r/btc • u/LovelyDayHere • Jun 30 '25
⌨ Discussion BTC is capacity-restricted to prevent 99,9% from using it permissionlessly
You might not have known this, but there is a low limit imposed on the transaction rate on BTC, that means very few people can use it before it becomes congested and transactions can no longer get in the next block.
You will hear BTC proponents argue that
"It's permissionless nature allows everyone to use it."
But that is marketing.
Reality is that they (BTC developers together with those who supported them in this) restricted BTC's Layer 1 (L1) capacity to far below what is technically possible, in order to preemptively create a "fee market".
This means that when the network becomes congested, transactions have to outbid each other on fees in a blind auction to get confirmed.
This causes fees to rise, even exponentially, in that situation, with rich people (or big institutions) able to afford the fees, while the rest cannot afford to reliably transact on L1 and must seek out other solutions, or wait for an undetermined amount of time until usage on the network drops again and fees drop too.
BTC proponents will say
"All users are equal"
But when you have to participate in an auction to get in a block, suddenly it matters a lot whether you are the richest or not -- this will decide how soon your transaction can be processed, if at all. And in that situation you will start paying through the nose, which all except the rich cannot really afford if they want to keep using this system.
Bitcoin doesn't care about your political orientation, religious views, gender, race or sexual preference.
This is true.
However, the BTC network will discriminate against you on the basis of you being able to, or not, to pay a very large network fee at times, or it may drop your transaction.
Unless you are persuaded to use some L2 where you are effectively no longer using Bitcoin, but some kind of IOU ("paper bitcoins", to make an analogy), and where things become permissioned and you can easily be controlled and exploited.
Read the book "Hijacking Bitcoin" if you want to know how BTC got into this state.
And do yourself a favor, research why Bitcoin Cash split in 2017 and maintains a Bitcoin protocol and network that works affordably and reliably for anyone who wants to use it. Even if you don't have a lot of money to blow on fees.
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u/Romanizer Jun 30 '25
What motivates institutions or other big players, who mostly do not self-custody to transact anything for a high fee?
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u/joekercom Jul 04 '25
"very few people can use it before it becomes congested" - Yes, and this is why it's going to have a major security problem after the next halving.
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u/OpenRole Jun 30 '25
* if you want to use it as a currency.
As a store of value, bitcoin transaction costs are a non factor. Additionally, you already referenced Bitcoin Cash. Did you also note that in the long term Bitcoin Cash is inflationary relative to Bitcoin?
As far as digital assets go, BTC is the best store of value/hodl coin
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u/LovelyDayHere Jun 30 '25
No, even as a store of value, 99,9% won't be using it *
* not really. In my home custodial use of Bitcoin isn't really using Bitcoin, since you don't know if you will be able to get your coins back in the future. And someone else "hodling" your coins for you is just too beta to even contemplate. If I wanted to use banks, I wouldn't need Bitcoin.
0
u/OpenRole Jun 30 '25
I don't follow. If my bitcoin is chilling in a code wallet that i dont plan to access for the next 10 years, what is the issue?
Also, until taxes can be paid in Bitcoin (which will never happen), you will always need financial intermediaries between crypto and hard cash. Also exchanges do provide an important service even in just crypto to crypto transactions. Financial intermediaries will always be needed, because liquidity is important (unless someone develops a smart contract that can function as an exchange)
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u/LovelyDayHere Jun 30 '25 edited Jun 30 '25
I don't follow. If my bitcoin is chilling in a code wallet that i dont plan to access for the next 10 years, what is the issue?
The issue is, that depending on the number of UTXOs and amounts in them, in 10 years you might not even be able to move them due to fees being more than your savings, or at least taking a very substantial chunk out of them.
Please learn more about this issue right away.
https://unchained.com/blog/small-utxo-bitcoin-dust/
This isn't a concern to the Saylor's and Winklevii of this world, but it sure will affect all the people who are being told that BTC is a usable "store of value" and who put away a few tens of dollars here and there into their cold wallets, believing that one day in the far future, they'll be able to use it.
For the ones who keep meagre hodlings on some centralized exchange, the future looks like: You won't be able to withdraw. The exchange will offer to convert you back to fiat, maybe, or some other crypto or stablecoin that governments like. The BTC will be hoovered up by institutions and you won't be getting back in the game. That's if you're lucky and the exchange doesn't go bust over that time.
until taxes can be paid in Bitcoin (which will never happen)
Ahem, you're not up to date.
https://zg.ch/de/steuern-finanzen/steuern/steuerbezug/taxpaymentswithcryptocurrencies
-1
u/OpenRole Jun 30 '25
The issue is, that depending on the number of UTXOs and amounts in them, in 10 years you might not even be able to move them due to fees being more than your savings, or at least taking a very substantial chunk out of them.
