BitCoin 2016

2016 is going to be an exciting year. We are already seeing some fascinating developments in the BitCoin realm. There are five obstacles that Bitcoin really needs to overcome in order to skyrocket to the next level and these things are entirely possible, maybe even this year. Check out this interesting piece.

There have already been dozens of 2016 prediction lists emanating from the broader bitcoin and blockchain community over the past several weeks, so I’ll avoid contributing to the cacophony. After the abysmal results with my personal predictions for 2014-2015, I’ve finally learned to ask more questions and offer fewer forecasts, anyway.

Instead of prognosticating, I’ll offer 10 simple questions for the bitcoin and blockchain industry going into this year.

Next week, I’ll address the broader blockchain ecosystem. This week, I’ve got five questions for bitcoin in 2016:

1. How will scalability be solved?

The growth in bitcoin transaction volumes shows no sign of abating, and yet the 1MB block data limit is no closer to being raised than it was six months ago. Whether and how it is raised (via hard fork or changes to Bitcoin Core) will have lasting repercussions, and changing one of bitcoin’s fundamental rules will have unintended, unpredicted and perhaps negative consequences.

One of bitcoin’s earliest contributors has now written off bitcoin as a failed experiment.

So it helps to remember that the important question this year is not necessarily how bitcoin is scaled, but whether it is allowed to scale without a dogfight.

There are currently only four ways to scale bitcoin today: via lightning networks, via sidechains, via off-blockchain transactions batched by third parties (eg: Coinbase), or by increasing the block-size.

Lightning networks and sidechains aren’t yet ready for prime time, and most technologists would agree that increasing the clout of third-party transaction processors goes against bitcoin’s intended design. No offense to the segregated witness enthusiasts, but that doesn’t sound like a true scaling solution either – more like an optimization.

This means that by mid-2016, we’ll either see a stop-gap resolution to increase the block-size, a hard fork, or a spike in bitcoin transaction fees for smaller transactions. All have their associated risks.

So here’s my question: will the Bitcoin Core block-size limit increase or remain at 1MB?

Read the other four at: