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editing section 2

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Christian Grothoff 2016-08-23 12:45:55 +02:00
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articles/ui/ui.tex
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@ -361,15 +361,16 @@ The information in the global public ledger allows everybody to
compute the balances in all accounts and to see all transactions.
Transactions are denominated in a new currency labeled BTC, whose
valuation depends upon {\em speculation}, as there is no authority
that could act to stabilize exchange rates. Adding transactions to
that could act to stabilize exchange rates or force anyone to
accept BTC as {\em legal tender} to settle obligations. Adding transactions to
the global public ledger involves broadcasting the transaction data,
peers verifying and appending it to the public ledger, and some peer
in the network solving a moderately hard computational proof-of-work
puzzle, which is called {\em mining}.
The mining process is incentivised by a combination of transaction
fees and mining rewards. The latter process also provides primitive
accumulation~\cite{primitiveacc} for BTC.~\cite{nakamoto2008bitcoin}
fees and mining rewards~\cite{nakamoto2008bitcoin}. The latter
process also provides primitive accumulation~\cite{primitiveacc} for BTC.
Conversion to BTC from other currencies and vice versa incurs
substantial fees~\cite{BTCfees}. There is now an extreme diversity of
Bitcoin-related payment technologies, but usability improvements are
@ -385,7 +386,7 @@ possibly include additional metadata to be associated with the
transfer and embedded into the global public ledger. The wallet
application would then transmit the request to the Bitcoin
peer-to-peer overlay network. The use of an external payment
application makes wallet-based payments significantly less
application makes payments significantly less
browser-friendly than ordinary card payments, as illustrated in
Figure~\ref{fig:bitcoin}. This has led to the development of
browser-based
@ -408,8 +409,8 @@ resources to keep this value high.
According to~\cite{vice_btc_unsustainable}, a single Bitcoin transaction uses roughly enough
electricity to power 1.57 American households for a day.
These costs are largely hidden by speculation in BTC,
but that speculation itself contributes to BTC being
unstable.~\cite{jeffries_economists_v_btc,lehmann_btc_fools_gold,lewis_btc_is_junk}. % exacerbating risk
but that speculation itself contributes to BTC's valuation being
volatile.~\cite{jeffries_economists_v_btc,lehmann_btc_fools_gold,lewis_btc_is_junk}. % exacerbating risk
% fees hit you 2-3 times with currency conversions
% more on massive transaction fees from blockchain.info
@ -417,7 +418,7 @@ unstable.~\cite{jeffries_economists_v_btc,lehmann_btc_fools_gold,lewis_btc_is_ju
Bitcoin's pseudononymity applies equally to both customers and
merchants, which makes Bitcoin amen\-able to tax evasion, money
laundering, and sales of contraband. As a result, anonymity tools
like mixnets do not enjoy particularly widespread support in the
like mixnets do not enjoy widespread support in the
Bitcoin community where many participants seek to make the currency
appear more legitimate. While Bitcoin's transactions are difficult to
track, there are several examples of Bitcoin's pseudononymity being
@ -426,7 +427,7 @@ the development of new protocols with better privacy protections.
\begin{figure*}[t!]
\includegraphics[width=\textwidth]{figs/paypal.pdf}
\caption{Payment processing with Paypal. (From: W3C Web Payments IG.)}
\caption{Payment processing with PayPal. (From: W3C Web Payments IG.)}
\label{fig:paypal}
\end{figure*}
@ -434,7 +435,7 @@ Zerocoin \cite{miers2013zerocoin} is such an extension of Bitcoin:
It affords protection against linkability of transactions,
but at non-trivial additional computational costs even for
spending coins. This currently makes using Zerocoin unattractive
for payments, espcially with mobile devices.
for payments, especially with mobile devices.
Bitcoin also faces serious scalability limitations, with the classic
implementation being limited to at most 7 transactions per second
@ -446,7 +447,7 @@ Amongst these, the Blind Off-chain Lightweight Transactions (BOLT)
proposal~\cite{BOLT} provides anonymity by routing off-blockchain
transfers through bank-like intermediaries. Although interesting,
there are numerous seemingly fragile aspects of the BOLT protocol,
including aborts deanonymizing customers, intermetdiaries risking
including aborts deanonymizing customers, intermediaries risking
unlimited losses, and theft if a party fails to post a refute message
in a timely fashion.
% Of course, Taler itself could be used to provide a side-chain like technology