The day the per transaction cost of BTC surpasses that of SWIFT, for a sustained period of 3 days (to match SWIFTS transaction delays), is the day I will start taking this threat seriously. Right now it is theoretical, and I believe the SWIFT network provides a ceiling to how much an individual BTC transaction can cost.
until taxes can be paid in Bitcoin (which will never happen)
Very surprising that Switzerland decided not to join the Eurozone, because monetary control was important to them, but then sacrifice monetary control to accept crypto taxes in crypto. (Taxes being the main tools of monetary control). As far as I know you can't pay your taxes in gold bars, so this move by Switzerland is very interesting. I wonder what drove it.
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u/Fooshi2020 Jun 30 '25
How is BCH inflationary? It has the same 21M SATS max cap.
0
u/OpenRole Jun 30 '25
Price action. Thats why i specified relative to BTC. Inflation is not only a function of supply. Demand for BTC grows faster than demand for BCH
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u/pyalot Jun 30 '25
there is no demand for BTC. people buy it to speculate, not because it's useful for anything. That's a situation that will not persist. Everything useless will eventually regress to be worthless.
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u/DangerHighVoltage111 Jun 30 '25
The costs will ALWAYS price out 99,9% every day if the rich or banks use it as SoV. BTC was turned into a tool for the rich. The dream of people that they have a SoV with BTC is just that: a dream.
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u/Calnova8 Jun 30 '25
Transaction costs for bitcoin are totally insane. Right now every single transaction costs more than 100$ (mining cost+fee). This cost is mostly paid with BTC inflation but this will simply move to fees longterm.
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u/OpenRole Jun 30 '25
The last block mined at time of recording cost a total of 2,737 USD, and contained a total of 2,436 transactions for an average cost per transaction of 1.1236 USD per transaction. For a borderless transaction confirmed within 10 minutes, that does not appear to be "totally insane" to me.
Ninja edit: It also only utilized 1.66 MB out of the potential 4 MB of data available to it, so BCH's 30 MB is cool for future proofing, but at present is not a serious concern
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u/Calnova8 Jun 30 '25
I am sorry but you really do not understand. Currently the mining cost for each block is above 300k$. Most of this is paid for with block reward (=inflation). Divide that mining cost by the number of transactions. Pure insanity.
This is not some random cost that no one is paying. It is being paid for by everyone holding BTC. More than 100USD per transaction.
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u/Quick_Humor_9023 Jul 04 '25
Makes absolutely no sense to calculate it like that.
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u/Calnova8 Jul 04 '25
Yes it does. The only usecase for money is an easy transfer of economic value (either in time or between entities). Money does not have any intrinsic value.
You need to consider how much real assets (with intrinsic value) are burned in order to run the currency. Although cryptobros try to convince everyone of the opposite: fiat is way cheaper if you account for all costs per transaction - even labor cost of bank employees.
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u/Quick_Humor_9023 Jul 04 '25
There is a bit of a difference compared to banking system though. In btc the valuation drives transaction costs if you insist on including mining costs on that. If valuation goes down so do transaction(mining) costs.
Also btc is shit as money. Deflationary money is just bad, non-instant transactions are bad, limited transactions per hour is very bad. But transaction costs aren’t that bad at least at the moment, and I wouldn’t count mining, since miner don’t really care if there are transactions or not, they are just a little extra on top of the reward.
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u/Calnova8 Jul 04 '25
I assume you do not really understand fiat since transaction cost for traditional finance is also mainly driven by its valuation (somewhat in relation to gdp/capita).
If you think BTC is shit as money (I agree) then you should understand that BTC is literally a ponzie. The only thing preventing fiat from being a ponzie is, that it does generate actual economic value due to its efficient transfer. If you take that away - only the ponzie remains.
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u/Quick_Humor_9023 Jul 04 '25
I think we are in some price/cost/value missunderstanding here.
With banking system the cost of upkeep of the system wouldn’t scale down immediately if valuation of some currency goes down(in relation to what?) or amount of transactions falls.
In btc the amount of electricity used for mining and therefore cost per transaction (if you want to include mining, which I wouldn’t) will dive immediately if valuation of btc dips.
Btc also generates definite economical value due to many reasons; possibility of ’anonymity’, possibility of transactions, no regulation of the chain itself, no authority over the chain by single entity, etc. As everyday money it is shit, as a new type of financial instrument we’ll see. Btc itself doesn’t really care about external valuation. So it kinda does look like a ponzi scheme, although there is nobody specifically trying to scam people or claiming some returns. (Yea yea, someone may be, but they don’t represent btc, nobody does, that’s the point)
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u/OpenRole Jul 01 '25
Cost to mine and cost to transact aren't the same thing. As you said, it is paid for by inflation. A cost the entire network pays at a fixed 10 minute interval. Also, cost to mine each block is not above 300k. I literally provided a source that you can look at live mining data, and you're sticking your head in the ground going "nuh, uh"
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u/Calnova8 Jul 01 '25
I feel like you do stick your head in the ground. The exact block you linked has 340k$ subventions+fees. Mining cost very close to that - and actually not even mentioned on the site you sent.
