Which is pretty much all the time now.  I don't think the memory pool has gone to zero for a second block in the last week or so.

For example there are 3,000 unconfirmed tx right now:
http://blockchain.info/unconfirmed-transactions

This might be an interesting thing for blockchain.info to start graphing.  The number of unconfirmed (maybe all, no fee, fee) tx over time.

I am fairly certain that is no longer in the rules.  Miners are free to include whatever tx they wish at whatever fee threshold.
0.8.2 (and prior versions) simplified the fee structure a lot.

Today the min* fee to be relayed is:
0 BTC for high priority tx
0.0001 BTC for low priority txs

* Note this the in the min fee to be relayed.  Tx compete for block space so paying unpaid high priority tx may (and likely won't) be included in the next block.  I just pay 0.0001 BTC on all txs high priority or low and sometimes bump that up to 0.001 BTC for an "urgent" tx (like sending 500 BTC to an exchange for liquidation).  I would say 90%+ of my tx are included in the next block.  Now if MtGox would just join the 21st century and reduce their confirmation requirement to 3 confirms.

two possibilities.

a) a larger miner (think major pool) is scared of producing blocks larger than 250KB due to increased chance of orphans on larger blocks.
b) there aren't that many paying transactions.  miner have increasingly less reason to expand block sizes to include large swaths of free transactions.  Yet many users (likely being sold "Bitcoin is free" nonsense) insist on never including a tx fee.

On the second point let me share an antecdote.  Had a customer who absolutely needed a wire received that day and the bad news is it was already 3PM EST when he sent the transaction.  He paid us $20 wire fee (plus accepting a lower exchange rate).  Now we will lock in an exchange rate at 0-confirms but won't send funds until 3-confirms (6-confirms is just overkill for 99.9% of tx out there BTW).  I think you already know where this is going.  To save a quarter penny the client opted to not include a tx fee.  His order didn't confirm until after the wire deadline had passed, worse it was on a Friday. So he saved a quarter penny and got his cash three days later.

Would be interesting to do some stats which take a look at when a block is produced how much of the "excluded" memory pool was paying tx, average fee, how many unpaid low priority, how many unpaid high priority, etc.

A lessons learned list to make a technically superior bitcoin.  The reason for Bitcoin's potential future failure can be added to that list too.

Then you should mine and make 90,000% annual profit.  Except the cost to mine is much much much higher than $2 to $4 per BTC.  Care to show your "math" (and I use the term lightly) on how the production cost (which is irrelevant to the exchange rate of a currency) is $2 to $4.

Nope.  You couldn't do that with 51% (or any amount) of hashing power.  You can't change Bitcoin in that manner you can only fork it.  Users can continue to use the "current" Bitcoin and the miners that remains will get a larger share of the reward.  Try learning about how Bitcoin works before declaring it dead.  The Bitcoin as it exists today (21M BTC, irreversible, psuedo-anonymous, divisibility to 8 decimal places, 10 minute blocks, 50 block reward halving every 210,000 blocks) will ALWAYS exist as long as at least two nodes are using it and at least one node is mining.

Thanks.  Just sold 500 BTC at market.  I will sell the rest once I get access to my cold wallet (damn my excessive security measures).  Thank you for pointing out the facts* nobody but you could see.  The firm (and baseless) prediction of $2-$4 is what convinced me.


*By "facts" I mean mindless rambling.  Hint: miners have no control over the rate of generation, the exchange rate or the velocity of the bitcoin economy (which is comparably high).

Yes there are ways to optimize traffic however they aren't implemented yet so TODAY those limits hold.  Also transmitting a hash (64 bytes) vs transmitting a tx (~400 bytes on average) while smaller isn't an order of magnitude smaller.  So take whatever realistic limit exists based on available resources and even hyper optimized the same limit still exists at 5x that transaction limit.

Don't get hung up on the details.  The point is as tx volume increases bandwidth is the tightest bottleneck.  As nodes can't or won't handle that the number of full nodes will decline.  Higher transaction volume when it breaches what is "reasonable" (and yes there is some gray area on what is reasonable) to the average node will result in a centralization as a result of the costs to run a full node.  Optimizations help but you can't get blood from a stone.   Nobody is going to be able to run a full node on the AVERAGE residential connection with a transaction speed of say 5,000 tps.


There are far more bitcoin nodes today than banks in Panama.  Regulation or not when the burden on a node rises there will be less nodes.  That is a form of centralization.  An open unlimited network "may" reach a good compromise or it may not and this is a billion dollar project.  Their are no "oops" guess it didn't lets hit the reset button.  Given that expanding Bitcoin is somewhat like conducting maintenance on an aircraft in flight it might be worthwhile to move cautiously.   

