Bitcoin today is still too hard for the average person to actually use as money. with high fees and long confirmation times, This is only used as a speculative investment by those who can afford to speculate. those at the margins of society will continue to be shut out from using this coin as an everyday payment network because there just simply isn’t enough room in the blocks.
Three things must happen to address this issue. firstly, segwit should be activated so that the witness discount can be phased in which will increase effective block space enough to allow for on-chain transactions to scale. secondly, we should scale up the lightning network so that this currency’s liquidity is no longer confined to settlement-only channels. the lightning network is currently too expensive to use for anything other than microtransactions or net settlement between payment channels so adoption has been limited thus far, but with segwit and block space scaling this should change.
thirdly, efforts should be made to enable mining decentralization so that blocks are not being mined by just a handful of large pools. this will be an ongoing problem as long as mining is done using ASICs systems which are not widely available to the public. the upcoming bitcoin halving and segwit activation should already ensure that decentralization remains high, but further action taken may be necessary for the future if major pools continue to grow larger.
all three of these issues must be addressed to get more people using them. this is what we mean when we talk about “scaling”. once scaling has been achieved, then the next stage can begin which will be a push for merchant adoption and the creation of user-friendly tools for everyday use.
Bitcoin today level of decentralization will determine whether or not the currency will be able to continue growing. if a small group of people controls a majority of the hashing power then they would be able to use that influence to perform a so-called “51% attack”. this is when an individual or consortium of miners purposely allows invalid transactions into the network to fool other nodes into following their blocks, allowing them to double-spend their transactions. this can be done with a relatively small portion of hashing power so long as more than 50% of it is controlled by one entity that has the intention to perform such an attack. if that were to happen then this crypto would fail because the currency cannot function without decentralization, but more importantly, nobody would trust it anymore after such an attack which is what would kill this cryptocurrency.
While there has been talk in the past about a possible “51% attack” on bitcoin today, it hasn’t ever actually happened because performing one without attacking the whole network simultaneously would be prohibitively expensive. ASIC systems are expensive to create and everyone who uses them knows