Bitcoin and Lightning Network. The true one world currency?

Bitcoin can handle roughly 160 million transaction per year. Everyone knowing some math can easily calculate that this number is quite low to call it a one world currency. In comparison Visa handles about the same amount in transactions daily!

The solution the Bitcoin community came up with to tackle this problem is called the Lightning Network. This article does not describe the Lightning Network, I will go into more details about Lightning in another article. But you need to know that there external accounts aside of the Bitcoin main network which you need to fund in order to transact within the Lighnting Network. In the best case you would only need to fund one channel, but even that is quite problem in Bitcoins current state.

So the fact that they decided to completely focus on scaling the network by using Lightning is the source of the problem.

There are 8 billion people currently and the current growth rate is about 1%, so each year there are 80 Million more people. You surely already noted only half of the existing population will be able to fund their channel if every new person gets their channel fund only once during their lifetime. To let the existing population of 8 billion humans at least fund their Lightning Network channels at a rate of 80 Million people per year shows it will take over 100 years to finish for them. You see this is mathematicaly impossible, you may wait for your funding to settle until you are dead.

Using only channel may lead to centralization which lead to a monopol in controlling the transaction fees.

You may never really own your Bitcoin! Looking at the problems mentioned above it is quite obvious that businesses will pop offering already filled up bitcoin channels. The problem is you may never know if you are really on a Lightning Network channel or just a centrally organized I owe you scheme. In other words a central bank, right, exactly the same Bitcoin was built to avoid against.

But it goes further: Bitcoin needs to function and looked at like an economy since miners are needed to keep the Bitcoin main network safe. These miners need to make profit. Their profit currently is mainly based upon the block rewards. But these block rewards will be constantly lowered. The initial plan was to scale onchain (at best indefinitely) so that the income for the miners still keep constantly growing since their costs to secure network will also constantly grow. But stopping onchain scaling is sentencing miners to death. To compensate for their growing costs they will need to constantly raise the transaction fees. So at a certain point the network will collapse. It may be due to miners not being able to compensate for their costs or users of the network not being able to transact due to the high transaction fees.