The bitcoin situation – core’s small blocks & lightening network plan – makes me sad, but long-term hopeful. Here’s a possible future.
BTC stays around for the medium term and continues to appreciate in value. The ongoing influx of institutional money and legitimisation from highly visible investors looks set to continue, and will help to secure that outcome. The lightening network is eventually implemented. Fast, low fee transactions are possible again. Adoption continues to increase.
But thanks to the deliberate small-block policy, Censorship resistant transactions (ie. on-chain transactions) are now prohibitively expensive. Only large financial establishments are able to transact that way profitably. Everyone else using bitcoin – the little guy – is economically compelled to transact through a lightening hub liquidity provider – a trusted party, a financial middle man.
So BTC continues to grow in this way, with the support of old world money institutions, and governments – lightening hubs will be regulated as providers of financial services – and therefore enmeshed in the dreary game of statist politics.
In my view it will have effectively been co-opted at this point, EstablishmentMoney 2.0. De-facto centralisation, and a million miles from the crypto-anarchist vision that bitcoin owes its genesis to.
The silver lining: While this is happening, alternative crypto currencies (perhaps BCH, perhaps something else) will continue doing their thing, gaining new users on net. And offering something that BTC will be increasingly unable to provide in practice – censorship-resistant, trustless internet money.
As BTC sees increasing use in the world, these better cryptos will look less and less alien to joe/jill public.
So you mean you use it just like bitcoin, but no one can spy on my activity or decline my transactions?
That’s a dramatically lower barrier to adoption than Nakamoto Bitcoin had to overcome to find its foothold. Next time round the odds are better.