There is a lot of misinformation in the distributed ledger space and, in general, I feel that many people are having a hard time getting to the truth. I hope that this article gives people a better sense of the value of distributed ledger technologies, why we chose Bitcoin SV and how solvable all the so-called technical challenges really are. This article is meant to be a high-level overview which should point you in the right direction for further inquiry.

The Tokenized Protocol is designed for the Bitcoin SV network (BSV) and it is also the only network that will be supported by our company's products and services.

We believe that Bitcoin SV can provide immense value to individuals, organizations and governments around the world in its use as a general-purpose commodity ledger. A core element of the value proposition of Tokenized is that businesses who build extensively on the platform can do so without being exposed to the volatility of Bitcoin. It is Bitcoin's value as a commodity ledger that our company aims to unlock for our customers.

The Commodity Ledger

Bitcoin can be considered a cloud database which can be used in place of a managed service provided by the likes of Amazon Web Services or Google Cloud. The function of this database is as an immutable ledger that can be used to record, timestamp, and store all kinds of data in addition to the ownership and transfer of bitcoin. Once records are confirmed into blocks (discrete units that make up the blockchain), then they are stored in the blockchain forever and the data can never be altered.

While some cloud database services operate as an immutable ledger, they require trusting a centralized entity, which makes the integrity of the ledger's records subject to influence from political or commercial entities. It is possible that governments or companies will not recognize the legitimacy of an 'immutable ledger' that is owned and operated by a business located in an 'unfriendly' jurisdiction, especially when it comes to recording financial or legal documents and events. This is why any ledger used as a source of truth for commerce on a global scale, must be immune to influence from even powerful nation states. The only practical way to provide this is with a decentralized network, which is what Bitcoin SV provides.

To use the ledger for commodity data storage, users pay network fees on a pro-rata basis. The larger the amount of data being stored, the more it costs. However, in stark contrast to legacy storage solutions, data is purchased on a per-byte basis as it is used. There is no user agreement and no account or pre-payment required. All that is needed is a small amount of bitcoin to pay the network fees. Bitcoin miners are agnostic to the data they process and store. Space in each Bitcoin block is treated as a commodity and as long as the transaction has enough bitcoin to pay for the processing and storage fees, then it will be accepted and included in the block.

Why Bitcoin SV?

The Bitcoin SV network uses the original Bitcoin protocol as defined by the Bitcoin white paper and aims to achieve on-chain scaling in-line with Satoshi Nakamoto's original vision. It is important to note that the Bitcoin protocol is defined by how it operates as a system, encompassing economic incentives as well as technical solutions.

At Tokenized, we firmly believe that the Bitcoin SV network is the only network capable of providing a viable environment for the Tokenized Protocol to grow and flourish. We came to this conclusion after a very careful analysis of all the available distributed ledger technologies and we present the broad strokes of our conclusions below. The team at Tokenized are available to discuss these choices in detail in our community forum at

The goal of our analysis was simply to match our requirements, both current and projected, with the technology's capabilities. Our vision is to build the backbone of a new global network for commerce in which all commercial, financial and legal transactions/records are stored. To fulfil that vision, we require a technology that is capable of providing a global, public, immutable, reliable, and uncensorable ledger that performs better than current banking and financial networks. We identified five key areas of focus for the analysis: security, utility, reliability, scalability, and cost.


Bitcoin SV is secured with proof-of-work and proven cryptographic algorithms.

Bitcoin's technological underpinnings have now been 'battle-tested' for ~10 years with an effective 'bug bounty' in the billions for the last 5 years. No serious issues have been discovered yet.

Bitcoin, at its core, is a carefully designed system of incentives whereby the actors (miners and users) involved in the ecosystem are all highly incentivized to invest their time and money into using, maintaining, and improving the network. The overarching incentive for miners is to make Bitcoin a success over the long-term and this is the essence of why proof-of-work works to secure the network and why economics matters in security. Miners who have a lot of hash power and therefore the ability to pervert the integrity of the network, are heavily disincentivized to do so, because they would lose huge amounts of money. Miners with this type of power have invested a lot (in the hundreds of millions of dollars) in their capital equipment and often have long-term utility contracts. If the Bitcoin SV network is shown to be corrupt, then the value of Bitcoin would drop and their investment would suddenly become worthless.


