Oddbean

You can do it today because it's cheap and easy. Let's run the numbers on how that is expected to look in the future. https://image.nostr.build/f17bd71e9c6f58321a321642ac554654af23e6b0a95abaae27d627ab804eeb97.jpg We're gonna use astronomer math. We're only looking at orders of magnitude. There are maybe 100 million bitcoin owners. There are soon going to be 10 billion people, increasing at an exponential pace. If we want 10% of people to trustlessly self-custody (this is a very low bar) we need to scale 100x. An average tx on mempool right now is 37 cents. That's pretty cheap, actually. Imagine if the cheapest transactions ever got was $37. That's 10% of people in 10 years. Extrapolate to 100% in 50 years (population doubles every 47 years), you need another 100x. That's $3700 for a one input, two output transaction. Used car money. You need to buy a new used car every time you interact on-chain. Wanna do a coinjoin? You're gonna need house money. This assumes no new use cases for on-chain space. This could not be more wrong. Quantum computers are coming. Post quantum signature schemes A) will require a soft fork and B) are also very large, so let's divide transaction throughput by 10-100x. On-chain stablecoin transactions are just getting started. That's a huge market, multiple times larger than the lightning network today. Ark service providers will be ticking out transactions at a steady clip. These are time-sensitive transactions so they will pay the prevailing fees to get on chain. BitVM is building an entire computer using logic gates encoded in bitcoin script. Those will be very large scripts. ZKPs are extremely promising and extremely large. We can't keep people from storing them on chain. Bitcoin is permissionless. Don't forget about ordinals! Did you think they were just gonna go away? Lol, you silly goose. There will still be degens using up your precious blockspace. Bitcoin simply does not scale well enough to serve the whole world. We need better tools on the base layer or else we are just LARPing about freedom technology.

It's also a good response for people pushing to "upgrade" L1 nostr:nevent1qqs0jtlau7vzpxe42n6zau24xtdtztk62l84xfta7njpnh09hk3us8qpz4mhxue69uhhyetvv9ujuerpd46hxtnfduhsygxnq5k28c74ywc7eqr8r6cmhgz30gh4ytse2audeq7aqw5dsjshpcpsgqqqqqqsmtxfcm

Same thing happened with gold. What happened to the gold standard? All the gold flowed into the government vaults and they forced the people to use paper receipts. Then they rugged the hard money backing for the paper receipts and started printing. How do you avoid this future when the average person can't afford to self custody?

Astronomer math is fun because you can be way off and it kinda doesn't matter. > There are maybe 100 million bitcoin owners. There are soon going to be 10 billion people, increasing at an exponential pace. If we want 10% of people to trustlessly self-custody (this is a very low bar) we need to scale 100x. This was 10x too high. > Quantum computers are coming. Post quantum signature schemes A) will require a soft fork and B) are also very large, so let's divide transaction throughput by 10-100x. This was 10x too low. It's a wash. ¯\_(ツ)_/¯

Yeah my first mistake was a simple off by one error: 10% of 10B divided by 100M is 10x not 100x. But looking at it again today I think that 100M number is very sus. We should hit 10B people in the 2040s. This is a pretty reliable estimate. So 10% self custody in the 2040s puts us at 1B bitcoiners. We currently have ~100M "bitcoin users" but this counts Coinbase accounts, ETF holders, etc. The actual important metric is how many people are using the blockchain. How many self custody users do we have today? Probably closer to 1M actually. So maybe the first 100x figure actually should have been 1000x. The quantum signature stuff is the most unclear because there are lots of different algorithms to choose from. This fantastic analysis indicates that SPHINCS+ is the frontrunner by a large margin. Those sigs are 100x bigger than current signatures. I estimated 10-100x so this indicates we'll land closer to the top of that range without some big optimizations. https://conduition.io/cryptography/quantum-hbs/ In any case, you get the idea. We need to scale exponentially and bitcoin just does not do that today.

Good points, though I hope your swag at only 1M is pessimistic 😢 I’ll have to check this link out, thanks! So much to learn, so little time…in the meantime, can everyone stop innovating so the rest of us can catch up 😮‍💨

I got the 1M estimate from here. 4.2M == 1M in astronomer math. > Let’s say we use an assumption for average addresses per person to be 10 — which is just a rough guess — then the ceiling of bitcoin users who have their own addresses is around 4.2 million. https://bitcoinmagazine.com/markets/an-objective-look-at-bitcoin-adoption