through Google’s quality control systems. The developer of MS Drainer employed an unusual marketing strategy, selling the drainer for a flat fee of $1,499.99 and offering additional "modules" for higher prices. This incident highlights the significant problem of wallet drainers in the Web3 ecosystem. *This summary is auto generated by a bot and not meant to replace reading the original article. As always, DYOR.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurat... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18o18so/daily_crypto_discussion_december_22_2023_gmt0/).

Ku-no-ku

There's a great Lex Freidman podcast with MS from 2022. Still a good listen if you want someone to convince you to dump your savings into bitcoin.

OmeIetteDuFrornage2

I joined this sub in 2013 because of the "magic internet money" ad that this sub ran, with the shitty MS paint drawing :)

BigTdick07

He also said a spot ETF and FASB rule change are the things that would send Bitcoin to the moon. He hasn’t been wrong yet. MS is a very smart man, if he thinks that’s a possibility, he’s probably right.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for them to be auditing their pool operators and won't notice attacks until it's too late. > > This could be fixed with **Stratum v2**, but that's not available yet. And we don't even know if mining pools will enable the configurat... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18mghll/daily_crypto_discussion_december_20_2023_gmt0/).

Admirable-Style4656

MS is also the longest serving tech CEO in American history

cold_shit6456

what is this + L + ratio + wrong + get a job + unfunny + you fell off + never liked you anyway + cope + ur allergic to gluten + don't care + cringe ur a kid + literally shut the fuck up + galileo did it better + your avi was made in MS Excel + ur bf is kinda ugly + i have more subscribers + owned + ur a toddler + reverse double take back + u sleep in a different bedroom from your wife + get rekt + i said it better + u smell + copy + who asked + dead game + seethe + ur a coward + stay mad + you main yuumi + aired + you drive a fiat 500 + the hood watches xqc now + yo mama + ok + currently listening to rizzle kicks without u. plus ur mind numbingly stupid plus ur voice is ronald mcdonald.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. If this topic is active, submit an entry in r/CointestOfficial and earn Moons if you win. Moon prizes are: 1st - 600, 2nd - 300, 3rd - 150, and Best Analysis - 500. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for ... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Pros and cons per topic will likely change for every new post. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18k48e7/daily_crypto_discussion_december_17_2023_gmt0/).

HarrisonGreen

Because ETH, like BTC, is old tech. ETH has a massive first mover advantage, just like BTC does. But that advantage will not last forever. FB wasn't the first social media network. Nor was MS the first PC OS, or Google the first search engine. High fees, network congestion and usage difficulty are killers to mass adoption. Nobody wants to wait hours and pay $50+ for a transaction, or mess with complicated L2s, when they can just use other chains.

