[cryptography] bitcoin scalability to high transaction rates
dan at geek.com.au
Thu Jul 21 20:45:44 EDT 2011
On Thu, Jul 21, 2011 at 08:47:35AM -0700, Nathan Loofbourrow wrote:
> It's only when money is transferred
> into our out of the exchange that a "real" transaction needs to be created,
> whether though Bitcoin or through a bank. Private markets can help aggregate
> small transactions.
.. as well as help 'blind' these transactions to later log analysis
(depending on what they do with their internal logs).
> Of course, this presumes you trust the exchange, which is a different
Indeed. Note, however, an interesting convergence property here, for
the practical user:
Say I'm selling something on 'bitbay'. Bitbay offers me two kinds of
accounts: either immediate transactions to the bitcoin network, or an
internal/affiliate 'Bitpal' account, with a running internal balance and
aggregate external settlement transactions.
I need to decide whether to trust the Bitpal exchange, both as a
holder of credit and potentially also as a privacy-blinding service,
presuming they claim to offer this value-add. Fine.
However, in practice, both mean I need to wait some time for my money,
even for the "immediate" transactions, until a sufficient consensus of
conmation blocks comes in. So on the face of it, there's little
difference in my process for deciding when to ship my paid-for
product. The only way to make it go faster, where that matters, is to
trust the exchange's internal accounts - that is the service they
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