Altcoin Takeover Unlikely Despite Bitcoin Transaction Woes: BitPay CEO

BitPay CEO Stephen Pair has said the company “thinks it’s unlikely” an altcoin will surpass Bitcoin because of network congestion.

In a Medium post on Tuesday, Pair said that despite the “exponential” rise in mining fees, Bitcoin will remain the currency of choice, with the future involving increasing the security of off-chain transactions.

“In 2011, I would have never imagined we’d still be living with a 1mb block size limit in 2017,” he wrote.

Miner Fees paid by BitPay

BitPay’s monthly mining fee costs have risen 3,500 percent since January 2016. “If we factor out our transaction growth of nearly 3x, it is still nearly a 12-fold increase,” Pair added.

As Bitcoin users everywhere are finding out, the “true value of having a transaction secured by the most powerful computing network mankind has ever deployed” is still uncertain.

Debate over how to resolve the now pressing issue continues often to take the form of a politically-charged battle of wits. Only a few commentators - including Andreas Antonopoulos as well as Pair - get to grips with the practicalities of specific solutions from a more neutral stance.

The topic in focus for both is the pros and cons of off-chain transactions.

“[...If] several projects (like the lightning network) materialize, off-chain payments will become safer and more secure than more conventional off-chain payments,” Pair continued.

“On-chain payments will still be the most secure option, but with adequate alternatives, demand for on-chain payments will abate.”

In a previous post in January, Antonopoulos expanded on the issue, also supporting the development of off-chain solutions.

He stated:

“Our choice is between:

Off-chain trusted third-party custodial — Exchanges using databases for off-chain transactions, with very poor security fundamentals and where trust is required (counterparty risk).

Off-chain trustless custodial — Lightning network/TumbleBit second layer solutions that are trustless and eliminate counterparty risk by using Bitcoin transactions instead of SQL databases...

No SegWit/No [Lightning Network] does not mean on-chain transactions. It means on-coinbase transactions, which is worse.”