Close

Hmmm, you are using a Gmail.com email address...

Google has declared war on the independent media and has begun blocking emails from NaturalNews from getting to our readers. We recommend GoodGopher.com as a free, uncensored email receiving service, or ProtonMail.com as a free, encrypted email send and receive service.

That's okay. Continue with my Gmail address...

Cryptocurrency can NEVER work as a nationwide transaction system warns the BIS; blockchain will explode to over 100 TERABYTES of ledger data


If you’ve been following Natural News for any length of time, you may already know that cryptocurrencies like Bitcoin suck up mass amounts of energy just to keep functioning normally. But have you ever considered the sheer amount of data storage space that’s necessary to keep the blockchain going?

A new report by the Bank of International Settlements (BIS) entitled, “Looking Beyond the Hype,” takes a closer look at this, revealing that the data requirements of crypto are so large that it would be near-impossible to scale them nationally for currency purposes.

One chapter in the report, entitled The Money Flower: A Taxonomy of Money, explains how one of the key components of any proper money system is accessibility. Another is a payment transfer mechanism that’s both functional and efficient. So is any of this true for cryptos like Bitcoin? Not exactly.

While Bitcoin has the advantage of being decentralized, meaning it isn’t controlled by a private central bank like Federal Reserve Notes are, it lacks the ability to process tens of thousands of transactions at once. Instead, it’s only able to process a small handful, and at great expense to users of the platform.

The other problem is that cryptos have no intrinsic value, and represent nobody’s liability, meaning they cannot be redeemed like U.S. dollars can. The only value they possess is the expectation that they will continue to be accepted by others, which makes them akin to “commodity money.”

There’s also the risk of what’s known as the “double-spending problem,” which basically encompasses the possibility that savvy hackers might try to spend their cryptos more than once. The peer-to-peer blockchain leaves vulnerabilities like this that a centrally-controlled blockchain doesn’t, posing additional problems.

Sponsored solution from the Health Ranger Store: Lab-verified Nascent Iodine solution is a dietary supplement that provides your body with supplemental iodine to help protect your thyroid during radiation exposure. Nuclear accidents such as Fukushima (or nuclear war) can expose your body to radioactive iodine-131, a dangerous radioisotope. Pre-loading your system with stable iodine occupies the iodine receptor sites on your organs, causing your body to naturally expel radioactive iodine you may have been exposed to through air, food, water or milk products. This defensive strategy is recommended by nearly all health authorities, worldwide, including the Nuclear Regulatory Commission. Discover more at this link.

Bitcoin blockchain is growing exponentially in size – with no end in sight

There are various ways that blockchain ledgers can be updated in order to avoid this, including the distributed ledger model in which every participant is given a copy of the new ledger each time it’s updated in order to verify it. But there are also what are known as “permissionless” ledgers that allow changes to be made through consensus rather than through individual verification.

This is the model that Bitcoin uses, and it requires a tremendous amount of electricity to keep maintained – not to mention expensive computer equipment that has to be updated constantly in order to keep up. What’s known as a “proof-of-work” process is also included as part of this blockchain model, as it keeps the whole system going.

So what’s the problem? In order for the peer-to-peer system to work, every user must download and verify the entire history of all transactions ever made, including the amount paid, the payer, the payee, and other important details – which takes up an incredible amount of space!

With each transaction adding another few hundred bytes to the ledger, this can grow substantially in not that long of a time period. Currently, the Bitcoin blockchain is growing at around 50 gigabytes (GB) per year, and is already as large as 170 GB. In no time, the size requirements will balloon into terabyte (TB) territory, requiring larger and larger hard drives – not to mention increasingly more processing power.

“… the issue goes well beyond storage capacity, and extends to processing capacity: only supercomputers could keep up with verification of the incoming transactions,” explains The Maven about this growing problem.

“The associated communication volumes could bring the internet to a halt, as millions of users exchanged files on the order of magnitude of a terabyte.”

For more news on Bitcoin, check out BitRaped.com.

Sources for this article include:

NaturalNews.com

TheMaven.net

Receive Our Free Email Newsletter

Get independent news alerts on natural cures, food lab tests, cannabis medicine, science, robotics, drones, privacy and more.



Comments
comments powered by Disqus

RECENT NEWS & ARTICLES