Ryan X Charles, the CEO of Money Button and a Bitcoin Cash SV proponent spoke about the concept wherein we don’t need to change the Bitcoin protocol to solve its problems, on his latest Youtube video.
Charles remarked that the concept is that Bitcoin can be used to solve problems that are prevalent with Bitcoin, stating that there was no need to change the protocol. He added that this is a “very simple idea” and stated:
“it’s basically the idea that if you have some type of issue like a particularly instant transactions or scaling, you can actually create businesses that create value for people and you can charge in Bitcoin for services that solve these problems and then you can payout in Bitcoin. So you earn, save, spend with Bitcoin and you can basically start businesses to solve problems”
He also stated that the problems can be solved with the help of smart contracts on Bitcoin. This was followed by Charles stating Bitcoin has a built in smart contract language that allows people to create any type of contract which is related to solving problems with Bitcoin. Charles added that the limited supply of the coin allows it to be sound money and that on-chain scaling is going to add on to its global adoption.
The CEO further elucidated on this concept in theory by speaking about the Bitcoin transaction confirmation, stating that it takes almost 10 minutes for the confirmation of a transaction. He added that currently Bitcoin SV apps relies on zero-configuration, wherein “you just sort of trust that it will confirm”. Charles stated that there is a possibility that this can be exploited, and that in many cases people can double spend if the transactions have not been confirmed.
He continued to say:
“First of all if the double spends don’t usually happen, then it’s just a business question of do the benefits outweigh the costs. If there’s a little bit of fraud, so long as that fraud isn’t overly expensive and you’re earning more money than you’re losing and fraud. It’s acceptable, although you certainly want to minimize fraud”
Charles stated that fraud can be minimized by analyzing the network and the people sending money and this information can be accumulated into a Bayesian probability theory calculation wherein the probability of fraud can be computed. He added that if that probability is low after a certain duration, then it can be accepted.
He went on to say:
“You can also provide insurance so you can guarantee an instant transaction and then basically the insurance company takes the cost of fraud on and so that way the merchant always has reliable transactions and they don’t have to worry about fraud ever but then they have to pay the cost of insurance.”
This was followed by Charles stating that this was one of the options to solve instant transactions using Bitcoin without changing the protocol.
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