Nice pick-up "dawatz". Change in this world seems to be happening at an exponential rate. It’s enough to make your head spin!
Soon after my post associating Blockchain with SAS, I came across a new crypto, IOTA. Unlike Bitcoin and all other cryptocurrencies, Iota is based not on the blockchain but on a revolutionary new format – the ‘tangle’.
Here is a short video explaining the difference between “Bitcoin on Blockchain” and “IOTA on Tangle”.
IOTA has been created as the backbone for the Internet of Things (IoT). Focused on M2M data exchange the tangle allows for these exchanges to take place with NO transaction fees.
In the Dawatz’s linked article “Blockstream Is Using Satellites to Beam Bitcoin Down to Earth”, there are a number of claims made that I find rather spurious.
They claim to be able to “…… use the satellites to download a working bitcoin node capable of storing the network's entire transaction history.”
I don’t doubt that at all. However a fully functioning node needs to have the computer power to access the blockchain to verify and confirm transactions. This not only requires sophisticated and expensive computer equipment, it also requires a constant source of cheap power.
“bitcoin proponents who believe the cryptocurrency could be especially beneficial to people without internet, who also generally live in areas with economic instability.”
Exactly, that was the while whole crux of my post. However, at that time I was unaware of the fact that all transactions done on a blockchain, expend equipment cost and power that needs to be recouped by the miners as their reward for keeping the blockchain alive and correct. These expenses result in a fee being charged for every transaction. If the transaction is one of 10’s or 100’s of dollars, it is not such a big deal, but if we are talking smaller transactions of a few dollars or even a few cents, a transaction fee of $1 or more makes it totally unviable.
Transactions via the Iota Tangle requires no expensive verification of a transaction (refer to video) which makes even micro or nano transactions totally feasible.
“….the project is all about putting bitcoin into the hands of those who "desperately need" it.”
I could not agree more. Empowering people with the opportunity to engage in free commerce can be a truly life changing experience. However, it won’t happen with Bitcoin or any other cryptocurrency that is based on a resource & power consuming blockchain.
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While running a full node is a cumbersome process, it's nonetheless the most secure and trustless way of using the digital currency,..”
Yes, cumbersome and expensive. As long as blockchain is able to be ‘hacked’, it will always be insecure and as such, not truly trusted. Because of the way the Tangle is constructed, is it NOT possible to be hacked.
“Users will need a small satellite dish – if they already have a TV satellite, they could use that – and a USB to connect the satellite to a personal computer or a piece of dedicated computer hardware such as a Raspberry Pi. The rest can be accessed through free, open-source software, such as GNU Radio for establishing a radio connection.”
Sure………… I just can’t see too many native villages in the Sahara or Amazon with that sort of infrastructure. Desk and laptop computers are going the way of VHS and Kodak film. The mobile phone and wearable connections is where transactions will take place in the future. A phone connection is all that is needed.
"The cost to entry is extremely low," said Blockstream's head of satellite, Chris Cook. According to him, the package of equipment costs "a little under $100 dollars."
Sorry!........ IMO even $10 is it too expensive. The ability to transaction in a cryptocurrency needs to be done with NO cost or fees involved. All that is needed is a charged mobile phone.
“Back argued cheaper communications technologies, such as SMS or bi-directional satellite, could be used instead.”
Hello!............... and that is what SAS is all about. Implement a crypto wallet into every SAS based smart phone in countries that have a ‘real’ need to become more financially independent, and we can change the whole dynamics of the financial world for those people………….. amazing stuff!
“Transactions, he said, take up about 250 bytes, which wouldn't cost more than one penny to transfer using such technologies.”
One penny for a transaction fee is simply not true. Blockchain is not economical for small transactions, due to its relatively high fees nor is it feasible or possible if there are 1,000’s per sec of transactions required to be facilitated on the block chain as acceptance and use increases.
The more transactions, the longer the verification time. Currently Bitcoin is struggling to push through 10+ x transactions per second. Iota, because of the tangle structure, has no scaling issues and can transact 1,000+’s per second with no fee.
“…… a small hut on the side of the road in the Sahara Desert in Africa,……:
"With a perpetual generator out back with a satellite dish, a raspberry pi by the generator, a local wi-fi hot spot, and the necessary software set up, you could be transacting globally with bitcoin."
“Perpetual generator” – is he talking solar panel or some Tesla gizmo on the drawing board? I’d like to see a cost / benefit analysis between Back’s Bitcoin Satellite plan and one that might involve a downloadable IOTA coin wallet to a SAS connected mobile phone!
“While the project is technically feasible, though, is it financially so?
I doubt that it’s technically feasible (at this stage at least), so the cost is irrelevant. It is interesting to see how blockchain has evolved in such a short period of time. From what I can gather, it’s use as a platform for ‘small contracts’ (like Ethereum) better suits blockchain than a medium of currency exchange.
Because of its very protocol, it strangles itself in power consumed through the verification process and the need to reward miners that necessitate a fee being charged for every transaction.
At this point in time, and who knows what the future brings, it appears to me that Iota has it all over Bitcoin and a medium of exchange, simply because there are no transaction fees and the ability to transact through the tangle enable 1,000’s of transaction per second.
The synergies between Iota and SAS would certainly be worth perusing......not only for the crypto side of the equation, but for a multitude of other benefits that surround the highly efficient M2M data transfer capabilities.
