Competing with Visa in ability to handle X transactions per second...

[commandrix]

The TL;DR of this article on NewsBTC is that Bitcoin will have to be able to handle tens of thousands of transactions per second if it wants to seriously compete with credit cards. Increasing the block size may not be enough with a 10-minute block time and, as we saw with the recent issue with some transactions not getting processed very fast, the transaction fees are also a concern. Of course it would be unfair to blame "greedy" miners when mining hardware is expensive and so is the electricity required to run them. Just something to think about.

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[Lauda]

Well, the article has some false information. It says that the network is currently able to process 7 TPS, and would be able to process 27 TPS with a 4 MB block size limit. This is false. Realistically we are looking at a TPS of around 3 right now, so with a 4 MB block size limit we would look at ~12 TPS. I'm actually wondering how people aren't aware of this and don't understand that Bitcoin can never come close to Visa (if we focus on scaling via the block size limit).

Let's say that 700 million people use Bitcoin (that's ~10% of the World population), and that they all make only 1 transaction per day. Transaction size is averaging half a kilobyte today (source Bitcoin Wiki).
700 million transactions * 0.5 = 350 million Kilobyte = ~350 GB/ 144 (blocks per day) = ~2.4 Gigabyte per block. This is only if they make a single transaction per day (which is unlikely, as the average would be much higher with adoption on this scale).

[European Central Bank]

Never gonna happen with the main chain no matter what you do surely? It's too much of an ask and internet speeds and hardware could never keep up. There's some seriously clever people out there thinking things over so i'll leave it to them to come up with potential ideas.

[Lauda]

Never gonna happen with the main chain no matter what you do surely? It's too much of an ask and internet speeds and hardware could never keep up. There's some seriously clever people out there thinking things over so i'll leave it to them to come up with potential ideas.

The Lightning Network seems to be the best proposal so far that should enable a much better way of scaling. IIRC it should be able to 'accommodate' 30 million users with a 1 MB block size limit (according to the wallpaper).
Update: Removed faulty statement. I apologize for this mistake.

[hv_]

Just found that, but have no clue (sorry). Anybody know about?

http://bitcoinist.net/bigchaindb-the-scalable-blockchain-database-for-securing-diamonds-and-more/

[Randian Hero]

Never gonna happen with the main chain no matter what you do surely? It's too much of an ask and internet speeds and hardware could never keep up. There's some seriously clever people out there thinking things over so i'll leave it to them to come up with potential ideas.

According to Moore's law, Bitcoin could actually handle it on the main chain before we die of old age. Given that the 1 MB block size limit anti spam constant is removed. Bitcoin was meant to run without it.

[Lauda]

According to Moore's law, Bitcoin could actually handle it on the main chain before we die of old age. Given that the 1 MB block size limit anti spam constant is removed. Bitcoin was meant to run without it.

This is wrong. Please don't create such statements when you have insufficient knowledge (it is much smarter to do more reading and learning). Moore's law is not the only constraining factor involved here; additionally it is dying. Bitcoin was not meant to be run without a block size limit.

Just found that, but have no clue (sorry). Anybody know about?
http://bitcoinist.net/bigchaindb-the-scalable-blockchain-database-for-securing-diamonds-and-more/

This is the first time that I'm hearing of this. Initially I thought that it was centralized for sure and wanted to disregard it, however after doing some more research it seems to be decentralized.

Rather than trying to scale up blockchain technology, BigchainDB starts with a big data distributed database and then adds blockchain characteristics - decentralized control, immutability and the transfer of digital assets.

I'm not sure what to make of this.

[FinalFantasy]

If bitcoins succeed I predict that the banks will just copy the blockchain for their own purposes leaving us with our worthless coins.

[European Central Bank]

According to Moore's law, Bitcoin could actually handle it on the main chain before we die of old age. Given that the 1 MB block size limit anti spam constant is removed. Bitcoin was meant to run without it.

I thought Moore's law had pretty much ground to a halt. I ain't seeing too much progress these days. And internet speeds depend on governments and phone companies to add new hardware and cables and dig stuff up. Their bottom line is more important than making a theory come true.

[calkob]

Why does bitcoin have to compete with visa, how ever said it was designed for such a purpose?  Is it not greater than just a payment system?

[johnyj]

Now the bandwidth record is 255Tbps, to handling that kind of traffic on chain will be a piece of cake in 20 years

http://www.extremetech.com/extreme/192929-255tbps-worlds-fastest-network-could-carry-all-the-internet-traffic-single-fiber

I'm afraid the growth of bitcoin users will be much slower after majority of IT aware people are on board, and that will happen as early as next year: It takes decades to get one generation of people that is enough IT literate

[hv_]

Now the bandwidth record is 255Tbps, to handling that kind of traffic on chain will be a piece of cake in 20 years

http://www.extremetech.com/extreme/192929-255tbps-worlds-fastest-network-could-carry-all-the-internet-traffic-single-fiber

I'm afraid the growth of bitcoin users will be much slower after majority of IT aware people are on board, and that will happen as early as next year: It takes decades to get one generation of people that is enough IT literate

So pls place a BIP quick, than it might be in the code - in time!

