miners will mine for transaction fees.

There seems to be some concerns around how that will pan out.

yes the total number of bitcoins will decline, and do so before the point at which the last bitcoin has been mined.

If you think of someone losing access to a wallet with 100 bitcoins in it, then there is subtle deflation from time to time already, as it would take half an hour to replace that loss but the loss happens instantly.

It is funny that you think google would not be as restrictive - if they feel they can do it without losing market share.

Look at what they're doing on youtube now. It was all free and easy on the way up, now it is dominant - and suddenly they iron fist comes out.

What keeps these companies honest is several market leaders fighting each other to please us, not lemmings running to one platform.

any app that threatens the google business model will not be allowed on android, if not now, then later, after you have nowhere else to go.

you got it back to front.

difficulty changes SUCH THAT the blocks are found at roughly 8 minute intervals.
Of course that is the average over many samples, so there can be several blocks in a row or nothing for 30 minutes, but difficulty steps up or down such that on average that is the output. At any time.

It is exponential now because people are adding exponential mining power.

I found the paper in May that put two different qubit chips up against software and hardware solvers in a very specific class of problem, and the results were that with a problem that is most suitable for the chip it found a solution in half a second, several thousand times faster than the best traditional methods.

There were a lot of ifs/buts and exceptions however the V5 and V6 chips tested, when given the right kind of problem, were indeed able to solve it (it was an annealing problem) in a grand flash.

A clear eyed summary on that May paper, and the D-Wave devices is here: http://spectrum.ieee.org/computing/hardware/dwaves-year-of-computing-dangerously

I've no doubt that quantum computing is going to be an arms race, and it will start to solve in parallel more problems over time. Whether that includes searching for keys or cryptography I've no idea but if it does you CAN BET THAT NSA WILL NOT TELL US ABOUT IT.

I don't think you read your own wiki

"Bitcoin has some exposure to fraudulent double-spending when a transaction is first made, with less and less risk as a transaction gains confirmations."

The whole point of balling up transactions into a block is to agree they are not fraudulent. And that agreement doesn't happen for up to half an hour. Thus, the exposure prior to that while not interesting for a cup of coffee is very interesting for $100 worth of liquor or a $1000 handbag or the majority of other point of sale purchases now done with credit cards!

you are assuming here that you have to "run back to your car", and so on.

If a transaction requires that it be included in a block to be valid (and it does), then you can double-spend by double-spending at the same time.

Just send the amount to another wallet you control while buying the groceries, using your phone which is on the network as well.

At least 50% of the time, you will win, even if you can't work out how to defeat it 100% of the time.

And 50% is a pretty good discount.

Therefore my conclusion is BTC will require another layer, providing wallet identification, in order to be trusted for the transactions that are handled with a confirmation point of sale "beep" that tells the checkout person to let you walk away with the bag.
It will have to be opt-in. You want to buy something truly instantly, not 1 to 30 minute instantly? you must use a wallet with an identity attached and a third party service handling the verifications of those identities. One way or another.

Oh whoops we're back to credit cards again.

there is only no charge back if the retailer waits for the 1st confirmation for small amounts, and the 2nd confirmation or more for larger amounts.

Waiting for the first confirmation can be 1 minute or 25+ minutes.

For buying anything needing shipping, that is fine, e-tailer just places a hold on the stock item. But for buying groceries it is ridiculous. If they do not wait for the first confirmation then unless they have another way to identify a customer they are going to be giving away groceries to any thief willing to read a FAQ.

Notice you dont really grab your bag of items until the credit card machine beeps.

The BTC beep takes between 1 and 25 minutes to arrive, there is no getting around this issue, if you want the wallet to remain anonymous.

vendors account for the bulk of the stolen coins. Apparently the site made some feeble excuse and ceased vendor withdrawals for a week. That is a lot of escrow build up. Some social engineering with a trusted vendor or two kept things from going pear shaped too fast, and then they made off with all the escrow when the jig was up.

Before people say well it is a problem peculiar to pathetic junkies, the same thing could happen to anything in the BTC world that is very popular: An E-commerce site, a tumbler, e-wallet service, btc exchange, you name it.  With sufficient incentive (a lot of btc in transit and a spike in price) the same thing could happen either on purpose or opportunistic or a hack, of course.

You don't have to speculate.

All time:

https://blockchain.info/charts/blocks-size?timespan=all&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address=

one year:

https://blockchain.info/charts/blocks-size?timespan=1year&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address=

On a one year basis looks fairly linear.
On an all time basis you can see some exponential growth.

It is almost entirely driven by this graph:

https://blockchain.info/charts/avg-block-size?timespan=all&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address=

which is the average block size. More transactions per minute, larger average block size.

" if you were to control enough nodes around at least 51% of the computing power couldn't you alter the blockchain to your favor?"


There is already a plausible attack and you just need >= 35% of the hashing power so the current largest mining pool could do it.

The simulator is here:

http://ebfull.github.io/

Basically the evil pool starts to grab an unfair share of the revenue by broadcasting secretly found blocks just before someone else with less connectivity finds a block. Effectively they are exploiting a timing race to tilt the odds and grab revenue due other miners.

