With possibly better I meant that you should explain why we should focus on sidechains, but not for something like Lightning Network (a single example). In order to establish a strong thread you should have listed out potential solutions and argued why sidechains are better. That's why I was aiming at.
Lightning Network is important. But it is for resolving other problem: scalability, to increase it on many orders of magnitude. It is not needed yet and if the problem I was discussing won't be solved, it will never be needed. If we won't be able to conquer new niche markets, we'll never need more than 8Mb blocks.
As for other solutions, I'm not aware of them. There are some projects aimed at some specific niches, but there is no project that would enable to attack them all. The sidechain is the only one, there is nothing to compare it with.
I believe that transaction volume in USD prices is the best measure to see bitcoin market penetration. People use bitcoins to transfer value. If price of bitcoins halves, they would need twice as much of bitcoins to transfer the same value. That's why number of bitcoin transacted is bad measure of market penetration. The amount of transaction is even worse in this respect, since the same value can be send by one transacton or by 1000 transactions. USD volume is the best measure. (I agree that inflation-adjusted USD would be better, but so slightly better, that we would need a magnifying glass to see the difference between adjusted and non-adjusted graphs.
Because the graph shows growth in many orders of magnitude, while $ value have changed on some % for the period). When bitcoin was gaining new markets (i.e. new groups of people were switching from fiat transactions to btc transactions) we saw the USD volume was jumping new step on the staircase. There were six steps so far. I cannot exactly identify for which market which step was responsible, but I can name following markets: drug trade (thanks Silkroad), gambling (thanks SatoshiDice), trading (thanks Gox), trading in China (thanks Chinese exchanges). Each of these markets gave us usd transaction growth in range of order of magnitude. But for the last 2 years nothing of the kind happens. There is some growth, but nothing comparable to the previous staircase. We have stopped gaining new niche markets, and to resume it, we have to change Bitcoin somehow. Sidechains is the only solution of this problem I'm aware of.
6. What are the benefits of fiat exactly?
The major benefit of fiat is network effect. You can use USD at any place over whole country. Everybody accept them. While to earn or spend, say, Mongolian Tughrik in New York you would have a lot of hassle. The same is true about bitcoin. To justify this hassle, you would need some really good benefit of bitcoin over fiat.
The benefits of Bitcoin might not justify it for the average person, but I'm not an average person and thus disagree (for myself, not in general).
You already have bitcoin. You are old market. While we are talking about entering new markets. So we need to find a new market, i.e. a category of people that don't use Bitcoin now and change bitcoin in such a way that they would want to use it. If this would work, we should repeat it again, for some other and larger markets. Or we can introduce sidechains and do it simultaneously, for many markets at once, in a hope that at least one of them would fire. It would improve chances and speed of the mainstream adoption.
13. I don't want an array of currencies.
You not only want it, you are currently using at least 3 non-competing currencies. I mean 3 forms of dollars: change, bills, electronic accounts. Each form is good for some purposes, but bad for others. Dimes are not convenient to buy a car with, but are good to pay to a street musician. Electronic account is good to automatically pay rent/mortgage, but not good to pay "under the table". And so on. That's why we have those different "avatars" of dollar. Sidechains will create the same system for bitcoin, only better one: more forms of bitcoin, better tailored for each purpose.
You haven't even explained what a sidechain is (for those that do not know).
You are right. I assumed everybody here knows it.
OK, for the purpose of this discussion it's enough to know what sidechain would let us to develop new forms of bitcoin, interchangeable into each other, like physical 100-dollar bills can be always changed to dimes and back, without losing it's value. There is no limit to number and variety of possible bitcoin forms, so they can be precisely tailored to each market. The switch between them can be handled by your wallet, you may not even need to know about it. You just take from your wallet item you currently need, be it a dime or $1000 bill. When needed, the wallet will break your $1000 bill into dimes or merge the dimes back or convert them to any other form you would need.
I'm asking for more of a technical analysis (if you can provide one).
There are already technical threads, dedicated to it. This thread is about market analysis. My goal was to demonstrate that to significantly increase bitcoin's market share we need to transform it into an array of non-competing currencies. Sidechains is the only project aimed at it.
Anyway, I'm glad that our positions are closer than I thought.