 

[Lauda]

Now the bandwidth record is 255Tbps, to handling that kind of traffic..

Which is a completely useless piece of information with the current world average being ~5Mbps (grew less than 15% year-on-year).

Why does bitcoin have to compete with visa, how ever said it was designed for such a purpose?  Is it not greater than just a payment system?

Bitcoin has currently a limited transaction capacity. It can not become mainstream without being able to handle more transactions. Visa is just used for comparison.

[Daffadile]

Well, the article has some false information. It says that the network is currently able to process 7 TPS, and would be able to process 27 TPS with a 4 MB block size limit. This is false. Realistically we are looking at a TPS of around 3 right now, so with a 4 MB block size limit we would look at ~12 TPS. I'm actually wondering how people aren't aware of this and don't understand that Bitcoin can never come close to Visa (if we focus on scaling via the block size limit).

Let's say that 700 million people use Bitcoin (that's ~10% of the World population), and that they all make only 1 transaction per day. Transaction size is averaging half a kilobyte today (source Bitcoin Wiki).
700 million transactions * 0.5 = 350 million Kilobyte = ~350 GB/ 144 (blocks per day) = ~2.4 Gigabyte per block. This is only if they make a single transaction per day (which is unlikely, as the average would be much higher with adoption on this scale).

Even with the 7 TPS for 1MB block, there is not much improvement for the 2MB block. For the speed to be really high, we need centralised processor.

[hv_]

Just found that, but have no clue (sorry). Anybody know about?

http://bitcoinist.net/bigchaindb-the-scalable-blockchain-database-for-securing-diamonds-and-more/

And another one (Rootstock) comes up with scaling concepts:

https://medium.com/@CryptoIQ.ca/rootstock-smart-contracts-on-the-bitcoin-blockchain-e52b065421a8#.npkfpas4w

[franky1]

Well, the article has some false information. It says that the network is currently able to process 7 TPS, and would be able to process 27 TPS with a 4 MB block size limit. This is false. Realistically we are looking at a TPS of around 3 right now, so with a 4 MB block size limit we would look at ~12 TPS. I'm actually wondering how people aren't aware of this and don't understand that Bitcoin can never come close to Visa (if we focus on scaling via the block size limit).

Let's say that 700 million people use Bitcoin (that's ~10% of the World population), and that they all make only 1 transaction per day. Transaction size is averaging half a kilobyte today (source Bitcoin Wiki).
700 million transactions * 0.5 = 350 million Kilobyte = ~350 GB/ 144 (blocks per day) = ~2.4 Gigabyte per block. This is only if they make a single transaction per day (which is unlikely, as the average would be much higher with adoption on this scale).

Even with the 7 TPS for 1MB block, there is not much improvement for the 2MB block. For the speed to be really high, we need centralised processor.

the only correct thing that lauda said is that bitcoins 1mb is 3.3tx/s max.. (as the average is 2000 transactions per 600 second block)

but the failure of many people is that they think visa is just one network/one ledger..
so lets take these 2 websites.
http://www.statista.com/statistics/279275/average-credit-card-transaction-volume-per-card-worldwide/
in 2012 the average number of transactions per visa card holder was 40 transactions a year
this is due to some users only using it 2 times a year or once a month and some users using it daily.
now if we apply that average to the 104million US visa card holders, then that is an average of 4.160billion transactions a year
http://budgeting.thenest.com/percentage-americans-credit-cards-30856.html

which if we take 2mb+segwit (8000tx per ten minutes) is 420million transactions a year.

so bitcoin with 2mb+segwit can handle 10% of visa americas ledger.

meaning if bitcoin blocks were 20mb in lets say 10-15 years. bitcoin can easily handle 4.2billion transactions and it wont take 60 years, like visa took. it would take only 10-15 years for bitcoin (based on technology growth)

so one ledger of visa can handle 10x more then one cryptocurrency ledger

as for other countries. well they are separate visa ledgers, so you might as well compare Visa UK to blockchain sidechain A and visa Europe to blockchain side chain B, etc, etc.

then you would have a fairer comparison of network ledger settlement vs network ledger settlement

in short
try not to think of combining visa's MULTIPLE ledgers when comparing it to bitcoins single ledger. as thats just a fools attempt of trying to coax people away from bitcoin to a pump'n'dump alt like ether, monero, etc.
think about bitcoin not for todays abilities compared to visa worldwide. but based on bitcoins 15 year growth potential where XXmb+segwit+sidechains would the comparable of visa 60year old network

remember bitcoin has 2million users. visa has 100million(us) 800million(world) users. so bitcoin does not need to surpass visa today, but does have the potential over the next 15 years.