This was forshadowed here by a member in 2010 and they also ran some simulations to show the problem, it was re-discovered but with more detail by this guy: http://hackingdistributed.com/2013/11/17/selfish-mining-simulator/

Understanding the machinations of the fees is not the same as the experience as a *user*, and that is the experience I'm attempting to explain because it is the experience the majority of people will have with the software. So these fee topics will keep coming up.

Pay for a faster transfer? how fast is that? it isn't explained. Now I know, but the concept is slippery.

Pay a higher fee when actually your transaction qualifies as fast and free anyway? that is a fee that is wasted.

Does paying a fee increase confirmation time? no, right? yet the confirmation time is a critical part of the transaction time.

shrug, I did read through all this posts not just one or two.

I'd be willing to bet money he is not from the pink parts of the globe let alone non english speaking countries. I'd put money on Satoshi being american. If the post time stamps are not muddled up his posting was also consistent with a north american time zone.

So much for this bet, there was one thing that niggled me. In one post he writes something or other is "bloody hard". That is almost exclusively something a brit would say in a moment of frustration. Also the forum timestamps in UTC are more consistent with a UK resident who sometimes works early in the morning, but mostly in the afternoon, than american. He typed "realize" etc to blend in with the majority of his audience.

Without reading this topic, I have one contribution.

user Satoshi posted shortly before vanishing in 2010:

"I tested it on a slow 7 year old drive, where bandwidth and CPU were clearly not the bottleneck.  Initial download took 1 hour 20 minutes.

If it's taking a lot longer than that, certainly 24 hours, then it must be downloading from a very slow node, or your connection is much slower than around 15KB per sec (120kbps), or something else is wrong.  It would be nice to know what appears to be the bottleneck when that happens."


Given that every time I start bitcoin-qt and the connections indicator goes to healthy green, but the initial download takes more than 24 hours, I would say his original vision for how fast the download for new users should be, is not panning out, and we're not even at 1% of the paypal transaction volume yet.

So what exactly is the problem? that the block chain is growing faster than the average users broadband connection speed, or the network and software design is currently not able to deliver the data as fast as it should -- even after you poke holes in your firewall?

these are his first posts yes?

http://sourceforge.net/mailarchive/forum.php?forum_name=bitcoin-list&max_rows=25&style=nested&viewmonth=200901

From reading them he doesn't strike me as Japanese born, the english is way too smooth unless perhaps he had one western parent. I know a lot of Japanese including plenty that have spent decades living and working in the west, all of them give themselves away with a few paragraphs of spoken or written text.

What was his email back then? Satoshi@vi.. viwhat?

also this was news to me but what do I know

"For now, you can just multiply the total blocks by 50.  The Bitcoin network has been running for almost a year now.  The design and coding started in 2007."

the way he writes that sounds very much how you'd write it if you were heading a group, one that only went public one to two years after getting the basics working.

Also given that he spells "realize" and so on with a Z, his style is firmly american english not british english.

since everyone thinking about anonymity within bitcoin thinks (or worries) about IP addresses, I would attempt to explain more clearly the link between ones IP address, and a transaction one instigates, under the various popular ways one can transact from one address to another.

I don't believe it, the anonymity is apparently good enough for even the stupid bad guys. Bad guys make lots of mistakes, but with BTC they have an easy time of it.

The anonymity risks are at the edge of the network, where you cash out.

Also consider whether you want practical anonymity, or anonymity from the NSA. BTC gets you practical anonymity but plausibly not from the NSA if they are actively monitoring the tx flows in grand style. But if your concern is the NSA, you're going to be letting someone like blockchain.info run the transactions for you, while you use them from a web proxy. Not hard.

if it isn't "practically" and "effectively" anonymous then how come not a single large btc theft has been traced to an individual?

No, the best (and very small number by head count) of them will execute a switch to cash or an alternative so quickly that by the time everyone else sees what is going on it will be too late.

speculative hot money has zero respect for bitcoin or even the wider concept of a crypto currency, their mantra is after all never get attached to a stock and for the purposes of riding a curve, bitcoin is a stock. They're happy while it is paying them and will pay lip service (Winklevoss etc) but when they sense the capital appreciation has finished they're gone & without a thought. It isn't even comparable to the change of a stock from growth to income: a stable btc price in USD terms is dead money to speculators, they need a ROI. As a long term store? nope, it is no hedge against huge financial collapse either, mtgox and every other btc to currency converter would fold in a nanosecond if the capital markets imploded.

well what the system does in the last 60 years is pretty close to what it does in the last year, because the production asymptotically approaches zero.

In 2032, which I hope to be around to see, we're already 99% done with production and BTC per block is pretty close to current earned transaction fees per block. So I guess the dynamic in 2030 isn't much different than the subsequent 100 years.

the annoying part is that below about 30 minutes there is no paying for speed.

You can pay all you like, if there is a 20 minute delay before the next block worldwide you're all in the same boat, and your transaction fee is wasted.

Yesterday I did a transaction that qualified as 'free' and had to wait over 30 minutes for the first confirm. It sat unconfirmed for 30 minutes. If I had paid a huge fee, it would have taken the same time! Right?

The other annoying part is that fees do not increase speed of confirmations, and confirmations are a vital part of the transaction. With no confirms the money is effectively in limbo. Again, the fee doesn't help here. Right?

So paying a fee is basically just insurance against a greater than half hour first confirm time, which isn't really the kind of fee that it seems to be on the face of things.