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Frederik Nielsen has 212 articles published.

Frederik Nielsen
I’m a freelance writer and full-time curious person. My main interests are philosophy, politics, art, culture, science, and how they’re all interlinked. When I’m not writing, I’m fronting a band, producing records, and making videos. I’m also currently working on launching a YouTube channel that will focus on culture and politics. I think blockchain technology is fascinating because of the huge potential it has to revolutionise not only the financial sector, but society as a whole.

Bitcoin Law: What Are The Rules?

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Is there a Bitcoin law? The answer is both yes and no. However, it depends upon where you are and what you use it for. The dispute surrounding the legality of Bitcoin and cryptocurrencies is widely debated. More legislators discuss it now, because of the spread of digital currencies.

What does the law say?

Usually, people are permitted to trade with the legal tender in their country, but not produce the cash themselves. Bitcoin, with its miners and verification system, presents a problem for legislators. Since Bitcoin is a currency separate from the national money, Bitcoin mining is technically not counterfeiting. Bitcoin isn’t counterfeit, as it’s not attempting to pass off as another currency. But lack of proper policy still makes Bitcoin somewhat of a grey area.

Why Bitcoin law is difficult

Trying to fit Bitcoin into a package of currency legislation has not always succeeded. Bitcoin is still relatively new, and the law-makers are bound to progress with the law. We do know a few of the rules and regulations, however. We’ll add them to this post as well find out more about the provisions.

bitcoin law

Is Bitcoin prohibited?

Whether or not Bitcoin is legal depends on what it is being used for. Investing your Bitcoins in everyday goods and services is perfectly legal in the United States, for example.

Is mining Bitcoin legal?

It’s legal to own and run a Bitcoin mining rig in the majority of locations. Nevertheless, think about if it’s financially viable where you live. Individual nations have laws that may limit your ability to trade. You might need to examine what you can do with the yields on exchanges for fiat loan. Bitcoin mining might be an issue if you’re sharing your energy costs with other people. If they aren’t conscious of your mining activities, then they might be amazed when the expenses show up.

Is Bitcoin taxable?

The IRS in the United States sees Bitcoin and other tokens as taxable personal or commercial property like bonds and stocks. The laws differ from country to country.

bitcoin law

Nations where Bitcoin is prohibited

Algeria, Bangladesh, Bolivia, Cambodia, China, Colombia, Ecuador, Egypt, Indonesia, Iran, Morocco, Nepal, Pakistan, Saudi Arabia, and Taiwan.

Nations where Bitcoin is legal

Argentina, Australia, Austria, Belarus, Belgium, Bosnia and Herzegovina, Brazil, Bulgaria, Chile, Costa Rica, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France ,Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Jamaica, Japan, Kyrgyzstan, Lebanon, Lithuania, Luxembourg, Macedonia, Malaysia, Malta, Mexico, Namibia, Netherlands, New Zealand, Nicaragua, Nigeria, Norway, Philippines, Poland, Portugal, Romania, Russia, Singapore, Slovakia, Slovenia, South Africa, South Korea, Spain, Sweden, Switzerland, Trinidad and, Tobago, Turkey, Ukraine, United Kingdom, United States of America, Uzbekistan, Venezuela, and Zimbabwe

Countries where Bitcoin is limited

Canada, India, Jordan, Thailand, United Arab Emirates, and Vietnam.

How To Sell Your Bitcoin

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sell bitcoin

How do you sell Bitcoin? You can sell Bitcoins in all the very same places as you can buy Bitcoins. The primary methods which people buy and offer cryptocurrencies are:

sell bitcoin

Trading on exchanges

There are around 500 cryptocurrency exchanges open for trade all over the world. You can open an account and begin trading in a matter of minutes. Follow these steps to sell Bitcoin on cryptocurrency exchanges.

Step 1. Create a Bitcoin exchange account

You will initially have to provide your e-mail address and set a password. Once you’ve validated your e-mail, you will be able to establish two-factor authentication. The majority of exchanges will ask you to confirm your identity. How much documentation you need to offer depends upon the rules of the exchange and the laws of your nation. You will frequently be asked to supply a government-issued ID and a proof of address. Once your account is developed, you will immediately be offered a Bitcoin wallet

Step 2. Send Bitcoin to your exchange wallet.

The next step is to send the preferred quantity of Bitcoins from your wallet to your exchange wallet. The transfer can take anywhere from a minute to some hours if the exchange is hectic.

