I’m always surprised by how little people seem to understand the technical details of Bitcoin (and the other cryptos). The PC etc. could grow in adoption because there was no impediment to scaling. More PCs could be made by building more factories.

But that’s not the case with Bitcoin. It’s maximum theoretical transaction per second rate is 7. Today it’s hovering around 3. With a significant amount of work, it’s theorized that one day Bitcoin could actually handle 27 transactions per second, worldwide.

To put that into perspective, VISA handles 65,000 transactions per second today, and can easily be scaled to handle much larger volumes. And VISA is a relatively modest player in the scheme of global transactions.

The real analogy isn’t with PCs or any other device. The real analogy is with something that’s intrinsically self-limiting because of its physical architecture. Sure, it seems amazing that someone would design something so inherently non-scalable, but guess what? They did. And that’s why all the hype about Bitcoin is just hype. And that’s why, when the momentum-investing driven bubble pops, Bitcoin will vanish from history.

But until then, a lot more people will get a lot more excited about something they fundamentally don’t understand.

Written by

Anyone who enjoys my articles here on Medium may be interested in my books Why Democracy Failed and The Praying Ape, both available from Amazon.

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store