The Bitcoin SV network employs the ideal architecture for a distributed ledger. It is highly efficient at distributing and recording data to the 'ledger', and uses a simple but expressive scripting system which is computationally efficient and remains 'bare-bones' for simple transactions. The fact that the nodes are only interested in the core features that allow for the basic operation of the Bitcoin protocol, means that nodes are only burdened with processing of essential scripts associated with the ownership and transfer of bitcoins. All other data is effectively ignored by the nodes.

Bitcoin SV also allows users to store any kind of data, currently supporting up to 100kB per transaction with eventual support for transactions that store up to 4GB of arbitrary data. This capability is what Tokenized uses for recording token and smart contract metadata.

Bitcoin's proof-of-work system incentivizes miners to improve their connectivity to the network, driving the network to the natural formation of a highly connected small world network where powerful nodes in the system are able to be reached by any user at any time. These miners compete to get their blocks to all other nodes on the network, with the most efficient and effective nodes achieving the most profitable outcomes. Because the profitability of miners is directly tied to the technological fitness of their infrastructure, the incentive structure of the network encourages constant improvement in performance. This drives progress and ensures that scaling outcomes can be achieved.

The current state of the network and protocol allows for highly reliable instant transactions. This means that transactions can be confirmed to be valid and accepted by the network within ~2 seconds. This allows for ultra-fast settlement and clearing of transactions.


The Bitcoin SV network is a decentralized network which makes it very reliable as it has a lot of redundancy. If a node goes down there are always many other nodes (hundreds or thousands) operated by other entities that are there as back-up. Nodes are also distributed around the world geographically and politically, and are therefore extremely resistant to natural and political risks. Since, 2013 the Bitcoin network has operated with 100% uptime. This is exceptional reliability, and the Bitcoin SV network has all of the ingredients necessary for ensuring that the network continues to operate for decades to come with the same unprecedented reliability.


The Bitcoin SV network effectively has no scaling limit. The original Bitcoin protocol, with all the important capacity limits removed, is highly parallelizable. Computational critical paths (block template creation and block validation) can accommodate demands for increased throughput by increasing the number of cores used for processing. This means that as transactional throughput increases, the mining nodes that make up the infrastructure of the Bitcoin network will start to use high performance computer clusters comprised of hundreds and potentially even thousands of processing cores, 10 or hundreds of terabytes of shared virtual memory, and high-throughput low-latency networking solutions (eg. InfiniBand) to allow for millions of transactions per second.

As the transactional throughput goes up, the network's bandwidth demands can easily be accommodated by adding more 'pipes' (fiber optic cables) to the network in a parallel manner. High-performance networking hardware has been shown to push incredible amounts of data through standard fiber optic cables over long distances and in real world scenarios. For example, in 2016, 8 terabytes per second over a single fibre measuring 4,100 miles (6,600km) was achieved in an undersea cable by Nokia-Alcatel-Lucent. (Source: Large blocks require large amounts of storage, but the cost of storage is already extremely cheap, and all storage demands can be accommodated easily by adding more storage capacity in parallel. Since network fees are charged on a per-byte basis, all extra space required will be paid for by the users.

The Bitcoin SV mining industry is already testing and gearing up for terabyte blocks and beyond. For reference, terabyte blocks equate to roughly 4 million transactions per second. They have already demonstrated scalability through the successful mining of 128MB blocks on the main network, and have successfully mined 36 hours of continuous 128MB blocks with 700 transactions per second on the test net. These early tests show that Bitcoin SV is well on its way to scaling to serve the entire world. You can follow the scaling progress on the BSV Scaling Test Network here:

Considering all of these factors, it is fairly obvious that scaling Bitcoin will be a predictable engineering challenge that will be easily able to keep up with user demand such that eventually every single person in the world will be able to have every financial transaction recorded to it, and much, much more.


For a proper decentralized network, the Bitcoin SV network is the most affordable. The average transaction fees have hovered in the sub-cent (~$0.002 USD/txn) range for most of its existence. There has also been a firm commitment from the major mining companies that support Bitcoin SV to continue to offer ultra-low fees with the stated goal of building a long-term sustainable business on massive transactional throughput at ultra-low costs. Transactional throughput resulting in gigabyte and terabyte blocks will yield significant revenues for the mining industry, even at transaction fees much lower than the current average.

-James Belding