Long Term Security: BTC vs. BCH

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Avatar for Bitcoin_Citadel
3 years ago

A problem that I've been thinking about a lot recently is the fact that one day soon the BTC security budget will be mostly comprised of transaction fees and with the 1mb hard cap, not that many people will be making transaction fees per time. This is a serious security risk as it will threaten the hash rate substantially.

I've done some thought experiments to try and solve how BTC will mitigate the risks and one option that seems *the most* plausible (not necessarily practical), is that, in a world where BTC reigns supreme as a standard currency, people will voluntarily run mining rigs. Businesses can have a mini mining farm that doesn't consume a sufficiently large amount of electricity to burden them, and if enough businesses do this, then the network *may* be secure. Though this is a potential solution, I don't think it's a good one, and I don't think that we can rely on the charity of others to ensure the trustlessness of the protocol. This is truly a bad situation for BTC and the 1mb hard cap is not a sustainable way to fund the security budget.

So rather than people voluntarily have mining operations where they run at a loss, imagine this situation but with BCH where the large blocks allow for sufficient transaction fees to cover security budget and allow miners to maintain a high cumulative hash rate. This situation comes with its own problems: primarily that the size of the BCH blockchain will be large. But what is easier and cheaper: having businesses voluntarily run BTC mining farms or having them voluntarily run mini datacenters where they can maintain the BCH blockchain? If every fortune 500 company ran a full BCH node, it would minimally impact their balance sheet, and already there would be 500 bch full nodes. Running a full node wouldn't be something so extravagant that only fortune 500 companies would be able to fund them, any business, really, with a somewhat decent cash flow would be able to afford better than average hard drive space and better than average bandwidth.

I'm not suggesting that individuals wouldn't be able to run full nodes, but consider the worst case scenario, if they couldn't it still wouldn't be the end of the world as there would still be plenty of opportunity for full nodes to be ran and plenty of instances of the preservation of the BCH blockchain.

There is always a trade off when considering scalability and decentralization, but the cost of scalability for the decentralization BTC offers is not a good trade, whereas in the case of BCH, the decentralization may not be perfect (in the sense of every single person running a full node) but it is a far better to employ the strategy listed above where the world creates a tremendous amount of mini data centers to preserve the BCH chain.

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3 years ago

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