Traffic congestion in the bitcoin network has returned as the currency fails to meet demand with some 70,000 transactions stuck, waiting to move.
The now somewhat familiar cyclic event is occurring at a capacity of just 300,000 transactions a day, close to half that of eth, which now handles 550,000 transactions a day at times.
But while eth manages it at sub-penny fees, bitcoin’s network fees have increased to near $3 at the time of writing. Making it uncompetitive with alternative methods of payment, including digital currencies like eth, but also Visa and even PayPal.
However, not all are unhappy with the congestion and the fees. Rusty Russell, Blockstream’s employee, stated:
“You’re going to have to pay fees, sorry. Satoshi’s free ride part 1 is over, and part 2 will end soon.”
It’s unclear what he means by part 2. Presumably Blockstream is planning to increase fees to $20 or $30 per transaction, making bitcoin unusable save for absolutely necessary on-chain transactions.
The aim is presumably to encourage the use of the Lightning Network, but many argue it might also be part of Blockstream’s for profit business plan.
Adam Back, Blockstream’s CEO, recently said they plan to make profits by selling “side chains to enterprises, charging a fixed monthly fee, taking transaction fees and even selling hardware.”
Something which may benefit as an alternative to a congested bitcoin network, potentially explaining why it appears to be almost exclusively Blockstream employees that are so vocally against a very modest increase to the blocksize.
Even Peter Todd, once a vocal proponent of very small blocksizes, has seemingly taken a back seat, with just Blockstream employees appearing to argue daily for maintaining the network congested, fees high, and even, according to Russel, with plans to increase them far higher.
Whether that will indeed be the case remains to be seen as the segwit2x fork now nears with the vast majority of miners continuing to show support for it, while businesses have stated they will follow the longest chain.
That should double capacity instantly, with bitcoin so once more having the ability to meet the considerable demand for on-chain peer to peer transactions and value exchanges.