Just today the average mining cost is 107k$ per BTC. That’s even way beyond 340k$ per block. You can see that here: https://en.macromicro.me/charts/29435/bitcoin-production-total-cost
The blockchain is bitcoins network. It’s only objective is to secure transactions. Mining a single block burns real world assets (energy,tech) worth more than 300k. The collective of all BTC currently pay 1 million dollar every half hour. You might not understand how you are paying that („uhh but number goes up?“) but let me explain in an ELI5 manner.
If the bitcoin network cannot convince investors to throw more than 1 million dollar every half hour into the pool, the price goes down. If people throw in more, then price goes up.
The higher mining cost and rewards (valued in USD) rise, the more money you need to throw into the system to prevent BTC price from falling.
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u/OpenRole Jul 01 '25
Okay, you're completely disregarding everything I'm saying to make your point. Mining costs don't matter. What matters is the cost to transact on the network. You're speculating about how mining costs will affect transaction cost. Cost per transaction is about 1.5 dollars.
You keep bringing up mining cost. To understand the cost to move a coin out of a wallet, mining cost is irrelevant. Only thing that matters is the transaction fee.
Don't bother responding, I'm turning off notifications for this thread
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u/Calnova8 Jul 01 '25
Acting like a little child.
Mining cost is relevant. Those are actual assets that are destroyed and paid for.
Same goes for fiat. The cost of transacting fiat is insanely small - even when you account for „mining cost“ (=production, distribution, electricity of banks, staff for banks etc). You have this cost in every currency and it is always paid for by the public that holds fiat.
For fiat this cost breaks down to a few cents per transaction. For BTC its 3-figures.
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u/BrotherDawnDayDusk Jun 30 '25 edited Jun 30 '25
All I see are "ifs" and "whens".
Is "99.9%" using it? Hell no, in fact barely anyone does. Will they ever? Quite unlikely, and if so, it's a long long long way away. Short of the gifted psychics in the room, no one has any idea what will actually happen.
What we instead do know, is that clearly this is not the case today, and in actual fact, it may never be an issue - who could possibly know. This is all obviously just a guess at a very specific future, regurgitated daily, used to sell a story. A guess that a certain use case for some unknown and bizarre reason all of a sudden takes off. A guess that nothing can ever change to help should it actually be truly required. A guess that no new solutions may someday come along. Just a guess to paint a doomsday scenario future based on locking certain factors in place, while changing others - all of choice, all to suit a narrative. And worse, pretending that this is some kind of imminent certainty, instead of the purely fictional guess at an odd future it actually and obviously is.
Someday things may change. But when what and how, no one knows. Evolution and change are factors, both in use cases and technologies. Many things could happen long before we're anywhere remotely near this silly "99.9%" prediction.
Besides, there's BCH anyway. Apparently that solves all of the futures problems today somehow. So no need to worry I guess.
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u/Catholelicker Jul 01 '25
The price and adoption keeps rising but "it got hijacked", by who? And when? Everyone as far as I know is still free to use it, no one's stopping your transactions, stop spreading crap. Layers keep getting built on top of the chain, you don't buy coffee with a shaving of gold, you use cash or debit, it is called a second layer.
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u/jhansen858 Jul 01 '25
Imagine if every time you wanted to buy a bag of m&ms or anything at the store, you opened a new bank account at the bank and then closed it when you were done. That is essentially how bitcoin is used now because its so inexpensive to do so. However it's not a good long term solution to scale. Lightning is like opening the account and using it multiple times like you would for a real bank account. Lightning can easily scale well beyond what our real banking system can do now. Eventually most transactions will be done using Lightning. Stull uses bitcoin but in a more efficient way.
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u/LovelyDayHere Jul 01 '25
Lightning can easily scale well beyond what our real banking system can do now.
You've bought the koolaid.
LN doesn't scale well at all on a small block chain like BTC.
Read the whitepaper.
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u/jhansen858 Jul 02 '25
Sorry friend,
Lightning can currently support hundreds of thousands of TPS and can theoretically scale to millions of transactions per second. https://glossary.blockstream.com/lightning-network/
-- Transactions between parties are conducted off-chain within payment channels, avoiding the congestion and delay of the main Bitcoin blockchain.
-- Since payment channels operate independently and in parallel, many transactions can happen simultaneously across the network.
--Payments are nearly instantaneous, with very low latency compared to on-chain confirmations.
To put this in perspective, visa worldwide peak capacity is known to be about 24,000 TPS
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u/LovelyDayHere Jul 02 '25
That would explain why hardly anyone is using it and about 95% of its users are using custodial wallets.
No, the simpler explanation is that it doesn't work like Blockstream claims.
All you have quoted to me is the marketing shlock. The reality looks very different, because LN scales in the number of transactions, but not in the number of non-custodial users, due to the capacity restriction of L1.
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u/jhansen858 Jul 02 '25
hardly anyone used visa in the 70's. You could have easily made the same arguments about that back then.