Step 3. Place a sell order on the exchange

Once your Bitcoins have shown up, it’s time to offer them. You can offer Bitcoins instantly if you’re happy with the existing market rates. You also have the option to put a limit order, which only sells once it’s reached a specific price.

Step 4. Withdraw your funds

You can withdraw the funds once you’ve successfully sold your Bitcoins. There are numerous methods you can withdraw cash depending on the exchange. Some exchanges only enable bank transfers, while others would allow transfers to other platforms like PayPal.

sell bitcoin

Sell Bitcoin via P2P Bitcoin exchanges

Peer-to-peer (P2P) trading is another favorite technique to sell Bitcoins. Rather than relying on exchanges to sell your Bitcoins, you can eliminate the middleman. P2P trading allows you to sell Bitcoins and receive payments in bank transfers, PayPal transfers, or cash.

Sell Bitcoin to Bitcoin ATMs

Bitcoin ATMs are successfully stationary cryptocurrency exchanges. In other words, you can purchase and sell Bitcoin anonymously.

Sell Bitcoin with crypto debit cards

Quite a couple of business have formed partnerships with Visa and Mastercard to release Bitcoin debit cards. These cards are generally preloaded Visa/Mastercards you can spend in-store or at regular ATMs. The majority of Bitcoin debit cards come with an app that quickly allows you to sell your Bitcoin for cash, which you can then invest with the card.

Sell Bitcoin face-to-face

As with anything else, you’re able to trade Bitcoins face-to-face. Meet up with an interested buyer, scan a QR code on their phone, and receive cash. It has to be stated that you should always take precautions when meeting strangers in public. Stay safe, and utilize a direct Bitcoin trading mediator if you do not feel 100% safe.

5 Ways To Buy Bitcoin

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buy bitcoin

How do you buy Bitcoin? You need to get a Bitcoin wallet, for starters. Do not worry if you do not have one yet. Many platforms include a wallet when you develop an account on them. There are several ways you can get a Bitcoin wallet:

buy bitcoin

You can purchase Bitcoin immediately

There are many methods you can buy Bitcoin in the blink of an eye. These consist of:

How to buy Bitcoins with credit card

You can buy Bitcoins with a credit card using one of the many cryptocurrency exchanges. A few of the most public exchanges are:

However, there are also some Bitcoin debit card companies that let you buy Bitcoin with a card. TenX, CryptoPay, and Wirex are among them:

Lastly, you can head over to Bitcoin.com and buy Bitcoin Core (BTC) and Bitcoin Cash (BCH) from their site:

Buy Bitcoin using PayPal

PayPal has been open-minded when it pertains to Bitcoin and has not enforced any regulations on it. Some sites, brokers, and exchanges permit you to purchase Bitcoin with PayPal. Take a look at a few of them here:

buy bitcoin

How to buy Bitcoins with cash

It’s still possible to buy Bitcoin with cash and anonymously. It is always more risky to buy anything with fiat money. You might choose this technique for personal privacy purposes. Luckily, there are some methods you can trade cash for some Bitcoin. Peer-to-peer exchanges permit you to buy directly from other Bitcoin users. A few of the most popular P2P exchanges are:

Bitcoin ATMs

Another way to buy Bitcoin with cash is to use Bitcoin ATMs. These will be stationed around cities. There will likely be a lot of ATMs if you’re in a huge city like New York or London. Suburban and countryside areas are unfortunately sparsely populated with them. Among the very best tools for finding a Bitcoin ATM is Coin ATM Radar:

How to purchase Bitcoins anonymously

Privacy is among the significant benefits. Bitcoin users have over others. However, as the marketplace has actually developed and grown, more business have actually ramped up their security. Stronger security steps mean a more powerful concentrate on confirmation of user identities. As an outcome, the majority of cryptocurrency exchanges will need you to supply them with official ID. Evidence of address will likewise in some cases be needed. The very best ways to purchase Bitcoins anonymously are these two approaches explained previously:

What is the very best place to buy Bitcoin?

There is no best location to buy Bitcoin. Many places will declare to be the very best location. And there is a list of the worst places to purchase Bitcoin, so it can settle to search for affordable rates. The buy and sell rate for Bitcoin will differ from one exchange to another. Some platforms will likewise charge you additional charges for moving, exchanging, and withdrawing Bitcoins. The very best location to buy Bitcoins depends on what is most convenient for you.

