Quote from: Pangia on March 31, 2013, 04:17:53 AM

Cryptocurrencies have a secondary problem in that because they are not self-validating there is a time delay between your proposed transaction using a given token and when you can know that the token is valid. Bitcoin typically takes a few minutes (about 10) to gain reasonable certainty that a given token is good, but quite a bit longer (an hour or so) to know with reasonable certainty that it is good. That is, it is computationally reasonable to believe after 10 minutes or so that the chain integrity you are relying on is good. It approaches computational impracticality after about an hour that the chain is invalid.

This is not a problem where ordering of a good or service and fulfillment is separated by a reasonable amount of time, but for "point of transaction" situations it is a very serious problem. If you wish to fill up your tank with gasoline, for example, few people are going to be willing to wait for 10 minutes, say much less an hour, before being permitted to pump the gas -- or drive off with it. This makes such a currency severely handicapped for general transaction use in an economy, and that in turn damages goods and service preference -- the ability to use it to exchange one good or service for another. What's worse is that as the volume of transactions and the widespread acceptance rises so does the value of someone tampering with the block chain and as such the amount of time you must wait to be reasonably secure against that risk goes up rather than down.

I am newly aware of Bitcoin (1 week now Wink

) and believe it has many appealing characteristics as a future currency. Although I don't agree with most of the pasted opposition, there was one point made (quoted above) that has me conflicted. For a crypto-currency to ever become successful in the normal operation of society, transactions must be conducted rather quickly, if not instantaneously. I'm finding it rather difficult to even obtain BTCs let alone imagine them one day being used in normal commerce with literally millions of global transactions occurring every second. I'm sure this has been discussed in detail many times on this forum, so someone please provide the prevailing wisdom to this problem.