By CCN: Early Bitcoin developer Jeff Garzik revealed what he believes is the most daunting challenge the flagship cryptocurrency faces today. He also chimed in on the “economic paradox” that threatens to stifle Bitcoin development.
Bitcoin’s Biggest Hurdle? Scaling. Scaling. Scaling.
Speaking in an exclusive interview with CCN, Jeff Garzik, who was one of Satoshi Nakamoto’s earliest collaborators and also founded crypto startup Bloq, admits his highly “predictable” answer when it comes to the biggest challenge facing Bitcoin would be “scaling.”
Bloq founder Jeff Garzik presents Metronome, along with project co-founder Manoj Patidar, at Consensus 2019. | Source: Justin O’Connell/CCN
But, there’s a deeper problem than that, Garzik warns.
“The pace of innovation of the core of Bitcoin is slow and it’s a real challenge,” he told CCN from the Bloq room at Consensus 2019. “If you onboard a bunch of people on Lightning, stuff like that, the transaction fees go up to the point where [most people] just can’t afford to use bitcoin.”
Bitcoin is WAY Too Expensive
One of Garzik’s favorite statistics is that an individual is in the top 1% worldwide if they earn an annual salary worldwide of $32,000. He fears that bitcoin transaction fees risk excluding anyone who doesn’t live in the US or EU from participating in the network.
“That’s the top 1% worldwide,” he says. “And so that tells you that, if you have to pay $10 for a Lightning transaction, that leaves Bitcoin to [people in] the US and EU and that’s it. We just excluded the rest of the world due to transaction fees.”