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Last Notes

2023-06-07 15:43:45 UTC

- reply

📅 Original date posted:2015-07-29
📝 Original message:On July 29, 2015 7:15:49 AM EDT, Mike Hearn via bitcoin-dev:
>Consider this: the highest Bitcoin tx fees can possibly go is perhaps
>a
>little higher than what our competition charges. Too much higher than
>that,
>and people will just say, you know what .... I'll make a bank transfer.
>It's cheaper and not much slower, sometimes no slower at all.
I respectfully disagree with this analysis. The implication is that bitcoin is merely one of a number of payment technologies. It's much more than that. It's sound money, censorship resistance, personal control over money, programmable money, and more. Without these attributes it's merely a really inefficient way to do payments.
Given these advantages, there is no reason to believe the marginal cost of a transaction can't far surpass that of a PayPal or bank transfer. I personally would pay several multiples of the competitors' fees to continue using bitcoin.
Sure, some marginal use cases will drop off with greater fees, but that's normal and expected. These will be use cases where the user doesn't care about bitcoin's advantages. We must be willing to let these use cases go anyway, because we unfortunately don't have room on chain for everything anyone might want to do.
Therefore, bitcoin tx fees can go much higher than the competition.
Remember how Satoshi referenced the banking crisis in his early work? The 2008 banking crisis was about a lot of things, but high credit card and paypal fees wasnt one of them. There's more going on here than just payments. Any speculative economic analysis would do better to include this fact.