The fee is 0.0001 per KB on low priority txs.  Your tx is over 1KB so the min fee would be 0.0002 not sure why your client didn't calculate it correctly.

Can you do it? Sure.  Can you do it securely?  Probably not.  The ugly part is it likely will work for some time until a dedicated attacker tries to exploit your paper thin security and then when it fails it (and given enough time it will), it will fail hard and cost either you or someone who relied on your a massive amount of funds.

Without at least the blockheaders your node has no way of knowing what other nodes are telling you is truthful.  How long do you think it would take a single GPU computer to generate 6 (or 60) blocks of fake history at difficulty 1?  If all your node does is ask for 6 most recent blocks ... ok here are 6 blocks I made for you and see your massive payment of 500 BTC is there, so please send me the gold/wire transfer/computer hardware I asked for.  Only later do you find out that you were fed a false history.  Yes I have 500 BTC but in the "real" blockchain I sent them to myself not you.  A double spent that you could not only not prevent, you couldn't even see that it had occurred.

But wait you say I connect to 8 independent nodes?  Do you?  If there is enough incentive to steal don't you think a botnet for example could produce tens of thousands of "independent" nodes and poison the pool of potential nodes around you.  Now currently there is very limited value in an attacker doing that as each full node (in in the case of electrum the electrum server is doing the full node validation) implicitly does NOT TRUST anything any nodes tells it and validates every block, every transactions, every output back to the genesis block if necessary.  So a "poisened node" strategy has very little utility. 

But against a "naive node" well that is a different story.  Let the false history games begin.

TL/DR:   This is money.  If someone can exploit your system to steal money they will.  Period. 

I guess it depends on what you mean by micro transactions.  I mean look at the tempest in a teacup about setting the default dust limit at 5430 satoshis (~0.5 cents).   If you mean <$0.10 (in 2013 USDs) then probably not.  If you $0.10 to a couple bucks then it likely will be some time before those transactions are not economically viable. 

BTW I am not opposed to solving the "block size" problem I am just pointing out that the situation is slightly more complex then some make it out to be.  There is always some level of centralization, an unlimited blockchain simply pushes us towards a different kind of centralization.

How many tx the network eventually happens, what the costs will be, how big Bitcoin gets are all unknown.  My guess is likely no better than anyone elses.  I do believe a alt-coin built from ground up around low cost microtransactions could carve out a niche.  I also think off blockchain transactions aren't that scary. I don't like the idea of web wallets holding massive wealth but I could really careless of the security implications of using off blockchain transactions to buy a cup of coffee or some discount steam game.

What stored value?  Bitcoins aren't stored value.  What obligation does a Bitcoin create for the seller?   None.  A bitcoin sold can't be later "redeemed" by the buyer at the obligation of the seller.  Once sold it is sold and no obligation exists on either party. FinCEN (even as broadly interpreting as they are) has stated that decentralized virtual currencies are not prepaid access (another term for stored value).

Agreed.  OP please change the title.  Why not just ask "why does blockchain.info show a tx but blockexplorer doesn't?" instead of making an accusation in the question.

If you had asked that ... the simple answer is:
blockchain.info shows unconfirmed tx.
blockexplorer only shows confirmed (i.e. in a block) txs.

Any transaction (all 3,000 or so which exist right this second) will be listed in blockchain.info but not in blockexplorer.

Agreed higher bandwidth connections will be more common in the future however if 1% of potential users have a 1 Gbbps connection and that becomes the minimum then you have reduced the potential full nodes to <1% of the planet.  The numbers also aren't as rosy as they seem on first glance.  A node by definition needs connections to multiple peers so a node connected to 8 peers will rebroadcast a tx it receives to 7 peers.  Now 8 is the minimum for network security we really want a huge number of nodes with high levels of connectivity (20, 30, 500+ connections).  So lets look at 20.  1 Gbps / (400 bytes per tx * 19 peers to relay * 8 bits per byte) = ~16,000 tps.  Now 16,000 tps per second is still a huge number.  However that would limit full node participation to those with 1 Gbps.  However the real problem is real bandwidth vs marketing.

1 Gbps sounds great until you saturation your uplink at 1 Gbps 24/7 continually every second.  In no time flat the ISP is going to cut you off or throttle you.   Even if they have no hard bandwidth caps all ISP agreements have "reasonable usage" guidelines.  Residential bandwidth is shared.  No company could offer (even at cost) 1 Gbps for $100 per month if every user (or even a small minority) actually maxed it out.  If you want real pricing take a look at what most datacenters charge for bandwidth.  1 Gbps is going to cost a LOT more than $100 per month, probably more than $1,000 per month (although the cost does get cut in half every 12-18 months).

