#FF00AA

If you’ve ever listened to a Bitcoin aficionado and wondered how a distributed currency could realistically handle the traffic involved in actually becoming the global player they thought it would, well…

The problem was that, early on, Satoshi established a limit on the number of transactions that could be processed by the network every 10 minutes. The cap was meant to ensure that the computers supporting the network, and processing the transactions, would not be overwhelmed by an enormous quantity of data. But Satoshi had suggested that the limit should be temporary, and as the number of transactions coursing through the network inched closer to the cap, delays started to occur and transactions were not going through.

When Mr. Hearn began pushing for changes to the core Bitcoin software to allow for larger blocks of transaction data, he faced immediate resistance. Gregory Maxwell, a largely self-taught programmer who had worked on Wikipedia and the Mozilla web browser, both open-source projects, said that larger blocks of transaction data would be harder for ordinary computers to process. The result, Mr. Maxwell warned, would be to hand control over the network to big companies that could afford powerful computers. […]

Mr. Hearn retorted that the technical issue wasn’t such a big deal; ordinary computers could mostly process the larger blocks of transaction data. More important, he argued, was that Bitcoin needed to succeed first as a cheaper, faster payment network, like PayPal or Visa. If Bitcoin wanted to ever compete with mainstream payment systems, which could process tens of thousands of transactions a second, it would have to do away with Bitcoin’s existing limit of fewer than seven transactions a second.

Yeah, that’s a big jump.