Bitcoin: What Has Been Insufficient To Become A Major Currency?
For the past few months, the Bitcoin community has been debating regarding the purpose of the Bitcoin network. Isn’t its main purpose is to serve its global network of users as a settlement network? Or must it perform as a digital gold for the investors using it as a safe haven asset to progress great sums of money? And the Bitcoin is the finest to describe as a peer-to-peer (P2P) digital currency. The Bitcoin creator Satoshi Nakamoto described the Bitcoin network in its official white paper as an electronic cash system designed to manage and payment from one party to another without the presence of a mediator or the financial institution.
The Memopool – The processing of the transactions within a peer-to-peer network with an absolute absence of mediators, the network administrators and the third-party participants is way too hard, expensive and also technologically challenging which is the reason why the Bitcoin requires an open-source community of developers to keep the codebase. The Bitcoin is still in its early stage of development as well as its adoption. The anonymity is yet to be introduced right into the Bitcoin users and the scalability is an urgent dilemma that is still to be dealt together with the Bitcoin developers within the open source community. Currently, the Bitcoin operates as the digital gold. And the average transaction cost of fees is worth of $0.32 per transaction and the network entails at the very least of an hour for a transaction to be verified. And as of late, the traditional system of transaction approval based on the total summation of six confirmations from the miners has been being delayed due to the Bitcoin network’s limited block size and also the growing memopool of transactions.
The Need For Consensus – For the Bitcoin to become a major currency like any other technologies, it requires to grow and past this certain development stage where the scalability, flexibility and the anonymity issues are already been addressed. And as being mentioned before, the complexity of the Bitcoin network necessitates the Bitcoin developers to set out a plan of a cautious approach towards the scaling network, as a reckless solution could either split the Bitcoin network into two or else lead to severe security concerns that may be thorny to deal with in the near and approaching future. At the time that the cash was first introduced in the United States of America, it was dowelled to the value of gold. And the initial commodity which was used as the foundation of the entire monetary system of the United States of America was gold; and based on that particular commodity, the cash system was deployed for the convenience.
The Two Layers – The first layer of the Bitcoin network can be noticed as what the gold was to the American cash system. It provides endows with an infrastructure right for a settlement network to be deployed for the users to be able to suitably and resourcefully process transactions. The processing of the transactions on the first layer of the Bitcoin can be hard enough and costly. On the other hand, as the first layer starts to scale and the two-layer solutions like the Lightning are being introduced, cheaper payments will be enabled and the microtransactions will be also introduced right into the Bitcoin network. A well-known Bitcoin investor like Roger Ver keeps on emphasizing that if the Bitcoin’s usefulness as cash is undermined its worth will be undermined, and thus the community and the industry must not consider the Bitcoin as the digital gold but only a settlement system.
In the reality is the Bitcoin network as of the current resembles the structure of the digital gold. However, as the technology which may have to underpin the Bitcoin’s advances and evolves to it; it will be utilized as both of a settlement network and also as a digital gold.Read more: https://www.xmlgold.eu/en/news/article/578/bitcoin-what-has-been-insufficient-to-become-a-major-currency/www.xmlgold.euXMLGold is an e-currency & digital currency exchange company. With XMLGold.eu, you will always be able to instantly exchange the following:
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