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u/LovelyDayHere Jul 02 '25
We have been observing Lightning underperformance for the past 8 years.
At this point even BTC developers are arriving at the consensus that it's failed in terms of scaling Bitcoin as a payment solution.
Bcashers were right about LN ending up as centralized hubs and otherwise failing to scale.
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u/jhansen858 Jul 02 '25
again, you could make the same argument for visa back then.
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u/LovelyDayHere Jul 02 '25
except LN will never be commercially successful unlike VISA.
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u/jhansen858 Jul 02 '25
I crunched some numbers comparing the first 5 years of bankcard the predecessor to visa vs lightning network growth.
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u/icydee Jul 04 '25
The LN may be able to do that number of transactions, but to use the LN a connection has to be made, and closed, with the L1 bitcoin network. I understand that at the moment the connection is opened by a single transaction on the L1, similarly for the close, and that only one connect/disconnect can be made per transaction .
If the LN were scaled to 100% of the world population, then each person would be able to make one connection and one close to the LN in their lifetime because of the 7 transactions per second limit of L1 bitcoin.
(there may be some work in progress to allow multiple connections being made per transaction in which case this argument may not be valid in the future.)
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u/jhansen858 Jul 04 '25
I like to look at opening a lightning channel akin to opening a bank account. So not opening new channels all the time does make sense from that perspective.
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u/icydee Jul 04 '25
So there will be institutions that open channels, they will have control of it thus negating the idea of decentralisation and pseudo anonymity
1
-4
u/DreamingTooLong Jun 30 '25
It cost $.60 to do a $31,000 transaction on the Bitcoin Blockchain
At the local bank, they’re charging $15 to do a wire transfer and it’s not even as fast as a bitcoin transfer.
It does a fine job for people that do large transactions.
People that do small transactions are usually on food stamps and they get all their money for free from the government anyway and it’s put on some plastic card that reloads every month. I highly doubt the government will ever hand out bitcoin to people that need food assistance that just doesn’t make any sense. Especially when they can just print digital money out of thin air and stick it on a plastic card backed by taxpayers.
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u/frozengrandmatetris Jun 30 '25
it costs $0.60 right now because a huge chunk of the userbase ran away to custodial solutions and alternative blockchains after experiencing much higher fees. it does not always cost $0.60, and even if it did, given the blocksize constraint, that's not going to be enough to fund the security budget in a few halvings. it cannot and will not stay at $0.60 or the system will fail.
-3
u/DreamingTooLong Jun 30 '25
It cost that price every day of the week
It’s never going back to December 2017 transaction fee prices
It never happened November 2021 and it’s not going to happen October 2025
A lot of people today can just call their Fidelity stock broker and move their bitcoin assets without doing anything unchained whatsoever.
There’s now side chains like liquid and lightning network.
All these different options pegged to the price of bitcoin keeps the transaction fee down for the people that actually use the Blockchain.
I know this is not a reality that you want to face but eventually, you need to wake up and realize this is not a hill worth dying on.
Bitcoin does what you want it to do. It’s just not doing it exactly the way you want it to be done.
Bitcoin is here forever and it’s probably not gonna change much.
BCH made the terrible mistake of not being pegged to the price of BTC. If BCH would have done that there would’ve not been a lightning network or WBTC on a dozen different chains.
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u/haight6716 Jun 30 '25
There is literally wbtc on the bch chain. You are one of the new "number go up" btc users. The OGs are here to avoid custodians and fractional reserve banking. BCH keeps that vision alive. BTC has become what it was trying to replace.
"Chancellor on the brink of second bailout for banks."
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u/LovelyDayHere Jun 30 '25 edited Jun 30 '25
People that do small transactions are usually on food stamps
Nonsense.
Below is some real (US) economic data. Most transactions are small, certainly nowhere near the multiple thousands of dollars.
The average credit card payment by a business — $259 — is almost three times the size of the average credit card payment by a consumer at $78
Like credit cards, the average value of a prepaid card payment by a business — $114 — was more than three times the size of the average prepaid card payment by a consumer at $34.
The median payment size will be lower than the average.
Consumers made an equal number of cash and debit card purchases for payments under $25 (2024 Findings from the Diary of Consumer Payment Choice)
Now consider what happens when BTC average fees rise as they have in the past, and are supposed to in the future.
Fees of $25, $50, $100 and even higher for a transaction have been seen during times of high load. And BTC figureheads are talking about future fees of $1000/tx or more. Just to keep the chain secure.
That's NOT competitive with banking instruments.
Even if you argue that it's still economical for large-amount transactions -- that just confirms in future the usage will be shifted towards excluding most people.
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u/DangerHighVoltage111 Jun 30 '25
The fees will ALWAYS price out 99,9% every day if the rich or banks use it as SoV. Because that is it's capacity limit. if you have less than 0.1% interested in transactions you are lucky and get a cheap fee. But if banks or rich people jump on you will run out of luck forever. That's the trap they set to turn it into a tool for the rich an exclude the 99.9% poor.
