I was 16 when I picked a small book off my father’s library. It was also one of my first hard reads in English. It was called ‘Foundation’, by Isaac Asimov. Foundation, for those who do not know, was inspired by The Rise and Fall of the Roman Empire and, if you ask me, must have at least in part inspired Star Wars (we all stand on the shoulders of giants, after all). It is a story of galactic scale and millennial span.
What matters here is that the great mathematician Hari Seldon forecasts the fall of the Galactic Empire and strives to alleviate the upcoming suffering by creating the Foundation. Events Hari couldn’t forecast (no spoilers) that a mutant would throw a wrench into his master plan. Read Foundation and Empire and Second Foundation to get the whole thing.
Digression over, Satoshi reminds me of Hari. She saw and tackled a problem. Some things he foresaw, some others they may not have, or it tackled covertly. These issues need to be tackled.
Some of these issues have been covered by others, but I have not seen all of them in a single post. Since single proposals are out there already, I know the technical solutions are conceivable. Here are the wrenches as I see them. I will go into more detail on each in other posts:
Wrenches in Bitcoin’s machine
|The issue is not block size, it’s blockchain size. A large blockchain:
Requires large storage space,
It is more susceptible to DB corruption,
It becomes harder to manage and explore,
Setting or rebuilding a node takes days,
These issues all conspire against widespread nonprofessional participation.
|Nodes need to be reformed to stay small, numerous and motivated.
Redesign the blockchain DB so nodes can store individual parts of it.
Establish a reward system for block storage and broadcast.
|Value transfer is a private affair. Only parties should be able to allow its view to the public.||Transactions should be cloaked unless parties de-cloak them. Getting a bonus, paying for a child’s cosmetic surgery or ordering a million triangular Gorilla Glass screens for a new product launch should not be visible to nosy neighbors or competitors. The state itself would certainly not pay for military issue toilet seats or fighter jet fuel with bitcoin if everyone could know the details.
|Remember the funny shape of one of the thirty pieces of silver that your great great grandfather paid for that flock of sheep back two hundred years ago? You do not, and it’s probably better that way.||History needs to be forgotten.
Introduce jubilee points into the blockchain.
Rely on block storage incentives to induce progressive forgetfulness of old blocks.
|Bandwidth needs to be expanded by several orders of magnitude
|To be relevant, let’s say btc needs to account for 1% of the world’s transactions. Roughly, if Visa processes 10k transactions per second, let’s say overall card transactions are ten times that and other transactions are on the same level. So there are today two hundred thousand transactions per second in the world economy. That would be 17b transactions per day, i.e. 2.5 transactions per person per day on the planet. This is back of the envelope, but probably not far from the right order of magnitude.
With those assumptions, Bitcoin needs a bandwidth of 2000 transactions per second (1% of two hundred thousand) just to be on the radar.
|Security||Security needs to be variable according to the value of the transaction, so as to decouple growth in the size of the mining network from growth in the size of the economy||If the security of the network is a one size fits all, low and high value e payments cannot live together unless cost is no object.|
|Economic issues, a.k.a. Elephants in the room||A couple of guys cannot own five percent of the planet’s wealth||I do not offer a solution to this one, but the issue stays. It may solve itself with growth or it may not, through losses, dilution etc., but if it does not, it jeopardizes bitcoin adoption.|
|A large portion of usable tokens is that unleashable at any moment is a risk factor to the value of the token and its related economy.||Whatever your regard for the quantity theory of money, Nakamoto & co. huge pent up spending power is a threat to everyone’s savings.|
Now, I am no great coder and any BIP needs coding, so I apologize in advance and expect the flack.
You do not hear much about this book and the sequels, but it has always had a place in my heart. Asimov was a bright physicist and a great communicator, although a bit of a collectivist (and who can blame him, since most of his productive life happened while the Soviet Union was humming along just fine? Lol.)
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