You can transport value across the world instantly, with no intermediaries. This is a major efficiency gain.
With the Lightning Network, you could transport any amount of value, instantly, for very close to zero cost, allowing things like paying a random untrusted party for WiFi by the second, with incremental micropayments.
> You can transport value across the world instantly, with no intermediaries. This is a major efficiency gain.
Only in a fictional world where my employer/clients pay me in bitcoin.
In reality I need to go to an exchange, convert to bitcoin, then go back to either the same exchange or a different exchange and convert from bitcoin, all in all I've gone through two intermediaries and paid two fees.
For one example if I did that on CoinMill they would charge me $2.59 over market for 1 bitcoin ($252~254 in value) and the same again when I convert it back to dollars. $5.18, that's approx. a 2% transaction fee. TransferWise by contrast (who really are super hassle free) charge $2.88 for one end-to-end transaction, so less than bitcoin(!).
So yeah, your argument is completely broken in the real world. Only in a fictional world where everyone uses bitcoin does it work.
>In reality I need to go to an exchange, convert to bitcoin, then go back to either the same exchange or a different exchange and convert from bitcoin, all in all I've gone through two intermediaries and paid two fees.
The intermediaries are domestic exchanges in this case, meaning only domestic transfers of fiat need to be made. The international transfer occurs through Bitcoin. Fees for large Bitcoin exchanges range from 0.25% (Bitstamp) to 0.38% (BTCChina). Coinbase currently has no fees, but it's a temporary promotion. That means it's less than 0.8% in trading fees altogether, when using major exchanges. Assuming Bitcoin becomes a little more widely adopted, this situation will only get better.
I think the real opportunity is in the back end of the financial system. Banks can begin to use Bitcoin for international wire transfers, while enjoying much lower trading fees than retail clients when converting into and out of fiat currencies.
I think you are unfairly generalising from your personal use-case. Efficiency can also mean "time" or "being able to do it at all".
There's scenarios where TransferWise, MoneyGram, WesternUnion etc. either don't work or ask for extremely high fees.
It can also be simply inconvenient to go to the physical pick up locations of MG/WU. Keep in mind most people in the world are not blessed with 3 different banks and a starbucks within walking distance.
Do you have an idea of the quantity of power Chinese bitcoin mining farms consume? That's only for the few transactions that the networks processes right now.
Here is a quick computation that shows that every transaction that goes through the Bitcoin network is equivalent to releasing 47kg of CO2 into the atmosphere: http://redd.it/2hiea4.
>Do you have an idea of the quantity of power Chinese bitcoin mining farms consume? That's only for the few transactions that the networks processes right now.
Other than the accelerating effect of transaction fees on mining resource consumption, which is on the order of 2 cents per tx, there is no relationship between number of transactions that the network processes and the power Bitcoin miners consume. In other words, the cost (both economic and environmental) per transaction will decline as transaction volumes increase.
There is a direct relation between the volume of transactions and the amount of miners needed to process them, and therefore a relation between the transactions and the consumed power (with a few more factors, such as ASIC efficiency).
The current Bitcoin network cannot handle that many (think an order of magnitude) more transactions without having to scale. See also the original link.
>There is a direct relation between the volume of transactions and the amount of miners needed to process them,
Almost the entire cost of mining is in running ASICs to produce proof of work, not in validating transactions. The cost to produce proof of work is not affected by number of transactions.
With the Lightning Network, you could transport any amount of value, instantly, for very close to zero cost, allowing things like paying a random untrusted party for WiFi by the second, with incremental micropayments.