It’s true that everyone can’t have their own UTXOs. However everyone could hold their own keys if we adopt densification measures (such as the various covenant proposals). Even then though, it’s infeasible to have everyone using their own keys to do L1 daily transactions. Fortunately, shared UTXOs offer L2 scaling. Lightning is one example. We must protect #Bitcoin decentralization. We do this by densifying to make ever more efficient use of precious block space.

💯 I've been barking about tx density improvements as well. It also helps crowd out spam like runes/brc20

I will. But I’ll just quickly reply that flying was also impossible. So was talking with a person on the other side of the planet while looking in their eyes. Just something to think about

People report this as if it is a bad thing. I would take a US$ backed by gold over what we have today. It’d still be fractional reserve dollars held in a bank but it would be grounded to reality. An unbacked currency is the problem we need to solve for. Bitcoin ties value to the real world: Time and electricity. If future generations want more sovereignty, let them fight for ground. The tools get better all the time, but the tools demand a stable foundation. Bitcoin is that foundation. Do not fuck with it.

You are hitting at the core of the issue. If you do the math with how people use bitcoin today, you’ll get one answer; but if you do the math with how people could use bitcoin today, you’ll get maybe 1.5-2.2x that answer (eg, many users creating multi-input multi-output transaction with only one aggregated schnorr signature hitting the chain). In an ideal world though, this gets maybe 1M transactions per day max. If you look at L2’s, you’ll get maybe 100-1000x the answer above (random guess, tbh)…but a lot depends on how people use those L2’s. If you look at how I’ve tried lighting, it’s like only a 2x improvement…because keeping a lightning node running isn’t trivially easy. And one can argue this isn’t truly sovereign, just more sovereign than status quo money. And getting to this hypothetical 100-1000x requires time…the 1000x will require 10x longer than the 100x improvement. One could argue the improvement is unbounded, but imho, lightning channels and liquid peg-ins won’t have infinite lifespans. Then there is a weird category of utxo sharing where the transaction signature somehow communicates what percentage of the utxo is available to the user. I can’t ballpark the efficiency gain here, it might be no improvement on a per spending transaction basis…but could be really big improvement in terms of allowing one output to be owned by 10 or maybe 100 people. But AFAICT, we are far far away from letting 1B people use the chain once a day.

So about 250k sats per person now if evenly divided. The ‘everyone should have a utxo’ story, idk how that will happen.. Atm it coast more than 10k sats to tx on-chain depending the timing.. 4% of “my life savings” to buy coffee. Quick search online said the amount of banks worldwide is "25 000. But sources differ significantly." If we spin on that taught with doing the numbers; and there are more than 25.000 people who hold a whole btc (probably more toward 100.000 plebs or million idk) and in decades from now having a utxo with 0,1 btc would probably make you financially well-off. Entrepreneurs with a nice bag of btc who have ambitions to build and invest on whatever is possible on the layers in time to come.. As in the podcast “1000x better than what we have now with fiat banks”.. Lets say we have double the amount of btc-custodians, compared to our current banks number, in the centuries to come who offer to store ones btc, and if they fail they die out quick, many others to choose from, so intensive is to be damn good at what you offer. So in time and having patience,, let the mysteries of the universe unfold 🌌

Absolutely agree. Once governments are starved of fiat and forced to go on a Bitcoin standard, their reign of tyranny will greatly diminish. The need for true self sovereignty will diminish when the power to enslave your own citizens is taken away.

You are collating two things 1. Everyone can own their own UTXO 2. Use it for everyday transactions 1 is important, 2 is not. Most people should use e-cash for everyday use. A UTXO would be used in a similar fashion to moving money into a high interest term deposit - where you hold the majority of your money but only make a transaction once a month to once every few years, depending how wealthy you are. A lightning channel to the eCash would allow the balance that's held by the custodian to be minimal. If a transaction fee exceeds the $10 -100 range even this breaks down.

Agreed with the L1 considerations. As you say, anyone who have done the calculations know that a decentralized money cannot provide L1 transactions for 8 billion people. Magical thinking have zero impact on reality. Any scaling solution that aims at giving 8 billion people access to Bitcoin must involve a free market of L2-L3 options. The Bitcoin base layer is the proper foundation for healthy free market competition, which in turn brings high degrees of security via game theory. I would say that there are degrees of self custody. Moving sats away from exchanges, who are government controlled, is a primary aspect of self custody. For significant amounts, custody involving L1 is ideal. For smaller amounts, an archipelago of options competing via game theory is far better than anything we have had before. Unserious and captured options will lose trust and users in benefit of the serious and non-captured options. LN operators are decentralized and sovereign banks, unimpacted by borders since Bitcoin is global and without borders.

Here's my math involving 8 billion people: If we assume 7000 tx's per block, then the 144 daily blocks gives 1 million transactions. Most blocks will have less than 7k tx's, but let's go with this high tx figure for now just to explore the math. If we divide 8 billion people by 365 million tx's per year, we arrive at almost 22 years per tx in terms of bandwidth, which impacts the tx fees. Granted, a certain percentage of the world's population are children who will not need to spend from a savings UTXO on L1. Then there may be a certain percentage that don't use Bitcoin at all. Finally there are hodlers that have a 5, 10 or 15 years horizon for their savings. If I am optimistic, 1 L1 tx every 10 years should be affordable for most people, so that leaves L1 as primarily a savings layer, while L2-L3 offers cash functions via decentralized banks/nodes.