Stop Mischaracterizing the Lightning Debate
When feeling masochistic I have a look through the Roger Ver side of twitter. Though I enjoy the various conspiracy theories and rage postings, nothing delights more than a @bitcoin straw man meme – set up and then thoroughly destroyed with the zeal of a committed LARP.
Let’s have a look at one now.
OK, so the boys @bitcoin are framing the debate as being between either bitcoin cash’s big blocks or the lightning network. This either/or fallacy suits Ver types, because any hiccup in development can immediately be seized upon to demonstrate the superiority of their on-chain approach. In reality, lightning is an early-stage technology that has rolled out faster than expected and generated a good deal of excitement in its potential, but has no effect on bitcoin at the present time.
The debate is not between lightning and on-chain scaling
The debate is about the importance of decentralization in scaling efforts. Bitcoin Cash shows just how easy it is to raise the block limit. No fancy engineering required, most self-taught developers can handle erasing a ‘1’ and pasting an ‘8’ in place, or even erasing an ‘8’ and putting a ‘32’. (Will they erase 32 and put a 64? Stay tuned!) For bitcoin developers however, the fundamental issue is to ensure scaling implementations do not increase the cap on the blockchain’s growth trajectory. The debate centers on the importance or legitimacy of this decentralized-first approach, and it is probably the fundamental difference between bitcoin and bitcoin cash supporters.
The arguments for or against this position are outside the scope of the article. But a bit of perspective. Since the fork in August of 2017, the bitcoin cash blockchain has increased in size by approximately 10%, from 127 to 141 gigs. The bitcoin blockchain rate of growth is 450% greater than that, though Segwit has reduced to some extent the actual weight of these transactions. Point being that, thanks to low usage KPIs, bitcoin cashers have the luxury of pontificating theoretically about Moore’s Law and how it will ensure no negative effect on node distribution. This means nothing in real life because bitcoin cash is not being used all that much. For Bitcoin, raising the block size would already have had repercussions, i.e. an even heavier blockchain which takes longer to download, eats up more memory, and leads to an indeterminate effect on node KPIs.
Nobody says that ‘LN solves the scaling issue now’
@bitcoin also mischaracterizes the position of bitcoin supporters on the current state of the lightning network.
Nobody (nobody I have seen anyway) is arguing that lightning currently solves the bitcoin scaling issue. Rather lightning is seen as a promising and relatively early stage second layer protocol that could serve as a long term solution to scaling, as well as to facilitate additional use cases like smart contract applications and instant transactions. The jury is out. There is generally agreement that, like the internet itself, true, exponential and sustainable scaling will need to come from a second level protocol.
Whether or not Lightning works, however, does not have an impact directly on the bitcoin protocol. And this is a very important point.
Do No Harm
Lightning is a do-no-harm scaling technology because if it fails it will not impact the actual blockchain or the network directly. This is not necessarily the case with a large block size cap raise. Bitcoin cash supporters ascribe to the view that larger blocks would be absorbed without doing damage to the network’s decentralized nature. Maybe they are right. However, there is a good chance they are wrong. What if bitcoin were to implement a vastly larger block size and then … blockchain bloat did indeed push non-mining nodes out and verification slowly centralized into the hands of big miners and large data centers hosted by coinbase and the like? There is no do over, and the network just forfeited the one thing that made bitcoin unique – true decentralization and all that comes with it – in exchange for something that is not unique: more efficient, cheaper transactions.