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u/GreemBeam Jun 30 '25
If BCH received as much (or more) traffic than BTC, the blocksize would become so huge that it can only run on cloud providers with huge hosting costs, resulting in centralisation.
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u/Trick_Dragonfly460 Jun 30 '25
You generally will need more powerful hardware to run a BCH node than BTC, that is a fact.
But no, not the size of a cloud provider, that is pure hyperbole.
But let's entertain this view anyway. Let's imagine you need an entire data center, or to rent a 100k-USD cloud service, (which again is FAR from the truth), to run a Bitcoin Node.
This (erroneous) scenario is STILL better than BTC.
Why? Simply don't you think it's better to allow 99% of the people to transact on-chain even tho only 1% can run a Node?
BTC has this backwards already. 99% of people can run a Node, but only 1% can transact on-chain. Please entertain me on how that is not ass-backwards?
-2
u/GreemBeam Jun 30 '25
Taproot with small blocks is more than adequate. I simulated a large transaction (5000 inputs, 25000 outputs). 6.8MB with SegWit, 366kb in Taproot.
There could be a wallet client that pools all transactions and sends them as a batch. This could be done in a way to not only reduce fees but also increase privacy.
Thing is there just isn't enough traffic to warrant such developments currently.
Big blocks (to the extent of BCH) will only result in bad actors systematically bloating the size to centralise the chain completely.
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u/LovelyDayHere Jun 30 '25
Big blocks (to the extent of BCH) will only result in bad actors systematically bloating the size to centralise the chain completely.
Hasn't happened anytime in the last 8 years, despite the potential threat actors being rich and competent.
The attack isn't economical for them.
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u/DangerHighVoltage111 Jun 30 '25
BTC talking points repeated ad nauseum without fact checking:
- 1MB is enough.
- There is no traffic so we don't need to scale
- Big Bocks will lead to centralization
- Big blocks will bloat.
Facts:
- It is not, not even for LN or any other L2s
- There is no traffic because it refused scale and killed all the adoption momentum.
It won't, because running a node will always be an insignificant cost compared to mining equipment. Like buying pens for the office.
False, bad code with faults or enabling bloating will bloat the chain.
From today on I think I will add a counter to this reply: Count: 1
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u/haight6716 Jun 30 '25
... as Satoshi intended. Large miners, many light clients. Decentralized, but not in your basement: among large miners - Byzantine generals.
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u/DangerHighVoltage111 Jun 30 '25 edited Jun 30 '25
Did you run the numbers? Because I did. You are just repeating nonsense that you heard from other people.
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u/GreemBeam Jun 30 '25 edited Jun 30 '25
If you're talking about what I said with regards to Taproot, I did run the numbers using Electrum Wallets "send to many" feature with the help of AI to write the script
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u/DangerHighVoltage111 Jun 30 '25
I'm not talking about the tapworm. I specifically replied to this:
the blocksize would become so huge that it can only run on cloud providers with huge hosting costs, resulting in centralisation.
Did I not?
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u/camylopez Jun 30 '25
Bs
How is it that bch would but btc isn’t?
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u/solenico Jun 30 '25
BTC does not have dynamically allocated block size. That’s the whole point here.
It is true that bigger block size does require bigger servers to handle the load.
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u/camylopez Jun 30 '25
He states “as much” trafic as btc
-2
u/solenico Jun 30 '25
When there’s “as much traffic” BCH block size hits the upper limit 32MB whereas BTC still has fixed ~4MB.
Indeed the first need juicier servers which is known difference from the design board to reality.
Also notable is the fact that BTC has evolved with soft forks both introducing Native SegWit and more recently TapRoot which both addresses a lot of issues with legacy BTC.
Not saying BCH doesn’t have its place, but a lot has changed from 2017.
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u/camylopez Jun 30 '25
Explain it to me like I’m 5.
Btc has two meg of block data going every ten mins.
Bch matches that with 2 meg of data, but file blocks up to 5 meg instead
-1
u/solenico Jun 30 '25
If both have 2MB block data then there’s no congestion is there?
Assumably both would have plenty of resources and no real difference and fees would be low for both although tad lower for BCH but difference would be more like cent or two BCH being under 1c as it typically is anyway.
I’m not an expert here but during if peak hours the fees sending BTC are low and transactions happen in minutes.
BCH does handle transactions faster even when congestion and fees are lower, but the miners need to be beefier which was the claim – not done by me but I agree with it, since handling bigger blocks will need more horse power.
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u/LovelyDayHere Jun 30 '25
but the miners need to be beefier
No, miners are unaffected. You mean pools ?
They would only need to upgrade their hardware when BCH is doing MUCH, MUCH more transactions than 32MB blocks.
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u/solenico Jun 30 '25
Larger blocks mean miners (full nodes that validate and propagate blocks) must process, store, and transmit more data per block than in BTC. This requires:
- Higher bandwidth: To propagate 32MB blocks quickly across the network.