Inside Bitcoin Transactions: How It All Works

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Are you considering buying Bitcoin or accept them as payment? Then it’s a good idea to understand a bit about how Bitcoin transactions work. Before we enter the technicalities of Bitcoin transactions, it’s worth knowing what precisely a Bitcoin is. According to the Bitcoin white paper, a Bitcoin is nothing more than a record of a transaction. Bitcoins are IOUs, and that’s alright. The money in your wallet is no different. A coin or note is nothing more than a record of financial obligation, which you can redeem for goods or services. With that clarified, let’s take a look at what takes place during a Bitcoin transaction.

bitcoin transactions

How Bitcoin transactions work

A Bitcoin transaction has three components. The first is a transaction output, which is the sender’s Bitcoin wallet address. The receiver’s Bitcoin wallet address is the transaction input. Finally, there’s the amount. Your Bitcoin wallet address creates a transaction output when you send out Bitcoin to another wallet address. The transaction output includes the receiver’s Bitcoin wallet address as a reference to where to Bitcoin went.

The receiving wallet address will, in turn, produce an input when your Bitcoin has been received. The input includes your Bitcoin wallet address as a referral to where the Bitcoin came from. If the individual you sent Bitcoin to decide to send it on to another person, an output with the new owner’s wallet address is developed. The wallet address you sent the money to initially will, in turn, become the transaction input.

bitcoin transactions

Irreversible and immutable transactions

Simply put, a Bitcoin transaction is a record of where the Bitcoin originated from, where it went, and the transaction quantity. All these transaction records are kept in blocks of information. The blocks of data are what makes up the blockchain.

The blockchain is an irreversible and immutable record of every single Bitcoin ever made. Most significantly, you can trace the journey of a Bitcoin to see the number of times it had changed hands from when it was first created.

The difference between public and private keys

You may have heard these terms being bandied around in the cryptocurrency space and question what they mean. To make everything a bit more complicated, your Bitcoin wallet is not a wallet at all. It doesn’t keep your Bitcoin, nor does it save any records. These are all collected on the Bitcoin blockchain.

A wallet is a collection of keys to the blockchain. A public key is a string of characters, much like a bank account number. It allows people to send you Bitcoins. A private key is also a string of characters, but more like a PIN-number for your card. It will enable you to access your Bitcoins.

Bitcoin Mining: How It Works

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What is Bitcoin mining and how does it work? It’s crucial to know how mining works if you’re considering entering it. The term “mining” calls forth pictures of dirt-covered males crawling through tunnels in the pursuit of gold. Bitcoin mining, in spite of its name, could not be further from that situation. In fact, it is the polar opposite of real mining. In this post, we’ll quickly go through what mining is and how it works. The reason Bitcoin mining is called that is due to an unclear similarity to real mining. The gold and the Bitcoins exist, concealed in the tunnels and on the blockchain, but it hasn’t been found and claimed by anyone yet.

bitcoin mining

What is Bitcoin mining doing?

Bitcoin mining is, in truth, really the opposite of gold mining, although the monetary reward is the very much the same. To mine for Bitcoin is to take part in the practice of confirming Bitcoin transactions. That sounds simple, but it is a process that requires very specific, and capable, hardware and software.

Is mining legal?

That depends upon where you are. China, for instance, has provided a blanket ban on mining for civilians because the state subsidizes their energy. Other places, like Iceland, consider it to be legal.

How to begin mining

There are two ways to go about getting started with Bitcoin mining. You can either purchase your mining rig, or you can sign up with a cloud mining service. Googling is needed to discover the best software and hardware so you can build your platform.

 Mining hardware

Your laptop won’t work. You will require to buy an ASIC (Application Specific Integrated Circuits) Bitcoin Miner, which is a piece of equipment mainly designed for Bitcoin miners. The ASIC will get very hot, which is why you’ll likewise need a more cooling fan or a thermally managed environment.

bitcoin mining

Mining software

When you’ve got your mining hardware, it’s time to set up some software application on it. There are a few popular options to select from:

Is mining profitable?

The big question is whether or not Bitcoin mining is lucrative. The brief answer is that it’s not as profitable as it was before. The quantity of processing power and energy it needs to produce one Bitcoin is unaffordable to many regular people. Five business presently control the Bitcoin mining market:

What is cloud mining?

The fact that it has become so difficult for individuals to mine Bitcoin started the concept of cloud mining. Cloud mining allows anybody with a computer to allocate part of their processing power to Bitcoin mining.

