Bitcoin is no stranger to controversy, but debate about a new version of the cryptocurrency announced recently is overshadowing its potential appeal.
On Saturday, bitcoin developers Gavin Andresen, chief scientist at the Bitcoin Foundation, and Mike Hearn, a former Google software engineer, released Bitcoin XT, a competing version of bitcoin software that allows for larger “blocks” of data in which transactions are processed.
Bitcoin XT would let the blockchain, a public database of transactions that can be modified by all users, accept blocks of data that are larger than 1 megabyte. The limit had been incorporated into the current system by Satoshi Nakamoto, the mysterious founder of bitcoin, but has been debated because it limits the number of transactions that can be processed by the block chain system — currently about three to seven per second.
Under Bitcoin XT, the system would support blocks of up to 8MB, which would allow up to 24 transactions per second. While that’s far below the capacity of major credit card networks, it could be an important step in widening the appeal of bitcoin for mainstream users. If users have long wait times to confirm transactions, bitcoin will struggle to gain adherents beyond its current niche.
To succeed, Bitcoin XT will have to gain enough supporters so that it’s seen as the legitimate form of bitcoin. Traditionally, if 75 percent of blocks are processed with a new release of the software, it is seen as adopted by the community. A disastrous scenario would be two competing and incompatible versions of the software.
The promise of bitcoin is that it can be a decentralized vehicle for transferring currency through the Internet quickly, anonymously, at minimal cost and without needing a third party to confirm the payment. The possibilities are vast, not only with cryptocurrency but other applications Originally appeared at: http://www.channelworld.in/features/bitcoin-xt-debate-overshadowing-growth-opportunities
Originally appeared at: http://www.channelworld.in/features/bitcoin-xt-debate-overshadowing-growth-opportunities