I am happy to announce I have begun publishing my detailed comparison between the Internet Computer Bitcoin solution, and the Lightning Network.
The first article in the series is written, it’s an introduction and background on the success of Bitcoin and the need for Lightning and ckBTC.
I expect at least two more articles to come. The next one will deal with architecture, network design and cryptography. The advantages and limitations of both solutions to make Bitcoin payments fast, and with low fees.
I would particularly value the feedback from DFINITY Researchers and Developers here to make sure the information is accurate. I find that few people understand or even know what Chain Key Cryptography is, or how the architecture of the IC Network works securely.
I enjoyed the first part of your article and look forward to future posts.
I would like to interject into the first part of your article in reference to point 3
“To encourage freedom and privacy in the financial world by removing the connection between the person, and his money. Unlike bank accounts or credit cards, Bitcoin has some level of anonymity.”
I would now like you to consider that BTC has already been taken over and is being controlled by JPMorgan Chase and by all the investment houses that have invested into BTC along with the Billions of dollars or BTC that were stolen and not yet returned to the owners.
Wall Street On Parade
It’s like Musk thinking he could beat the vehicle industry that has had 130 years of vehicle building by stealing the idea of an electric car and taking them on.
Bye Bye Tesla
The stock market, banking and fiat currency have been around for centuries. I don’t think it will be easy to overtake and defeat those industries.
At this time, my main concern is that I have BTC with BNB but cannot access it because I haven’t submitted my personal details for their collection, which I do not want to provide. As a result, Binance will not release my funds.
They want my last 3 months bank statements.
I believe that BTC may be decentralized but the processes it passes through have already centralized BTC.
Nice article!
Overall, I think the article is well written and easy to understand.
I spotted a few issues that you may want to fix:
the amount of transactions that the Bitcoin network can process per minute is about 6 per minute
It is actually about 3-7 transactions per second on average.
the network requires 6 confirmations for a transaction to fully clear
There is no clearance in Bitcoin, so this statement is a bit misleading. Moreover, it is always up to the user to decide how many confirmations is “enough”. For example, Coinbase considers a transaction with (at least) 2 confirmations final.
operating in 2018, .it is
Something is wrong with the punctuation here.
if the user wants to exchange it for real Bitcoin he can easily do it by exchanging it for BTC
This statement is redundant. Please consider rephrasing this part!
Bitcoin has some major investment from large fund managers, especially via the US ETFs like Blackrock. This is true, but they do not yet have control. You can verify this by exploring the data on who holds how much Bitcoin, and who runs the miners. That said, Big Finance is coming, and it may become compromised and taken over by them. So far this has not happened.
Perhaps is time for a new Bitcoin alternative to rise… but who will build it? It’s not an easy project to undertake.
Regarding Binance and KYC, remember Binance was sued in many countries, because of that the head of Compliance at Binance is now the CEO. So the reason they ask you so much is not Binance’s fault is the country that demands this from them. They can’t fight it, or they get sued to the point of being destroyed.
Whenever possible get Bitcoin through a direct relationship without KYC, there are some markets that provide this. Research if you have this in your country.
Even though I knew about the TPS speed range it seems I made a mistake typing minutes instead of seconds.
The clearance is not misleading, until you do have six confirmations you are not 100% sure the transaction is done. Most wallets show you the confirmations, and some exchanges and wallets won’t let you use the BTC until the confirmations are done.
I also have tried my best to re-write the ckBTC to Bitcoin transfer, this is the new text:
On April 3, 2023, the Internet Computer released a powerful new feature called Chain key Bitcoin or ckBTC. ckBTC securely tokenizes Bitcoin inside the Internet Computer, and simultaneously make it extremely fast, and able to support cash-like transactions securely.
ckBTC is backed one-to-one with real Bitcoin. It can be used securely for a variety of use cases like buying a coffee, giving a tip, buying a book or sending it to a person all in under two seconds.
After a while if the user wants to exchange his ckBTC for Bitcoin he can easily do it with the Internet Computer Wallet, sending himself the amount of BTC he wants to his favorite Bitcoin wallet.
ckBTC is in many ways a better alternative to Lightning, and in the coming series of articles I intend to show you why.
It’s near impossible to revert after 6 confirmations, but googling around I found a way, the person who did the transaction, meaning the person who has the private key can cancel it by paying a larger fee, and voiding his own previous transaction:
Curious if there is any other way… could not find any that is not very unusual, or near impossible to do.
By the way by the end of this week I intend to publish Part 2, a very important one focusing on the weaknesses of Lightning. It has some serious issues most people are not aware of.
Just to make sure there is no misunderstanding here, it is only possible for a user to “revert” a transaction if it has not been confirmed yet, i.e., when it has zero confirmations (as it says in the overview, “by increasing the transaction fees rate of the new transaction to make it confirmed first”).
Moreover, there is no guarantee that the “reversal” will work because the miners are free to include either transaction in a block.
While a casual user cannot undo confirmed transactions, it is still possible that a fork occurs causing a chain reorganization, which invalidates all transactions in orphaned blocks.
Nowadays, we rarely even see two blocks at the same height. However, there is no guarantee that a reorganization won’t happen. If it happens, the most likely cause is a botched software update causing forks in the Bitcoin network.