Bitcoin Wallets: Everything You Need To Know

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Bitcoin Wallets

What are Bitcoin wallets? You need somewhere to store Bitcoin before you can own it. Unlike a real coin, you can’t just hold a Bitcoin in your hand. Those cool 3D printed Bitcoins you’ve seen aren’t the Bitcoins themselves. They’re Bitcoin wallets. You require a wallet too, and thankfully, there’s a lot to select from. In this guide, we’ll cover how Bitcoin wallets work, and how to store Bitcoin offline if you require to. At the end of this article, you’ll know the distinction between a cold and hot wallet. You’ll also see the difference between a private and a public secret. Lastly, you’ll even comprehend why physical Bitcoins can, in reality, be wallets themselves.

Bitcoin Wallets

What is a Bitcoin wallet?

A Bitcoin wallet is where your Bitcoins are saved. The wallet has an address (like a bank account number) individuals can use to move cash to your wallet. This address is also described as a public key. You have a private key too, which you use to transfer some money from your wallet to another. Bitcoin wallets can consist of numerous public and private keys, and these keys can be kept in any readable format. The primary types of Bitcoin wallets are:

Online wallets

Online Bitcoin wallets are some of the most convenient to set up. The majority of cryptocurrency services, like exchanges and debit card business, will offer you an online wallet.

Mobile wallets

Mobile Bitcoin wallets are downloadable apps that keep your public and private keys. Look for ‘Bitcoin wallet’ on Google Play or Apple’s App Store, and you will quickly find some free mobile wallets

Desktop wallets

Desktop Bitcoin wallets are software apps similar to mobile wallets. The distinction is they are just suitable for your home computer.

Hardware wallets

Hardware Bitcoin wallets are, as the name suggests, genuine and tangible wallets. They are available in the shape of USB flash drives and usually have their software.

Paper wallets

Paper Bitcoin wallets are entirely possible. You can make a wallet out of anything you can doodle on.

Bitcoin Wallets

What is Bitcoin cold storage?

The term ‘cold storage’ refers to any offline storage approach. As you can see from the examples above, hardware and paper wallets are the only method to take your Bitcoin to gain access to offline. That stated hacking attempts are not as commonplace as the media would have you believe. The most popular online wallets are all run by business who focus on security. Their reputation depends on your safety. Just do your due diligence and check out reviews from other users before you rely on anybody.

What is the very best Bitcoin wallet?

Which kind of wallet is the very best for you? Hard to say. It depends upon what you value more: benefit or security. If you choose an online wallet, then you’re dependent on a 3rd celebration to access your Bitcoin. That implies you’re not in charge of security. Mobile and desktop wallets possibly more secure, however still prone to hacking efforts. Hardware and paper wallets are the most reliable choice, as you can take them offline.

Want To Mine Bitcoin? Here’s How To Set Up

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Want to mine Bitcoin? If you’ve read our short articles on how Bitcoin works and what mining is, you may be thinking about mining some Bitcoins of your own. It will require hardware, software applications, and a source of energy that will not cost a lot. The primary two things you must concentrate on when purchasing Bitcoin miner hardware is the hash rate and the energy consumption.

mine bitcoin

What is a hash rate?

Bitcoin blocks take up space. The higher the hash rate of your computer, the more likely you are to verify transaction blocks and win Bitcoins.

Just how much energy does it consume?

The most pricey part of Bitcoin mining is the cost of electrical power. There are particular places where Bitcoin mining isn’t rewarding because of the energy costs.

What Bitcoin mining software app do you need?

You’ll require mining software for your mining hardware, and a Bitcoin client to link to the network.

Standard Bitcoin client

You have to connect your mining rig to the Bitcoin network to start mining. The primary Bitcoin client will connect to your computer, and download the Bitcoin blockchain to your computer. The blockchain is now over 185 GB, so you’ll want adequate space to save it.

Bitcoin mining software

Bitcoin mining software is like an operating system for your mining rig. The sort of software you’ll require will depend on your setup. There are programs offered for CPU/GPU and FPGA setups, regardless of whether you’re using Windows or Mac OS X. Newer ASIC mining rigs will come with their software, but older ones may require you to install a different program.

What Bitcoin mining hardware should you buy?

You have three options when it pertains to Bitcoin mining hardware: a conventional computer system, a customized miner, and a purpose-built mining rig.

What are CPU and GPU?

You can, in theory, utilize any CPU to mine Bitcoin. But devices like your laptop, tablet, and smart device will not get you far. They’ll be sluggish, take up a lot of energy, overheat, and break down before you’ve made any significant profits. You can also set up a powerful graphics card to boost your hash rate. The graphical processing systems (GPU) in graphics cards will assist with the mathematical computations needed for mining.