- More storage: To store the blockchain, which grows faster with larger blocks.
- More processing power: To validate transactions in larger blocks (e.g., verifying scripts and signatures).
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u/LovelyDayHere Jun 30 '25
Higher bandwidth: To propagate 32MB blocks quickly across the network.
It's marginal, because -- don't know if you know this -- the full block contents are only transmitted very infrequently due to technologies like Compact Blocks and Xthin which save like, > 95% of block contents from being transmitted. Nodes actually validate the transactions long before a block arrives, in most cases.
More storage: To store the blockchain, which grows faster with larger blocks
Pruning exists on BTC and BCH.
Even miners don't need to keep around all blocks forever. Very few nodes do (mainly those serving block explorers, specialized indexers, etc.)
More processing power: To validate transactions in larger blocks (e.g., verifying scripts and signatures)
I repeat, my RPi can keep up with a hundred TPS without breaking a sweat. That's more than 10x what BTC does on a busy day, and it works on the lowest end, cheapest hardware even people in 3rd world countries can afford.
Any not-so-expensive gaming computer or business server could do much more.
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u/DangerHighVoltage111 Jun 30 '25
Larger blocks mean miners (full nodes that validate and propagate blocks) must process, store, and transmit more data per block than in BTC. This requires: - Higher bandwidth: To propagate 32MB blocks quickly across the network. - More storage: To store the blockchain, which grows faster with larger blocks. - More processing power: To validate transactions in larger blocks (e.g., verifying scripts and signatures).
That's like saying it does not work, because you need to buy fancy pens for the office. Mining equipment is magnitudes more expensive financing a node or two makes no difference.
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u/camylopez Jun 30 '25
Then what are we arguing about.
We both call BS on his story
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u/solenico Jun 30 '25
The bigger block size requires more performance from the servers. This is actually well described on the book “Hijacking Bitcoin” which is pro BCH.
I’m not disagreeing with anything basically. Except TapRoot actually does perform fast and with low fees. Not just as fast and as low fees as BCH 🫡
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u/camylopez Jun 30 '25
Except with equal transactions we don’t have bigger blocks
Taproot is marginal fee reduction at best. There is improvements when consolidating a taproot address, but given that many wallets don’t send to taproot ñ, most dust isnt in taproot utxo’s
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u/LovelyDayHere Jun 30 '25
No servers have to be upgraded to handle the occasional traffic spike even up to 32MB blocks.
This runs fine on my Raspberry Pi, even better on an old laptop or home PC.
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u/solenico Jun 30 '25
I’m sure it makes you feel participated.
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u/LovelyDayHere Jun 30 '25
Point is, the narrative that you need powerful servers for ... 8x the capacity of BTC ... is very wrong and uninformed. People who claim that have never run a BCH node.
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u/solenico Jun 30 '25
You honestly think BCH Network would run at all with a bunch of Rasberry Pis? Just that you can get your pi connected to pool or solo mining doesn’t mean it contributes anything significant.
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u/LovelyDayHere Jun 30 '25
The BCH network is a lot more than just "full nodes".
Some nodes need to be beefier because they're not just doing p2p, but serve RPC and other services.
Obviously one could not get all the services to run just on Raspis, but a functional node network, even with SPV servers? Yes, you could. But I'm not advocating that. I'm saying that the narrative that you need extraordinarily powerful servers, is misleading.
A BCH node might be using a few percent of CPU at best, most of the time.
Only when there is large load on the network, or huge blocks to validate, will it consume more.
My RPi 4 keeps up fine even with many, many more TPS than BTC ever does.
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u/GreemBeam Jun 30 '25
1MB is the size limit if you look at the source code. The responses here are so wrong it's funny to me
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u/camylopez Jun 30 '25
It doesn’t matter what the limit is,
If equal, btc was matched with bch, you you have 1 meg block sizes on both chains.
Also we haven’t had 1 meg blocks in 7 years unless it was a half empty block.
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u/solenico Jun 30 '25
2010 yeah but the limit was replaced already 2017 when BTC moved to SegWit.
In the current Bitcoin Core source code (e.g., version 27.0 as of 2025), the block size is governed by the MAX_BLOCK_WEIGHT (4,000,000 weight units), not a strict 1MB byte limit.
You made me chuckle too.
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u/GreemBeam Jun 30 '25
The limit wasn't replaced.
There is still only 1mb of ACTUAL data that fits into a block. There have been softforks which strip the headers of transactions to make them smaller, so the metric they now use is MvB.
To replace the hard-coded 1mb limit of data that fits into a block would require a hard fork.
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u/solenico Jun 30 '25
You’re wrong. For a block with only legacy (non-SegWit) transactions, the base size is still capped at ~1MB, as these transactions don’t benefit from the witness discount. However, modern blocks include SegWit transactions, so the total block size (base + witness) often exceeds 1MB, up to ~4MB. Your claim is misleading because it implies a universal 1MB limit, ignoring SegWit’s impact.
