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Any technical solution for Lx improving some aspects of L1, will have to sacrifice on some other properties of L1, otherwise it would be "a better L1 than L1" and thus should just replace it. L1 is optimized for censorship resistance (small footprint, no trust, low complexity)
at the cost of poor: scalability (number of users/UTXOs & payments), confirmation time and privacy.
Big blockers wanted to compromise on C.R. for scalability.
Federated side-chains improve scalability and other prop. of L1 at the cost of federated custody.
Big blockers wanted to compromise on C.R. for scalability.
Federated side-chains improve scalability and other prop. of L1 at the cost of federated custody.
Non-custodial LN improves privacy, settlement time and scalability of number of payments, at the cost of pre-setup, locked funds, complexity, trust model. Notably it improves scalability of number of payments by *a lot*, but scalability of UTXO ownership by not much if at all.
Custodial LN improves scalability of UTXO ownership over Custodial LN at... a lot of costs.
Cashu (custodial mints) can be thought of Custodial LN, but users get perfect privacy.
Fedimint (federated mints) get perfect privacy, great scalability of UTXO ownership,
Cashu (custodial mints) can be thought of Custodial LN, but users get perfect privacy.
Fedimint (federated mints) get perfect privacy, great scalability of UTXO ownership,
can be paired with (and thus gain benefits) of non-custodial LN (no extra trust). That's *a lot* of benefits for federated custody. And not single federation. *You can be a part of your own federation*, even N-of-N one (no trust).
We need to accept *some* tradeoffs somewhere.
We need to accept *some* tradeoffs somewhere.
We can't hope for some impossible perfect solution to arrive.
The way I see it - in hyperbitconized word L1 will be used only for settlements between biggest institutions and wealthiest individuals. *There's just not enough UTXOs and blockchain space for anything else.*
The way I see it - in hyperbitconized word L1 will be used only for settlements between biggest institutions and wealthiest individuals. *There's just not enough UTXOs and blockchain space for anything else.*
Individuals will have to share UTXOs some way. To avoid >$1k-worth of L1 tx fees, and get some privacy.
Sharing UTXOs is an inevitability. And best solution for that are N-of-M federations. Either side-chains, federated mints, state chains, or some LN chain factories.
Sharing UTXOs is an inevitability. And best solution for that are N-of-M federations. Either side-chains, federated mints, state chains, or some LN chain factories.
Chaumian e-cash seems like a best way to give owners of each shared UTXO perfect privacy. Even most non-custody-conservative people might want to run their own internal/controlled instance of a mint, just to allow privacy is others.
Shared UTXOs owned by groups will be inter-connected with LN channels (in the future maybe directly, currently via LN-gateways).
And this Bitcoin-based financial system could practically serve the whole globe. With everyone getting great privacy, near instant payments,
And this Bitcoin-based financial system could practically serve the whole globe. With everyone getting great privacy, near instant payments,
censorship resistance, no money printing, with zero to minimal custody risk (depending on the size of funds in question).
If you have an alternative holistic vision of the such global Bitcoin-based financial system I'd be happy to hear it.
If you have an alternative holistic vision of the such global Bitcoin-based financial system I'd be happy to hear it.
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calle ⚡ @callebtc
·
Dec 29, 2022
Great thread! Sorry if I got it wrong but I read your thread as saying: with federated approaches *you* the user own shares of an UTXO. That's not true though. It's the mint (not the user) who has *full* ownership, be it a single mint or a distributed (federated) entity.