Why are people still mining this way?

The probability is that they aren’t mining for Bitcoin, but instead other tokens like Litecoin. Whereas Bitcoin needs dedicated mining hardware, other cryptocurrencies have been set up in a method friendly to CPU mining.

mine bitcoin

What is FPGA?

Get a Field-Programmable Gate Array (FPGA). It’s better than CPU and GPU mining rigs. Bitcoin mining hardware manufacturers will buy regular chips and customize them for mining before they install them into computer systems.

What is ASIC?

Purchasing an Application Specific Integrated Circuit (ASIC) is the best option out of these mining setups. They are specially developed to mine Bitcoin at high speeds while keeping energy consumption low. ASICs will get you more bang for the buck, but it’ll likewise cost a pretty penny to purchase.

How To Accept Bitcoin Payments For Your Business

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Accept Bitcoin

Why accept Bitcoin payments? Increasingly, more individuals want to spend their Bitcoin on everyday products and experiences. That means the time to strike is now!

As a company, a small company specifically, you’re in an ideal position to use the Bitcoin market. The variety of companies that accept Bitcoin is still so little that you’re successfully sculpting out a niche.

Whether you’re a burger joint or an e-commerce store, you’ll be head and shoulders above your competitors if you accept Bitcoin and they don’t. The process of setting up Bitcoin payments are both totally free and incredibly smooth.

Bitcoin transactions are very cheap compared to the fees incurred by cards. Every cent counts for a small organization, which makes it an appealing option. There are some disadvantages to Bitcoin, like market fluctuations and regulatory uncertainty.

In this short article, we’ll go through the benefits and drawbacks of accepting Bitcoin payment. We’ll also go through to the steps you need to take.

Accept Bitcoin

How to accept Bitcoin payments

The benefits of receiving Bitcoin payments for your company currently outweigh the dangers. It’s fast and simple to set up your company for Bitcoin payments. Here’s how to do it in three steps:

Action #1 — Get a Bitcoin wallet or Bitcoin POS system

A prerequisite for you to accept Bitcoin payments is to have a wallet where the Bitcoin goes. It’s free and easy to get yourself a Bitcoin wallet.

A Bitcoin Point-of-Sale (POS) system might be needed if you deal with a lot of payments. The POS systems will assist you with transactions, and can also convert Bitcoin into fiat money immediately. The disadvantage is that they charge fees like regular POS systems.

Action #2 — Tell people you accept Bitcoin payments.

Many physical shops will have stickers on their store and till advertising which methods of payment they get. Print out a Bitcoin Accepted Here sticker label and put it next to your Visa and Mastercard stickers. Online shops can likewise put Bitcoin Accepted Here banners on their site.

Action #3 — Research tax regulations

The law surrounding Bitcoin payments can be uncertain at the very best of times. Luckily, there are some accountancy companies now concentrating on Bitcoin bookkeeping and tax. Get one of these companies to assist you out with the books, so you’re on the safe side.

Accept Bitcoin

Benefits of accepting Bitcoin

There are some guaranteed advantages for companies who accept Bitcoin as payment. A few of these benefits consist of:

  • No setup costs
  • Brand yourself as a contemporary organization
  • Take advantage of the Bitcoin holder market
  • Considerably lower transaction fees
  • No risk of chargeback fraud
  • The potential for extra profit as Bitcoin rises in value

Dangers of accepting Bitcoin

As there are advantages to accepting Bitcoins, there are likewise risks to think about. Some of these risks include:

  • Unclear legal structure for Bitcoin in general
  • Possible loss of earnings if Bitcoin crashes

What Is Bitcoin Cash?

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bitcoin cash

What is Bitcoin Cash?

Bitcoin Cash is not, as the name would imply, a cash version of Bitcoin. In truth, it’s not even Bitcoin as you probably know it. Instead, Bitcoin is an entirely different cryptocurrency. It utilizes various blockchain, it is priced differently, and it’s run by a diverse community. It even has a separate ticker.

Bitcoin Core, which is the one you’ve most likely become aware of, is abbreviated BTC. Bitcoin Cash, on the other hand, is shortened BCH. You will likewise discover there are two different websites for each token. You can find BTC on www.bitcoin.org. The www.bitcoin.com website, on the other hand, is focused on promoting BCH.

bitcoin cash

How did Bitcoin Cash come about?

