This is the second major disruption of the system in 2019, following a three-hour downtime period of the FedWire interbank transfer service in April 1. The Fed did not disclose specific causes for both outages, pointing to a generic “internal technical issue” earlier.
Bitcoin Does Not Solve This
Though this news has been considered by some as a testament to Bitcoin’s resilience, Mati Greenspan, Founder at QuantumEconomics, stated that the network ultimately wouldn’t be able to handle such a transaction volume without grinding to a halt.
Relax moonbois and gurls. Bitcoin does not fix this.
58 million transactions a day would flood the blockchain.https://t.co/Q024w4YeWH
— Mati Greenspan [not trading advice] (@MatiGreenspan) December 19, 2019
Under heavily optimized conditions, the Bitcoin network can handle at most 27 transactions per second. A frequently cited average value is seven transactions per second.
Using the 2018 figures for the ACH system, it processed an average of 677 transactions per second. No major cryptocurrency has been able to come close to this figure, though many projects often claim to be able to process thousands of transactions per second.
Finally, though the Bitcoin network technically never experienced outages, the situation around Dec. 2017 was, in fact, an outage in all but name.
Bitcoin mempool size. Source: Johoe’s Mempool Statistics
At one point during the height of crypto euphoria, there were over 250,000 unconfirmed transactions. Sending Bitcoins was only possible by setting a $50 fee. Users who set a fee below $10 had to wait about three weeks for their payment to be cleared — effectively equivalent to a serious localized outage.
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