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. If this topic is active, submit an entry in r/CointestOfficial and earn Moons if you win. Moon prizes are: 1st - 600, 2nd - 300, 3rd - 150, and Best Analysis - 500. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. There are ~8B people in the world today. If Bitcoin grows to the size of 1% of the population, each person can make an average of 1 on-chain transaction every 230 days. **If Bitcoin usage grows to 10% of the population, each person can make an average of 1 on-chain transaction every 6.3 years.** To achieve 10% world adoption, everyone would need to solely be using centralized exchanges and not interacting directly with the blockchain itself. > > ####**Issues with the Lightning Network** > > **Not even the Lightning Network could save Bitcoin** because opening and closing a channel requires 2 on-chain transactions. Whenever the directional capacity of a channel is exceeded, it will need to be rebalanced, or be closed and re-opened. You can't expect people to store months of funds on a single channel. Half of the US is living paycheck to paycheck and would unlikely be able to keep channels open for long periods. If even 1% of the world used the Lightning Network and opens/closes their channels twice a year, the Bitcoin Network would become completely congested. > > **Not a true Layer 2** > > Similar to Plasma channels, **the Lightning network is not considered a true Layer 2 because it lacks global state.** There are many nodes that are not connected to the rest of the network, and onion routing issues can cause nodes to be disconnected from the rest of the network. **Channels only work if everyone's online.** If you're offline, others can force-close your channel, leading to a 1-week wait time where the channel's funds are locked and inaccessible. > > **Meant for small transactions** > > Lightning is optimal for small transactions. The larger your transaction, the higher the fees you have to pay to route it through the network. As of March 2023, the [average channel capacity](https://1ml.com/statistics) is only 0.07 BTC, and the average node capacity is only 0.33 BTC. It's not uncommon for a large 1-BTC transaction to cost $2-10 in fees to route through multiple nodes in the Lightning Network due to limited channel capacity, which can make it more expensive than L1 Bitcoin fees. Also, the total value stored on public Lightning channels account for under [0.02% of Bitcoin's total locked value](https://1ml.com/). > > **Partially-centralized, low-security layer** > > Most people just connect to centralized nodes in a spoke-hub network topology to gain access to high-capacity nodes. Even though [average capacity is getting bigger](https://bitcoinvisuals.com/ln-capacity), the [number of public channels has been on the decline since 2021](https://bitcoinvisuals.com/ln-channels), meaning that Lightning is becoming more centralized. > > **Channels require rebalancing** > > One of the biggest problems with opening channels is that they **start out with zero incoming liquidity**. Anyone who opens a channel starts out with a metaphorical "full cup of water". They can't receive any more water until they first empty the cup a little. And they can only receive additional water equivalent to the amount they removed. Similarly, people who open new channels to the Lightning network need to find a way to spend their Sats safely so that they can have incoming liquidity. Merchants and Lightning node providers often have a lack of incoming-liquidity while consumers who only spend usually run out of outbound liquidity. > > There are ways to rebalance your channel capacity, but it usually costs money to pay for a service to provide that liquidity, and it can be as expensive as a $1 fee per $1000 of liquidity. > > ####**The disadvantage of soft forks** > > The major downside of Soft forks is that they require new versions of the software to maintain backwards-compatibility with older versions, which leads to **technical debt**. This significantly slows down the adoption of new updates, which now often take 3-6 years to gain the majority. > > Due to its soft forks, the Bitcoin network has to maintain a mismatch of all sorts of different address formats: P2PK, P2PKH, P2SH, P2MS, P2WPKH, Nested P2WPKH, P2PKH, P2WSH, and P2TR. At the start of January 2023, [only 1% of transactions were using Taproot-compatible addresses](https://transactionfee.info/charts/inputs-types-by-count/) while 65% were still using inefficient legacy addresses from before 2017. > > **Almost no one is using addresses newer than the 2021 update because none of the major CEXs support them**. Most exchanges (Binance, Coinbase, Kraken) [don't support Bech32m addresses](https://en.bitcoin.it/wiki/Bech32_adoption#Exchanges), which means they still can't send to Segwit v1 and Taproot addresses, despite that it was [an update from 2021](https://bitcoin.org/en/releases/0.21.1/). > > In comparison, networks that hard fork for protocol updates don't have these incompatibility issues between versions. Everyone is working on the same version, which allows for consistency. > > ####**Extremely inefficient and wasteful** > > To protect against Sybil and 51% attacks, Bitcoin's PoW consensus achieves greater security through greater **redundancy**. Out of a million miners, only one of them is producing the actual block while the rest of them are just wasting energy and electric waste. Full nodes also hold redundant copies of the blockchain ledger, leading to wasted storage. > > In 2022, each block cost roughly $150-250K in energy to mine, which is equivalent to $80-120 of fees per transaction. The total Bitcoin network energy consumption of ~150 TWh/yr is equivalent to [**18-24 US nuclear power plants**](https://www.energy.gov/ne/articles/5-fast-facts-about-nuclear-energy). Another way of looking at this is that Bitcoin consumes about as much energy as all data centers globally [[Source](https://digiconomist.net/bitcoin-may-consume-as-much-energy-as-all-data-centers-globally)]. > > In comparison, other distributed consensus methods such as BFT are [10^7 x more efficient for energy use](https://link.springer.com/article/10.1007/s12599-020-00656-x). There is a silver lining: the energy waste (and security) will slowly decrease with each block subsidy halving, at the cost of decreased security. > > ####**Mining Pool Centralization** > > **The top 3 mining pools own 66% of the network hash rate** [[Source](https://btc.com/stats/pool)]. Individual miners have no financial incentive to run full nodes, so it's rare for ... ***** Would you like to learn more? [Click here](/r/CointestOfficial/comments/100p7u8/top_coins_bitcoin_conarguments_january_2023/) to be taken to the original topic-thread for this argument or you can scan through the [Cointest Archive](/r/CointestOfficial/wiki/cointest_archive#wiki_Bitcoin) to find arguments on this topic in other rounds. Pros and cons per topic will likely change for every new post. Since this is a con-argument, what could be a better time to promote the Skeptics Discussion thread? You can find the latest thread [here](/r/CryptoCurrency/comments/18hv68n/daily_crypto_discussion_december_14_2023_gmt0/).

