Eric Lombrozo, a Bitcoin Core developer, believes that bitcoin is about financial independence and freedom, rather than providing a centralized settlement network which already serves as the backbone of today’s global financial ecosystem.
Over the past two years, various bitcoin communities, analysts and experts have debated on the characterization of bitcoin; specifically whether bitcoin demonstrates the qualities of a settlement network or digital gold.
Since the initial deployment of the bitcoin network, Bitcoin Core developers and other talents in the open source development community of bitcoin have focused on strengthening security measures to eliminate the presence of a central authority within the bitcoin network and ensure the network itself will not be compromised in the future.
The prioritization of security instead of flexibility and functionality as seen in alternative failed blockchain projects allowed bitcoin to prosper and evolve into a decentralized financial network that can’t be censored or restricted by a governing entity. It allowed users to settle payments with low fees and at relatively fast speeds, in comparison to traditional banking.
As the bitcoin network grew in size, transactional delays caused discomfort for daily users. Some individuals expressed their concerns over the increasing transaction fee of bitcoin, which is currently at US$0.32 for an average transaction. A $0.32 fee should be enough to have transactions confirmed within a few hours.
However, the Bitcoin Core development team and industry leading companies aren’t particularly concerned of the rising fees as it is the result of the prioritization of security. Bitcoin Core developers are focused on introducing software like Segregated Witness (Segwit), which allows bitcoin to scale significantly without imposing major security risks unlike hard forks.
Users and investors shouldn’t necessarily be overly concerned about the scalability of bitcoin as well because there already exists a scalability and transaction malleability solution in Segwit and two-layer solutions such as Lightning and TumbleBit that can contribute to the scalability of bitcoin. Lightning in particular enables the facilitation of micropayments, that open doors for many applications which intend to rely on bitcoin micropayments.
Bitcoin is still a technology at an early stage. Currently, the Bitcoin network allows users to make payments that weren’t possible before. Before bitcoin, users couldn’t imagine the possibility of transacting millions of dollars within a few hours with less than $1 in transaction fee without the presence and involvement of a governing entity or a bank.
As Lombrozo explains, “Bitcoin is about financial sovereignty. If you think it’s merely about fast and cheap you’re short-changing yourself.”
The contemporary structure of bitcoin makes it difficult for two-layer solutions to exist. Soft forks like Segwit however allows bitcoin to eliminate transaction malleability and alter its design to welcome two-layer solutions that could enable bitcoin to become a fast, cheap and secure financial network for mainstream users.
Lombrozo believes that the activation of Segwit, implementation of layers and introduction of innovative solutions will allow bitcoin to serve as an important technology to provide users with financial freedom, privacy, independence and flexibility.
“You can make it fast and cheap with layers. Current network design does not allow it at large scale. I wish this weren’t so. Unfortunately HFs carry significant political cost and security risks. I also wish this weren’t so,” noted Lombrozo.
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