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u/GreemBeam Jun 30 '25
SegWit / Taproot do not allow more data into the block. They decrease the memory size of a transaction and this "often exceeds up to 4MB" your talking about is the equivalent theoretical size this transaction would be taking up if it had not been stripped.
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u/CourseDazzling9537 Jun 30 '25
If you use an exchange you can buy instantly from a pool which gets settled later. Since the settling on the exchange side is done later with a large sample of other transactions the fees will be far less than this future on chain fee. The same for layer 2 which is BTC backedand possibly a tiny tiny fee. The L1 has to be this way for scarcity and security, aka decentralization.
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u/LovelyDayHere Jun 30 '25
Not your keys, not your coins.
The L1 has to be this way for scarcity and security, aka decentralization.
Wrong. L1 on Bitcoin can be scaled extremely well.
Decentralized exchanges are even more decentralized than the centralized exchanges which "settle later" (i.e. sell you coins they might not even have) :)
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u/haight6716 Jun 30 '25
Fees on LN are actually higher than on the base layer now.
LN is not scalable if used non-custodialy. LN nodes need to charge high fees to compensate for the risk of keeping funds in hot wallets (such a dumb design).
Resulting in a lot of custodial activity, little on-chain use, reducing fees there - no more on chain scarcity. LN robs the main chain of fees by funneling users into custodial wallets.
The main chain loses transaction fees at the same time the block reward declines. Mining revenue is reduced, hash rate drops, security decreases.
It's probably too late to reverse this trend. Aaand were back to the fractional reserve banking system we were trying to replace, congratulations.
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Jul 01 '25
[deleted]
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u/LovelyDayHere Jul 01 '25
Welcome to Reddit.
I appreciate that you emerged from r/Bitcoin, where you write things like:
CBDC = currency (steel, paper) ₿itcoin = money (gold, silver)
Maybe it would interest you that the person to release Bitcoin explicity characterized it as a currency in his release announcement.
The Bitcoin whitepaper also explicitly compares Bitcoin to physical currency, noting that Bitcoin introduces a novel way to
make payments over a communications channel without a trusted party
That will be all for today.
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Jul 03 '25
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u/LovelyDayHere Jul 03 '25
It's still far from being money.
In BTC's case, that goal even seems out of reach.
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u/anderspatriksvensson Jun 30 '25
Use wBTC in Ethereum. Best version of Bitcoin is an Ethereum token.
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u/Realistic_Fee_00001 Jun 30 '25
Satoshi just grabbed his heart and fell over dead.
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u/anderspatriksvensson Jun 30 '25
He did that long ago when Bitcoin devs choose not to scale the protocol 👍
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u/haight6716 Jun 30 '25
Or Solana or avax or even bch has wrapped btc tokens now. BTC chain is dying, miners will lose more and more revenue, eventually security will be too low and the big custodians will take it over and shut it down, then BTC will be another asset traded in the regular banking system.
But hey, ngu! We're all rich! Who cares about the original goals of usable cash for the masses. Let them use stablecoins.
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u/mrjune2040 Jun 30 '25
The narrative of 'large network fees' is disingenuous at this point. Via Btcinfocharts, the median Bitcoin transaction fee today: $0.297. For the previous 3 months, $0.393.
The fundamental disagreement is always going to revolve around the purpose of BTC in 2025—your argument only makes sense in the context of Bitcoin being primarily a p2p cash tool (which it isn't). Fwiw—there's zero point in debating this point because we both know where each of us stand, but we can breakdown why your overview fails to address the tangible benefit for BTC users who do use Bitcoin as an SoV.
For the vast majority of people moving their BTC on-chain at this point they are essentially moving their savings‚ because it's primarily utility in 2026 is as an SoV. The real fee structures to compare to are banks and money brokers. The very cheapest money broker (typically XE) has a spread in the range of 1.5% for international transfers, and even more at the low end given additional minimum fee thresholds (typically around $3). Banks have an even poorer spread, and typically higher wire fees (sometimes for both sending AND receiving) in the realm of $10-30. I send a ton of money around the world each year for my business so I know this world well.
So at the low end, let's take someone moving $30-100 which might amount to a tangible amount of savings for someone in a poorer nation—a fee of $0.297 represents a fee just south of 1%, and becomes lower in percentage terms for every transaction amount above that. At $30 via a money broker you're paying $3+spread on that $30 for an international transaction, so around $3.30, that's 11x the BTC for the same amount.
At the high end, those differences become much much smaller, because you're basically only competing with that 1.5% spread. At 50k a BTC fee at $1 equates to a 0.002% fee. On a personal note I've made multiple transactions between 6-7 figures for between $2-3 over the years—laughably low.
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u/camylopez Jun 30 '25
“Median btc fee” When your avarage person is paying $23 per transaction to withdraw of an exchange, but they consolidate at 1 sat
There is a very biased perspective here when you who know better explain it like this to those that don’t know better.
