Why Bitcoin Cash And Also Why It Must Change For Success

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1 year ago

Up front, this article is mostly about facts and truths with a little bit of theorizing.

We'll start with Bitcoin Core (BTC). It is clearly the slowest, and most expensive coin actually being used today. The only people who recommend or say good things about it are those who are heavily invested, or who have no idea about how cryptocurrency works. It's a fact that you won't find anyone who knows about cryptocurrency saying good things about BTC unless they're invested in it.

Although its price may very well continue to go up in the short term, everything about the way it currently works guarantees failure with mass adoption. This is because it doesn't even have remotely close to mass adoption currently, yet at its all time high, most transactions were either dropped or took a very long time to complete (many hours and even days). Then you look at the price of a transaction, which make it completely unusable for mass adoption because no one in their right mind will go to a grocery store or a movie theater and pay a ~$20 fee in transactions. Finally you look at the power consumption of it for a tri-facta of imminent failure. The problem here is that you won't hear any of the big players talking about it because they stand to lose a lot of money if that knowledge becomes main stream. Instead, they're counting on either Lightning taking hold or changes to the code in the future that will make it work as originally intended. Both options do have a high chance of either failure or success.

Power consumption is an issue everyone on the Earth is dealing with and both governments and companies are starting to make active strides in reducing their footprints. All the pro BTC investors were up in arms once Elon Musk tweeted that BTC's power usage was an issue. Their primary counter to his tweet is that BTC uses less fossil fuels than the banking industry. Their secondary counter is that a lot of mining farms are utilizing alternative energy. The issue here is that comparing apples to oranges is a foolish counter. An example of this is folks said the banking industry uses a lot more energy than BTC does currently. From any point of view, the banking industry is also a lot larger than BTC so yeah... duh? Also when comparing the two, the banking industry is similar to a wood burning train and BTC is similar to a coal burning train. Both of which are stupid and shouldn't exist in today's world. Seriously, how can anyone creating new technology today look another person in the eye and say, "Even though I could've made it use less energy, it's okay because my technology uses less than my competition". Especially when other people in the exact same crypto space can say, "I have done everything I can to minimize power consumption, but I will also continue to work on making it better as time passes."

When it comes to upgrading the BTC code itself, prior to this past month or so most people honestly believed it could never happen and that too many folks with invested interest in Lightning would prevent said changes. However, Taproot may be the proof needed that changes can happen. I still believe to my core though that many companies and investors stand to lose too much money if Lightning goes away, so they will spends millions of dollars and thousands of man-power effort preventing BTC from changing for the better.

When it comes to Lightning, you may have heard a lot of good or bad about it thus far and I'm not here to swing your opinion on it either way, even though I do have some opinions of my own. Lightning is fast, it is cheap, and it does create more job possibilities. However, it also has a lot of problems currently, it requires you to trust a third party with your money, is not actually on the BTC blockchain, and will require you to give up the same Personally Identifiable Information (PII) that banks require. Arguments against it mainly point towards the whole reason crypto was created in the first place is so you don't have to place your trust blindly, instead you can verify and ensure your money is safe. In truth though, I honestly cannot think of any arguments for using Lightning other than the fact that BTC is broken and doesn't work. This is why I'm a supporter of Bitcoin Cash. Although BTC has the "possibility" of fixing their problems, the real question you should be asking yourself is, "Why would I take that chance and wait for them to change when BCH already exists and has resolved BTC's problems?"


So here we are now, finally talking about Bitcoin Cash (BCH) as the title suggests... Firstly, BCH can already scale for mass use and will continue to be fast and cheap. While using BCH, you have a lot of different capabilities such as privacy, sub tokens, scaling, instant transactions, etc. Although I am a fan of BCH, this posting isn't to discuss all the good things about it. Instead, I'm going to discuss why BCH must change in the near future or face imminent failure. In the short term, 10 years or so, BCH is on track to be extremely successful and take over the market from BTC. In the long term though, PoW cannot work in its current form and it must be changed.

I've read on many occasions about how BCH uses 90%+ less energy than BTC does and while that may be factually true, it is only partially true. The people heavily invested in BCH aren't willing to tell you full truth. The truth is that while BCH does use less energy and has the capability with mass adoption to use 90%+ less than BTC needs, there is a darker side to the story. The dark side is that although BCH may not "need" to use as much, if it became the number one coin, the majority of miners would switch over to BCH. This is because the mad rush on mining BCH would occur and all that energy currently used on BTC would switch to BCH, even though its not needed. Unfortunately, the way BCH's Proof of Work (PoW) currently works would incentivize people to burn energy needlessly so they can make money.

What I just mentioned should be a 100% clear indicator that BCH needs to change or face an extinction level event. The question is how and what kind of change is needed. This is where a lot of intelligent individuals will point out one of the many varieties of Proof of Stake (PoS). There are of course upsides and downsides to PoS, but my primary concern is the possibility of a bad actor purposely making the network centralized. This sounds silly to a lot of pro-PoS individuals and they say this cannot happen, however in simple terms, the way PoS works is by staking your coins on a main node that does the voting for you. In return, you obtain more coins similar to earning interest on your savings account. The problem here lies in the fact that if an intentionally bad actor decided to give a payout much higher than every other main node, everyone in their right mind would switch their staked coins to said node. Some folks have made proposals to help prevent this from happening such as the larger the node, the less the payout, etc. An issue here is that solution only prevents nodes from having control unintentionally. If a main node has the intention of doing harm, they will knowingly lose money and purposely pay out more to get more staked coins. Another proposed solution is to prevent any one node from having more than x% of power. This might work in theory, but the x% would need to be extremely small because even at a cap of 1%, a wealthy competitor can easily create 51 nodes with huge payouts in order to have the majority vote. So we're now talking about needing something along the lines of a .00001% control cap per node just to prevent a hostile takeover. While that option would be ideal, it'd be almost impossible to ever hit that number without complete world-wide adoption.

So where do we go from here? The answer is that I am unsure. What I am certain about though is that the BCH community are some of the smartest and brightest minds out there. BCH and its supporters have shown the understanding and desire to adapt to changes. The community as a whole needs to start having these hard discussions sooner than later though. Change is inevitable and BCH must change to be successful.

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1 year ago