The Bitcoin team reached a deadlock last year, in 2017. The cause was Bitcoin’s scalability issue (read our post Can Bitcoin Scale?). Part of the Bitcoin neighborhood advocated for the implementation of SegWit, which would make transactions much faster. The remainder of the community, nevertheless, did not see it as a viable solution to the scalability issue. Therefore, the Bitcoin neighborhood was split in 2.

Fans of SegWit produced a hard fork in the Bitcoin blockchain which resulted in BCH. The staying block continued with Bitcoin as usual. The original Bitcoin was called ‘Bitcoin Core’ by the BCH community to distinguish between the two.

How is Bitcoin Cash various from Bitcoin?

If you read the information on the Bitcoin.com site, you’ll find many references to the superiority of Bitcoin Cash. Bitcoin Core has been described as less usable as cash due to much higher charges and delayed transaction times. In contrast, Bitcoin Cash’s fees cost pennies and payments can be confirmed even with zero verification.

How is Bitcoin Cash comparable to Bitcoin?

BCH is the outcome of a hard fork; it still operates on the Bitcoin blockchain. Also, the two cryptocurrencies have the same supply limit of 21 million tokens. Of course, 80% of Bitcoin’s 21 million tokens have currently been mined. Meanwhile, BCH was only produced in August 2017, which suggests there are more BCH tokens to be mined. Both BTC and BCH have avoided the issue of inflation by limiting the supply.

bitcoin cash

How to get Bitcoin Cash

Bitcoin Cash has acquired steam rather quickly compared to other new cryptocurrencies. BCH can be purchased on the majority of mainstream cryptocurrency exchanges. Keep in mind that the worth of BTC is around $5,200, whereas BCH is about $400.

How steady is Bitcoin Cash?

The value peaked at around $2,400 in December 2017 when Bitcoin was at its all-time high of $20,000. Since then, it’s dropped significantly in tandem with Bitcoin.

Can Bitcoin Scale?

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can bitcoin scale

Can Bitcoin scale? It usually takes less than a minute for the money to arrive when you make a Bitcoin transaction. That’s fast. It’s only that fast, however, because creative developers have found a way to make Bitcoin run so smoothly. But Bitcoin has a scaling problem. It moves along because the people using it is a relatively small group. Where the number of Bitcoin users to grow substantially, the system would block.

That means Bitcoin can’t replace Visa and MasterCard transactions just yet. Bitcoin can only handle a fraction of their workloads. If Bitcoin is to be the future of the global economy, the scalability problem needs to be resolved. Otherwise, the Bitcoin will eventually lose its momentum and thus its appeal as an alternative currency.

can bitcoin scale

The issue with scalability

Why is there a disparity? Why doesn’t Bitcoin have the same capacity at the credit card companies? It is rooted in the foundation of the blockchain system. Each block on the chain contains 1 MB worth of transaction records. That’s the way it was programmed by Satoshi Nakamoto.

A 1MB block of data takes an average of 10 minutes for Bitcoin miners to process. That’s fine with the present supply of miners and demand from users. Include more users to the mix, however, and the expense of processing transactions increases.

What are the solutions?

One of the options proposed early on was to increase the size of the blocks only. The issue with that solution is that bigger blocks require larger computers to process. If just the those with the most critical computers can mine Bitcoin, then it’s no longer a decentralized network.

In reality, the decentralized nature of Bitcoin is already threatened. A handful of companies mine over half of the Bitcoins on the network. Extreme measures are needed if Bitcoin is to compete with Visa and MasterCard.

Solution 1: SegWit

SegWit stood for Segregated Witness and was introduced by Pieter Wiulle in 2015. Instead of increasing the size of the blocks, SegWit is a way to save more deals in each 1MB block. The solution has been favored by the Bitcoin community and is slowly being embraced.

Solution 2: SegWit2X

Some blockchain expert argues that SegWit is just a short-term option that postpones the inevitable. A stronger option is therefore needed, they claim. SegWit2X was presented in 2017 as an extension of the initial SegWit, which would utilize SegWit and increase the block size to 1MB.

Solution 3: Schnorr signatures

Each Bitcoin transaction has the signatures of all the people involved. These signatures take up space in the blocks of data. Schnorr signatures were established as a method to combine these signatures, so they use up less space. This way they enable more transactions to be stored in each block.

can bitcoin scale

The issue with the Bitcoin scaling options

There is a massive need for Bitcoin scaling solutions. Lots of scaling solutions are proposed by developers, but no one seems to be able to agree on one. It’s difficult to convince everyone on the network to upgrade their software. It’s worth to remember that Bitcoin is a decentralized network with no central authority to guarantee that occurs.

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