[Kprawn]

Well, the article has some false information. It says that the network is currently able to process 7 TPS, and would be able to process 27 TPS with a 4 MB block size limit. This is false. Realistically we are looking at a TPS of around 3 right now, so with a 4 MB block size limit we would look at ~12 TPS. I'm actually wondering how people aren't aware of this and don't understand that Bitcoin can never come close to Visa (if we focus on scaling via the block size limit).

Let's say that 700 million people use Bitcoin (that's ~10% of the World population), and that they all make only 1 transaction per day. Transaction size is averaging half a kilobyte today (source Bitcoin Wiki).
700 million transactions * 0.5 = 350 million Kilobyte = ~350 GB/ 144 (blocks per day) = ~2.4 Gigabyte per block. This is only if they make a single transaction per day (which is unlikely, as the average would be much higher with adoption on this scale).

Even with the 7 TPS for 1MB block, there is not much improvement for the 2MB block. For the speed to be really high, we need centralised processor.

the only correct thing that lauda said is that bitcoins 1mb is 3.3tx/s max.. (as the average is 2000 transactions per 600 second block)

but the failure of many people is that they think visa is just one network/one ledger..
so lets take these 2 websites.
http://www.statista.com/statistics/279275/average-credit-card-transaction-volume-per-card-worldwide/
in 2012 the average number of transactions per visa card holder was 40 transactions a year
this is due to some users only using it 2 times a year or once a month and some users using it daily.
now if we apply that average to the 104million US visa card holders, then that is an average of 4.160billion transactions a year
http://budgeting.thenest.com/percentage-americans-credit-cards-30856.html

which if we take 2mb+segwit (8000tx per ten minutes) is 420million transactions a year.

so bitcoin with 2mb+segwit can handle 10% of visa americas ledger.

meaning if bitcoin blocks were 20mb in lets say 10-15 years. bitcoin can easily handle 4.2billion transactions and it wont take 60 years, like visa took. it would take only 10-15 years for bitcoin (based on technology growth)

so one ledger of visa can handle 10x more then one cryptocurrency ledger

as for other countries. well they are separate visa ledgers, so you might as well compare Visa UK to blockchain sidechain A and visa Europe to blockchain side chain B, etc, etc.

then you would have a fairer comparison of network ledger settlement vs network ledger settlement

in short
try not to think of combining visa's MULTIPLE ledgers when comparing it to bitcoins single ledger. as thats just a fools attempt of trying to coax people away from bitcoin to a pump'n'dump alt like ether, monero, etc.
think about bitcoin not for todays abilities compared to visa worldwide. but based on bitcoins 15 year growth potential where XXmb+segwit+sidechains would the comparable of visa 60year old network

remember bitcoin has 2million users. visa has 100million(us) 800million(world) users. so bitcoin does not need to surpass visa today, but does have the potential over the next 15 years.

Not all transactions have to be on-chain too... Did anyone consider that off-chain tx's from services like Xapo needs to be added to the transaction totals to reflect the real tx's that are currently done?

Yes, it might not reflect the true tx/second ability of the Blockchain, but off-chain services reduce the load, but still needs to be counted. After all, value has moved between people and only a few

main tx's on-chain was needed to validate it's movement. SegWit and the LN will soon complement these tx's.    

[Amph]

Well, the article has some false information. It says that the network is currently able to process 7 TPS, and would be able to process 27 TPS with a 4 MB block size limit. This is false. Realistically we are looking at a TPS of around 3 right now, so with a 4 MB block size limit we would look at ~12 TPS. I'm actually wondering how people aren't aware of this and don't understand that Bitcoin can never come close to Visa (if we focus on scaling via the block size limit).

Let's say that 700 million people use Bitcoin (that's ~10% of the World population), and that they all make only 1 transaction per day. Transaction size is averaging half a kilobyte today (source Bitcoin Wiki).
700 million transactions * 0.5 = 350 million Kilobyte = ~350 GB/ 144 (blocks per day) = ~2.4 Gigabyte per block. This is only if they make a single transaction per day (which is unlikely, as the average would be much higher with adoption on this scale).

Even with the 7 TPS for 1MB block, there is not much improvement for the 2MB block. For the speed to be really high, we need centralised processor.

no we need some kjind of optimization to the protocol and cpu, the usual link to debunk this argument about bitcoin not able to reach visa transaction

https://en.bitcoin.it/wiki/Scalability