Bitcoin took the $24,000 level today. As a result, the cryptocurrency rose in value by as much as 23 percent during the week.

A 15-minute chart of the Bitcoin exchange rate

All this is accompanied by an increase in the number of investors who are putting money into the first coin. In particular, the number of addresses with at least 0.1 BTC in them set a record today. According to Glassnode analysts, the figure has reached 3,728,339 units. Consequently, the number of relatively small investors is growing.

Number of addresses with at least 0.1 BTC

Be that as it may, experts are not particularly happy with the prospects of BTC as a means of payment.

Can anything be bought with Bitcoin?

According to Bitcoin.com cryptocurrency wallet developer Corbin Fraser, Bitcoin has lost its purpose as a peer-to-peer (P2P) payment network. This is because since 2016, the cryptocurrency community itself has been actively insisting that BTC should not be used for payments. Here is an expert’s rejoinder in which he shares his perspective on what’s happening with BTC.

Remittances and P2P payments are mostly conducted on other blockchains with higher bandwidth and lower fees. Bitcoin will find it difficult to re-conquer this sphere.

In other words, in recent years users have had a huge number of alternative coins that are much faster and cheaper than Bitcoin. That is, it is possible to make almost instant transactions in Solana, Avalanche or Cardano with around zero fees. The demand for paying for goods or services in BTC would then be predictably low.

Bitcoin’s throughput compared to different altcoins. The indicator is transactions per second

To illustrate, we show a graph of the average Bitcoin network fee over the last six months. Naturally, an average of $1.5-2 per transaction is expensive. For example, in our familiar Solana network SOL costs a hundredth of a penny. And the transaction takes only seconds.

Graph of the average Bitcoin fee over the past six months

According to Cointelegraph’s sources, Bitcoin’s payment position is also worsened by the complexity of using second-tier solutions like the Lightning Network.

Note that in order to use the Lightning network, users need to open channels with the people with whom they plan to interact - and that, too, requires a fee. In addition, in order to gain access to the coins, the channel must be closed, which also requires effort.

Consequently, regular users need to be knowledgeable in basic cryptocurrency concepts – why spend time on all that when you can transfer funds in altcoin? The experts continue.

Over the past two years, competition among low-commission, high-bandwidth blockchains has increased significantly. Bitcoin is getting on its heels when it comes to shifting the focus back to using it for everyday payments.

But even if somehow “magically” BTC is once again at its peak of popularity for everyday payments, the main cryptocurrency’s network will be overwhelmed. Bitcoin’s throughput is only a few transactions per second, while the same figure for popular altcoins reaches values of thousands of transactions per second. In other words, a purely technical limitation is also important.

Comparing the throughput of different blockchains

Trust Machines CEO and co-founder Muneb Ali said that second-tier payment solutions will still evolve around Bitcoin.

This is what we see in other blockchains, and what we can expect from Bitcoin.

Despite the major cryptocurrency’s more than a decade history, we are still in the early stages of developing its ecosystem. This is because building all sorts of applications and platforms specifically based on the BTC blockchain traditionally requires a time-consuming development process.

Bitcoin exchange rate

However, Bitcoin will still find its consumers in the payments market. It may be large firms that need to conduct large volumes of borderless transactions with a reliable asset, and Bitcoin, because of the abundance of miners, is just that. Note, that we are talking about high frequency of payments, you can spend BTCs for real goods and services quite successfully for a long time. Moreover, Bitcoin is already fully legal in one country in the world – El Salvador.

The power of Bitcoin


We think that the criticism of Bitcoin in this context is really relevant, because the cryptocurrency's network is capable of conducting about 5-7 transactions per second. Naturally, this is not enough to use the cryptocurrency's core network as a global means of payment. Of course, there is an add-on in the form of Lightning network, but Solana is much easier to use - especially because of its convenient Phantom-like wallets. That said, the idea of storing capital in BTC without actively moving it seems adequate to us.