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u/mrjune2040 Jun 30 '25
Exchange fees are not Bitcoin fees. Just as exchange fees are not BCH fees. And citing median fees is always the most honest picture of any protocol because it actually shows what most people are paying, rather than a dataset average skewed by small/large fee transactions.
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u/camylopez Jun 30 '25
I said “withdraw from an exchange” I know the different fees for using an exchange.
If we are talking about a currency that is investment driven, then the largest fee set people are going to be slugged with are exchange withdraw fees.
Consolidation fees are a large chunk of what’s being processed since the blockchain has cleared, so again they clearly thwart the median avarage.
When there are two different demographics here using it, quoting the median to retail investors is dishonest not honest
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u/aquila54 Jun 30 '25
I’m just trying to learn but wouldn’t fees have to rise in the future as the block reward dwindles to keep the network secure?
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u/Trick_Dragonfly460 Jun 30 '25
You've hit the nail on the head. BTC has been driven to a point where not utility, but a need to have an increasing price, is what drives its increases in price.
I don't know about you, but that model does not seem very reasonable to me.
You instead, seem like a reasonable individual, asking hard-hitting questions and thinking critically. Keep that up, and you will naturally lead yourself to worthwhile projects. Imo BTC isn't one of them, unless you want to gamble that you won't be the last fool.
Also avoid r/Bitcoin with a 90-foot pole. That is probably the single worst cryptoreddit with the most horrendous and blatant censoring and narrative-curated content of them all. Confusingly in the sub you're on, r/btc, you will encounter mostly BCH supporters, so there is a bias in here, but it's a million times better already because you can freely and openly criticize and argue against BCH here, something that will get you banned in r/Bitcoin if you meaningfully criticize BTC.
Because BCH supporters know BCH is better and does not need a fragile narrative to protect it against cold hard facts.
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u/mrjune2040 Jun 30 '25
The network will always self-adjust, as it has always done, and as it was designed to do. The block reward in 10 years time will be less, but BTC will be worth magnitudes more—miners will participate as to their own profit threshold, some will go, some will stay, some will join. And in the long-term future it will be increasingly prudent for parties with vested interests in the security and decentralization of the network to participate on security terms alone (even beyond the time when block rewards are done, and miners are only chasing fees).
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u/DangerHighVoltage111 Jun 30 '25
Yes that is the BTC Core concept: few transaction with exorbitant fees.
The Bitcoin concept is: millions of cheap fees. Same reward much more utility.
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u/DangerHighVoltage111 Jun 30 '25
The narrative of 'large network fees' is disingenuous at this point.
No it is not. We are just in the "See BTC works" phase. As soon as fees skyrocket again you will be here telling us that this is good for security and we are just a bunch of whiny b*tches
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u/r_a_d_ Jun 30 '25
This… BTC is a store of value and is working as intended. BCH wants to be digital cash like many others…. Fine.
However, I don’t understand how anyone can argue that BCH will gain any value even if it succeeds in this mission. It’s not a SoV, it’s a functional token for transmitting value. Unlike Bitcoin, there’s no correlation between its value and adoption.
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u/LordIgorBogdanoff Jun 30 '25
Network effect and siphoning "market share" (for lack of a better word) from fiat currency.
Also wrong, with everything there is a correlation between adoption (or popular use) and value. Also,, there is no mechanical or technical SoV property.
You're a victim of propaganda.
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u/r_a_d_ Jun 30 '25
The use of the BCH network is not tied to the value of the BCH token if you are only using it as a transfer mechanism rather than actually holding the token as a SoV. It’s not marketing, it’s fact and the market confirms this theory. You are a victim of this echo chamber.
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u/LordIgorBogdanoff Jun 30 '25
Yes it is (if not used for transfer of wealth, what else would it be used for besides a pet rock?). Also, using it as my savings account (aka "holding it as an SoV" for later) is not mutually exclusive from using it as a transfer mechanism? I do both.
BTC cannot be used for the latter due to artificially restricted throughput, only the former (and in the event it was adopted more, you'd be priced out of transacting). Also, "the market" is both manipulated (tether) and never stops deciding.
Therefore, BCH > BTC
Also, echo chamber? You're allowed to post pro-BTC stuff here, you'll just get pushback. Try posting big blocker stuff on r/Bitcoin and see what happens. You have reality backwards due to price action clouding reality.
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u/r_a_d_ Jun 30 '25 edited Jun 30 '25
Whether you personally do it, or the general market does it, is all the difference.
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u/typeIIcivilization Jun 30 '25
I’m just now getting into bitcoin and I was super excited about what it meant given my new understanding of fiat currency and fractional reserve banking. Now I’m getting deeper into it and reading more about the 2017 switch to the seg wit protocol and understanding this is going to impact decentralization in the future.
Where can I read more about this? Is bitcoin essentially useless as a store of value in the long term now? Are you no longer a proponent of btc yourself?
It seems difficult to get decent info on this and most people on Reddit still seem excited about bitcoin and that it is that store of value we are looking for.