While Bitcoin (BTC) facilitates far fewer transactions per second than altcoins, one BTC proponent says the important consideration is the value transfer happening per second (VTPS) and not the nominal transaction throughput (transactions per second — TPS).
Bitcoin continues to cement its position not only as a store of value (SoV) asset but also as a means for permissionless cross-border money transfer. The latter attribute has seen the largest crypto by market capitalization become a viable alternative to the slow legacy wire transfer architecture.
Bitcoin Moves Nearly $500K Per Second Around the World
Blockstream CEO Samson Mow is not having it with Bitcoin (BTC) critics quick to point out the cryptocurrency’s inferior transaction throughput capacity.
Tweeting on Dec. 2, Mow highlighted Bitcoin’s superiority in terms of actual value transacted per second, adding:
Bitcoin moves nearly half a million dollars in value around the globe permissionlessly every second. It was never about transactions per second and coffee. It’s all about value transacted per second and a new financial paradigm.
Thus, while altcoins might have higher transaction throughput capacities, Bitcoin’s overwhelming adoption against the rest of the crypto space means more value transactions occur on its chain than on other blockchains.
Value Over Speed
Detractors of Bitcoin’s low TPS say the crypto is a poor choice for high-frequency microtransactions. These critics point to legacy payment rails like Visa that claim speeds in the order of 24,000 TPS.
However, high throughput and speed often come at the sacrificial altar of decentralization. Altcoins that claim higher TPS tend to operate at a lower decentralization matrix than Bitcoin with far fewer network validators.
It’s important to note that Mow’s characterization of Bitcoin’s VTPS being higher than altcoins including Ethereum’s (ETH) relies on actual native currency transactions only. As previously reported by BeInCrypto, Ethereum value transactions now outstrip Bitcoin two-to-one.
Indeed, the second-largest blockchain by market capitalization is on course to facilitate $1 trillion in transactions for 2020. Ethereum’s large-value transfer figure is based on the massive spike in stablecoin activity as well as the DeFi boom of 2020.