This article covers part two of the video series by Isaac Morehouse called “Tiny payments are a big deal.” You can watch the video or read the summary below. If you haven’t watched part one, it’s advisable to do that first.
What’s left of the Bitcoin dream?
Isaac opens by referring back to an article he wrote on Bitpost called ‘What’s left of the Bitcoin dream?’
In it, he outlined the original promise of Bitcoin and discussed what’s left of it. He listed some of Bitcoin’s initial promises, including its sound-money properties, its global nature, being outside of government control, its immutable records, the potential to replace government money, and much more. These days, he believes that many of those qualities were oversold.
Why does he think they were oversold? That’s what the first part of this video covers.
Isaac notes that when users buy and send BTC on applications like CashApp, what they’re actually sending is Bitcoin IOUs. That’s because of the high fees on the BTC network, and these payments firms want to treat BTC as some reserve asset rather than peer-to-peer electronic cash.
Isaac also mentioned several other potential problems, including Tether, which is shady, to say the least, and the vast proliferation of altcoins which diminish Bitcoin’s value-holding proposition. He even sees a straight-up code change as being likely because of BTC’s insistence on keeping blocks small.
As for being outside of government control, Isaac notes that there are many ways governments can control digital currencies, including outright violence if necessary. They can control developers and regulate digital currencies to their liking.
Regarding privacy, Isaac mentions that public ledgers are not totally private or encrypted. Everything is visible and traceable by determined parties. Greater privacy is possible by splitting transactions into many small ones, but that requires low fees, and those BTC fees are several dollars per transaction these days.
As for instant transactions, he notes that Bitcoin was originally instant. It also is in its restored form today. BSV transactions settle almost instantly and are incredibly fast.
What about being global? It could technically be so, but a combination of government regulations or bans in some countries and BTC’s high fees stifle the true potential for Bitcoin to be a global currency.
When it comes to decentralization, Issac says that’s “sort of” true. He notes that even if Bitpost banned his account tomorrow, his stuff would still be on-chain, and he could access it. However, he notes that miner pruning could be a problem unless secondary data warehousing services emerge. Isaac explains that the potential for pruning is always there, so it’s not fully decentralized in the way that word is often understood.
BTC is also not usable as money. It’s morphed into some sort of ‘investment asset’ or digital gold. The slow transactions times, high fees, and volatility of the coin make it unsuitable for most transactions.
So, given that all of these attributes were oversold, what’s left of the Bitcoin dream? What’s possible today without any theoretical fixes or required future problem-solving? Tiny payments, of course.
How tiny payments can change the world
Isaac believes that one of the things that weren’t oversold about Bitcoin and which is a legit innovation is tiny payments.
Answering one of the most common criticisms first, Issac mentions how many people object that they don’t want to pay per page or per minute or streaming. Yet, he says that it won’t necessarily work that way for the consumer. People can still have their $9.99 a month Netflix subscription, but artists on the back end can be paid instantly and get their cut without waiting weeks or months for royalty checks.
Issac also believes that micropayments can add great value to the struggle for human liberty and freedom, something dear to his heart. For example, they can change the way money is made and split. While right now, many artists are simply hired and paid a flat fee for their work, because of micropayments, they could earn recurring revenue for life via smart contracts. This could give many creators real ownership of their work.
“The reason that firms exist is that transaction costs are high,” Isaac explains. Finding people for each job is simply too high, so firms hire people they know they’re going to need in the future on a salary. Micropayments can transform how this relationship works and transform the very idea of what a firm is. Fundamentally, Isaac believes this is empowering for creators and will give them choices about how they’ll work. Some people may still choose to be salaried employees, but others will be able to make recurring payments from their creations for life.
Because of all of this, Isaac is trying to avoid the protocol wars and debating about what chains are best. He’s open to all options that can get the job done. He mentioned he’s interested in talking to people from different blockchain projects in this series.
It’s going to be fun to learn more about how tiny payments can change things and what other chains might be capable of when compared to BSV. We’ll be reporting on each installment of Isaac’s series, so keep an eye on CoinGeek for those updates!
Watch: CoinGeek New Yor presentation, Micropayments for the World: APIs, Tokens and Computation
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