Picture this! It is some time in the not-too-distant future and humans managed to colonize Mars.
The first settlers on the red planet get paid handsomely to build infrastructure and working systems to support more migration.
The Martian economy is still young, but the early settlers still need to support their families back on Earth and thus Bitcoin becomes the first interplanetary currency.
While this has the makings of a science fiction tale, it is within the realm of possibility, according to a recently published research paper.
Tesla CEO Elon Musk introduced the idea of colonizing Mars and making humans a multi-planetary species not so long ago.
Bitcoin as an interplanetary currency means it would be used to facilitate transactions across both planets.
An impressive scale and certainly one that would mark the height of human economic achievement.
While this sounds like a walk in the park on paper, some major challenges arise right off the bat.
For example, the great distances between the two planets present a latency challenge that would introduce inefficiency into the current Bitcoin transaction validation system.
Under normal circumstances, transaction finality would be a challenge even for Bitcoin. This is because the large distance would take too much time to finalize.
This latency would likely disrupt the Bitcoin blockchain’s transaction finality.
Researchers Propose a Bitcoin Interplanetary Standard with Proof of Transit Timestamping
Jose E. Puente and Carlos Puente recently published a paper detailing a revolutionary new idea that could make an interplanetary Bitcoin a reality.
A key component of their idea was a revolutionary cryptographic receipt system which they called Proof-of-Transit Timestamping (PoTT).
The PoTT proposes nodes could exist as satellites along the way, and these would stamp digital receipts on the data as it traverses the distances.
This approach would be ideal for dispute resolution. The research paper proposed a new type of internet dubbed Delay/Disruption-Tolerant Networking (DTN).
An internet designed to handle dropped connections and long delays. The authors also proposed the creation of new smart payment timers on account of the higher latency.
One of the most interesting thing about the research paper was that it did not propose changes to the main network.
Instead, they aimed to circumvent the challenges presented by the vast distances by implementing tools to make Bitcoin transfers workable.
The proposal could lead to the creation of sidechains for the blockchain network. It is worth noting that other blockchains, including Ethereum have explored sidechains.
This approach has historically been explored to ease the load on the main-chain to achieve more efficiency.
Why This Research Could be a Game-Changer
The research underscores Bitcoin’s potential as hard money. You may have seen some SciFi films where space travelers get paid in credits or some currency transferred digitally.
The fact that humans have had the technology that could enable finance even at the cosmic level does underscore the important role that Bitcoin could play in the future of humanity.
Especially if that future will involve humans reaching higher for the stars. The reality is that it will take a while for the idea of colonizing Mars to become a reality.
It could even take decades or centuries just to get the first human settlements there.
However, that there can exist solutions to solve future problems, such as interplanetary currencies, certainly makes for an interesting argument.