CointestMod

#Bitcoin Con-Arguments Below is an argument written by a deleted user which won 1st place in the Bitcoin Con-Arguments topic for a prior [Cointest](/r/CointestOfficial/wiki/cointest_policy) round. If this topic is active, submit an entry in r/CointestOfficial and earn Moons if you win. Moon prizes are: 1st - 600, 2nd - 300, 3rd - 150, and Best Analysis - 500. > ####**Intro** > > Overall, Bitcoin's conservative blockchain has failed to keep up technologically with other blockchains. Bitcoin is currently #1 not due to better design, but because it had a first-mover advantage. But how long will that hold? > > Bitcoin is a gateway cryptocurrency. Many crypto enthusiasts often started out with Bitcoin and then branched out. Once you've had a taste of newer, faster networks that offer delectable DeFi dApps and smart contracts, it's hard to go back to slow, boring old Bitcoin. > > ####**Bitcoin doesn't excel at anything** > > **Poor Medium of Exchange** > > Bitcoin is much too slow. It has a max throughput of **3-4 TPS** that takes **30-60 minutes for probabilistic finality**. It used to have a max throughput of 7 TPS, but that has gradually fallen over the years after exchanges started using batch transactions. It's much too slow to be used for point-of-sales merchant transactions. No one is ever going to want to **wait 30-60+ minutes** at a cash register for a transaction to go through. Block times average 10 minutes, but they are very variable. 14% of blocks take longer than 20 minutes, and 5% are longer than 30 minutes [[Source](https://bitcoin.stackexchange.com/questions/25293/probablity-distribution-of-mining/43592#43592)], causing stress for those waiting for confirmation. And if there's congestion, some transactions can get stuck in the mempool for hours or days. > > It's orders of magnitude slower than newer networks like Polygon PoS or Algorand, which can [process 4000+ TPS with sub-4s of deterministic finality](https://developer.algorand.org/docs/get-started/basics/why_algorand/), with transaction fees well under a penny. > > Even TradFi now has payment systems like Africa's M-Pesa, UK's Faster Payments, Australia's NPP, the US's upcoming FedNow, and Clearinghouse's RTP, which provide **near-instant** payments and peer-to-peer transactions **without fees**. > > **Unstable Store of Value** > > Bitcoin is too volatile to be considered a stable Store of Value. It lost up to 80% of its purchasing-power during previous bear markets. It's also NOT a good stock market hedge since it often moves with the stock market. > > **Lacks smart contracts and DeFi** > > Bitcoin doesn't support DeFi smart contracts with its very basic Bitcoin Script. There are smart contract protocols that use Bitcoin like Stacks, but they are very disconnected from Bitcoin. > > ####**Difficult to achieve widespread global adoption** > > At 4 TPS, Bitcoin can only make ~345K transactions/day. Ther