> Personal opinion: I think the part you are missing here is that lots of transactions shouldn't be occurring on the base layer. Remember that every transaction that occurs is stored in perpetuity on every node in the Bitcoin network. It should be expensive for a transaction like that to occur, and we should create incentives that limit the creation of these as much as possible.
Serious question because this is something I have had trouble figuring out.
Why should transactions not be on the base layer? Isn't the whole point that the ledger is fully decentralized? How does pushing transactions into side channels (lightning, eth's layer 2) not end up centralizing transaction validation (they might not be completely centralized, but they seem by definition less centralized than the bitcoin base network)?
Because "every transaction that occurs is stored in perpetuity on every node in the Bitcoin network" means there is naturally a scaling cap. Bitcoin's lightning network doesn't really centralize transaction validation in the way I think you're thinking - it simply allows 2 counterparties to spend money between each other in a way that doesn't have to be finalized on the Bitcoin layer 1 network after every change, but can be if either party tries to cheat or steal from the other. And then the "network" part of lightning allows either party to spend funds to anyone else in the network with these same guarantees.
Serious question because this is something I have had trouble figuring out.
Why should transactions not be on the base layer? Isn't the whole point that the ledger is fully decentralized? How does pushing transactions into side channels (lightning, eth's layer 2) not end up centralizing transaction validation (they might not be completely centralized, but they seem by definition less centralized than the bitcoin base network)?