Why is Bitcoin so slow?

[wamatt]

This has probably been asked before. But I keep seeing "Bitcoin allows instant transfers anywhere in the world" repeated in the press. However my experience is that it can take 10 minutes or even much longer.

Why is this? Will it ever improve? How can we make it truly instant? (<5s)

The benefits should be obvious.

[nobbynobbynoob]

It's pretty much instant if you accept zero-confirmation payments. If you need the double-spend security, you wait.

[wamatt]

It's pretty much instant if you accept zero-confirmation payments. If you need the double-spend security, you wait.

Except that merchants and others are probably unlikely to trust zero-confirmation payments. So any ideas on if this will improve?

[kerogre256]

It's pretty much instant if you accept zero-confirmation payments. If you need the double-spend security, you wait.

Except that merchants and others are probably unlikely to trust zero-confirmation payments. So any ideas on if this will improve?

Why ? What is chance then somone who paid 0.00001 bitcoin for coffe try pull double-spendig on Costa ?

[meanig]

It's pretty much instant if you accept zero-confirmation payments. If you need the double-spend security, you wait.

Except that merchants and others are probably unlikely to trust zero-confirmation payments. So any ideas on if this will improve?

There are several ways to reduce the risks of zero-confirmation payments. The easiest is to just wait a few seconds and have a well connected node. After ten seconds a non spam transaction with a small fee should have been seen by the majority of the network and the chances of a double spend are greatly reduced.

[Foxpup]

Except that merchants and others are probably unlikely to trust zero-confirmation payments. So any ideas on if this will improve?

They trust credit cards, and credit card transactions usually aren't settled until the end of the day (and sometimes they take even longer). And even then the transaction can be reversed at any time. That makes zero-confirmation Bitcoin payments better than credit cards.

[FreeTrade]

There are several ways to reduce the risks of zero-confirmation payments. The easiest is to just wait a few seconds and have a well connected node. After ten seconds a non spam transaction with a small fee should have been seen by the majority of the network and the chances of a double spend are greatly reduced.

That's the situation as it exists right now.

I think we have to assume that miners will start to facilitate double spends where it is in their financial interests to do so. I mean, where the second transaction has a higher transaction fee, currently it will be rejected, but in the future it may be preferred.

What will merchants do? I think they'll need third parties (such as Bitpay) to insure the transactions for a small fee. How will third parties insure the transactions? I think they'll seek guarantees from mining pools that they will attempt to include particular transactions.  All of this can happen in a few seconds.

Merchants can have guaranteed instant confirmation, but it'll come with a small fee.

[ChristianK]

I think we have to assume that miners will start to facilitate double spends where it is in their financial interests to do so. I mean, where the second transaction has a higher transaction fee, currently it will be rejected, but in the future it may be preferred.

A miner loses a lot of money if his block doesn't get accepted by other miners.
It possible to have a miner consensus to reject blocks by miners that facilitate double spending.

[acoindr]

I believe a large part of the solution, which will evolve naturally, will be off-chain transactions. You may want to see my post on it:

https://bitcointalk.org/index.php?topic=146896.0

...
I've said off-chain transactions should exist with Bitcoin. Primarily I had scalability in mind, but also think of the progression of money. People once traded physical gold. People then traded claim checks for the gold instead since that was more effective (easier to carry, not subject to shaving, etc.). Today we use credit cards, PayPal and other methods to trade digital claims on paper dollars since that's even more effective than trading the paper.

...I've also had a far simpler transfer method in mind which I call Bitcoin Clearing Houses (BCH).

A BCH starts with an entity that can garner general trust, say MtGox, Blockchain.info, the Bitcoin Foundation, etc. The BCH sets up a server with website interface allowing users to register with email addresses and deposit or withdraw bitcoins. Those transfers take place on-chain. However, since the BCH is widely visible many other users and merchants could also have accounts there. Then coin transfers happen within the BCH, or between multiple ones. A BCH also provides an API so that eWallets like WalletBit or MtGox can pass on transfers from their members without the members having accounts at the BCH.

Using a BCH has obvious advantages. Transfer is instant, no waiting for confirmations. Transfer is free or very low cost (profit might come from ads or features). Finally, of course, is scalability is helped greatly. (people could also send to email addresses eschewing wallet addresses)

[DastanX]

+1 on that

[BTCisthefuture]

Except that merchants and others are probably unlikely to trust zero-confirmation payments. So any ideas on if this will improve?

They trust credit cards, and credit card transactions usually aren't settled until the end of the day (and sometimes they take even longer). And even then the transaction can be reversed at any time. That makes zero-confirmation Bitcoin payments better than credit cards.

Credit cards are backed by banks and insurance though. You have a safety net.  Bitcoin doesn't have that. 

I feel one major growing pain with bitcoin right now is the fact that you can't dispute transactions. Someone steals your bitcoins and spends it, too bad. Someone steals your credit card and spends it you can dispute it.

And I agree that the wait time is too long for transactions. Recently most my bitcoin transactions take about an hour, if bitcoin is going to be a currency it shouldn't take that long. especially if theres nothing backing the transaction.

[ChristianK]

I feel one major growing pain with bitcoin right now is the fact that you can't dispute transactions. Someone steals your bitcoins and spends it, too bad. Someone steals your credit card and spends it you can dispute it.

Depending on your perspective this is a feature or a bug.

If you get payed than you find that it a feature that there no way to dispute transactions.

[virtualfaqs]

Except that merchants and others are probably unlikely to trust zero-confirmation payments. So any ideas on if this will improve?

They trust credit cards, and credit card transactions usually aren't settled until the end of the day (and sometimes they take even longer). And even then the transaction can be reversed at any time. That makes zero-confirmation Bitcoin payments better than credit cards.

Credit cards are backed by banks and insurance though. You have a safety net.  Bitcoin doesn't have that. 

I feel one major growing pain with bitcoin right now is the fact that you can't dispute transactions. Someone steals your bitcoins and spends it, too bad. Someone steals your credit card and spends it you can dispute it.

You mean accepting credit card from a stranger you know nothing about? You have a safety net. It's BTC. Look either the merchant has protection or the consumer does. There's no court or lawsuits to decide when it comes to BTC.