The last issue is what Nagato mentions above (although his numbers are low due to the need to broadcast to multiple peers).  For miners their outgoing bandwidth is "bursty".  A miner needs to broadcast his found block very quickly to as much of the network as possible.  Every 6 seconds in delay increases the orphan rate by ~ 1%.  If targeting a 3 second window to send a 10 MB block to 50 connected peers in 3 seconds we are looking at 10 MB * 8 bits per byte * 50 peers / 3 seconds = ~1,300 Mbps.   Lower connectivity will put the miner at a disadvantage to better connected miners.  If this barrier is too high you will see even more migration to the largest pools as they can afford the high levels of connectivity needed.  Slower pools will essentially have a 1% to 3% or more "hidden" oprhan tax.  As miners discover that they will migrate to the better paying pools.  


When the average user has "true" 1 Gbps connectivity at a reasonable cost and the average miner can obtain "true" 10 Gbps connectivity then maybe.  BTW despite the post I am bullish on Bitcoin, solutions can be found however those advocating dropping all limits because of "centralization" need to realize at the far extreme it just leads to another form of centralization.  When only a tiny number of players can afford the cost of running a mining pool (and 1, 10, 50 Gbps low latency connectivity) or run a full node you have turned the p2p network into a group of a few hundred highly connected peers.   Guess what modern banking IS a peer to peer network of a few hundred highly connected peers.   The fact that you can't be a peer on the interbank networks doesn't mean the network doesn't exist.  The barriers (legal, regulatory, and cost) just prevent you from becoming a peer.


Today maybe.  But lets look at just a 10MB block for a node with only 8 peers (dangerously low IMHO).  That requires about 64 Mbps sustained.  Due to the bursty nature for this peer to provide any value relaying blocks the peak bandwidth would need to be 10x higher (640Mbps).  The larger obstacle isn't sustained or peak speeds (more than acheivable from a technical standpoint).  The larger obstacle is how much burden it would put on ISP networks (which are generally massively oversubscribed).  Total bandwidth used for this peer is ~350 GB per month.   Most ISP will cap a user long before that.  The biggest ISP, comcast, IIRC starts throttling at ~200 GB per month (less on cheaper plans).  The first time a casual user either has his download speeds cut 80% or gets a warning from his ISP on having to pay overage fees he likely is going to pull the plug.  Maybe not every user but at least some users will.

Neither.  The service has a minimum of $1,000.  However any questions related to that service would be better posted to that thread.
https://bitcointalk.org/index.php?topic=87094

Yeah I was puzzled by that as well.   None of the questioners asked him to clarify.  Of course most of the people lining up to "ask questions" are usually ones trying to push an agenda or make long monologs in the form of questions.   They already have their questions in mind before the panel start.

I wish he would clarify. I mean like it or not Bitcoin can't be changed.  It can be forked but barring a complete consensus of all users (not all miners or developers but all users) the existing network will continue to operate.  Nobody is going to get a consensus on moving from POW.  So not sure how he can be bullish on Bitcoin and at the same time say Bitcoin is dead unless it moves beyond POW.  If true (which I doubt) then Bitcoin is already dead and just doesn't know it.

All nodes will drop a tx from the memory pool, however your node will continually (on a schedule) rebroadcast the tx to peers (who update their memory pool and relay it to other peers).

So you need to prevent your node from rebroadcasting the tx first.  That is tough as the client isn't designed to "undo" tx.  You need to manually edit the wallet to remove the offending transaction and then keep your node offline.  Eventually all other nodes will drop the transaction and you can respend the coins.

Other exchanges would gain marketshare.
Now compare that to what happens "if" LR gets shutdown overnight.

Nobody is saying a major exchange closing wouldn't be disruptive but with a centralized currency it is a complete failure of the network.

BTW: MtGox marketshare has been declining.  Over last 7 days it has been 66% of the major exchanges.
http://www.bitcoinity.org/markets/list?currency=ALL&span=7d

Of course that 66% excludes other exchanging methods like OTC.

Well the block subsidy has already decreased from 50 to 25 so obviously the incentive for miners has fallen and the network computing power has gone down.  Er wait it hasn't.

ALL money is merely an accounting ledger.  One can't "move" fiat" into Bitcoin that would imply the supply of fiat would reduce and the supply of Bitcoin would increase.  One however can opt to exchange fiat for Bitcoin.