42 sats \ 0 replies \ @btcschellingpnt 12 Nov 2023 \ on: Does increasing the divisibility of Bitcoin require a soft fork? bitcoin
There's two parts to this really:
- Depends where and how that divisibility was implemented, AND
- Understand why additional divisibility could/would be needed
First - how and where:
On a layer above the base layer of Bitcoin - such as Lightning - divisibility beyond 1sat is already in place. Divisibility down to the milli-sat (1/1000th) is already part of that protocol.
On a layer above the second layers (like Lightning), additional divisibility could be implemented - think of further divisibility within a L3 such as Fedi/Cashu.
Now let's talk about why:
As more value is ascribed to Bitcoin, the fiat-equivalent pricing goes up. At $1m bitcoin, each satoshi is therefore worth 1cent. This means at $1m bitcoin, we have the same divisibility that we have today in the dollar system. All good.
But, as Laura knows, the accrual of value into Bitcoin won't stop there; in fact, it will accelerate. So further out (dollar system most likely long in the rear-view mirror), at $100m bitcoin, each satoshi is worth 1 dollar. Ignoring the aspects of purchasing power parity, at this time, further divisibility may be required .. and good news .. we already have that in Lightning.
Hope that helps your thinking