Although I’ve just recently moved money into cryptocurrency, I’ve been fascinated by Bitcoin since 2013. It was the “magic bullet” that promised to save our financial futures from high fees and the global fiat (currency) system.
However, neither has happened. While some people could argue that Bitcoin is becoming a store for wealth, one that that it isn’t is a great transactional system.
Case and point: Reference a blockchain explorer such as SoChain. (https://chain.so/) As of this writing, there are 240,000 unconfirmed transactions. The average time for a transaction to be confirmed? 70 hours. You read that right. From the time a person initiates a Bitcoin transaction, the poor soul has to wait almost 3 days. Hope you weren’t buying coffee; it’s guaranteed to be cold by the time your coffee shop can confirm that you’ve sent payment.
There is a second consequence: Anyone who isn’t willing to wait for 3 days will have to pay a steep transaction fee in order to have the Bitcoin miners prioritize their transaction. In this writer’s case, a miscalculation resulted in the sending of $21 USD. The transaction went through within minutes….but only because I unknowingly paid almost $16 to send it!
It’s easy to see that Bitcoin is failing miserably as a transactional system. Sure, one could argue that it has potential. Yes, one can argue that it is serving its purpose as a “buffer” or “separation” against the global currency system and the inflation/mismanagement therein.
All of these other means may or may not matter if you cannot initiate a transaction in a timely manner without paying exorbitant fees.
One possible solution, the SEGWIT2x “hard fork” that was supposed to happen in early November but was cancelled. It was supposed to solve at least a few of current issues by drastically improving transaction times, but fears were that it would split the Bitcoin community and cause more harm than good. Check the information about this fork here: http://b2x-segwit.io/
Another possible solution is another hard form that will produce something called “Lightning Bitcoin.” Like the SEGWIT2X, it is supposed to drastically decrease transaction times. (Some of the communication states that the goal is to make transactions “as fast as lightning.”) For more information, refer to this link: http://lightningbitcoin.io/
Will either of these forks – assuming they happen – solve the current issues with Bitcoin? I think there is promise. However….the proof is in the pudding, as they say!