No thanks.  There's no need to protect it from a hopeless would-be attack that won't work anyway.  This is like seeing a tramp standing there with a spoon hoping it'll start to rain soup.  Maybe it'll rain.  Maybe he'll catch a few drops in his spoon.  It won't do him any good to eat it, and if he plans to convince someone else that it's real soup and sell it to them, that's dishonest but so what? It isn't going to work anyway.  There's no point taking his spoon away, except perhaps to remind him that honest people work for a living.  And that's something his parents ought to've done, not something the law needs to worry about.

Explaining exactly how you intend to steal an asset which you will immediately render worthless by stealing it doesn't mean that what you are doing is not stealing.

Seriously?  Your interest in this whole thing is for nothing but figuring out a way to steal?  What a pathetic piece of crap you are.  But, okay, let's run with it.

Let's say you take an output from your hip pocket, and then make two conflicting transactions -- one that sends it to your coat pocket and one that sends it to your shirt pocket.   After a few tries, you get the <1MB chain to think it's in your coat pocket and the >1MB chain to think it's in your shirt pocket.  Success!  Now you can make transactions that are valid only in one chain, so you can attempt to steal stuff from people by double spending!

Now, think about this.  Which set of people can you steal stuff from by double spending?  The ones who are getting tx accepted within 10 minutes and reach confirmation depth within an hour, or the ones who are getting 1/7 of their tx accepted in a given 3.3-hour span, and which, even when accepted, don't reach confirmation depth for a day and a half?

The people who are vulnerable to your double spending scam are the ones on the <1MB chain.  And when some bastard manages to scam you because you got stuck on the losing side of a hard fork, then the way to get safe is to get the hell off that crippled damn thing and onto the main branch.

It is in fact thieves like yourself who will do us the favor of putting the <1MB chain out of its misery.  The fact that you will do so by ripping people off and driving your victims away is despicable.

This makes so much nonsense it's breathtaking.  It is a single, perfect, priceless jewel that deserves to be preserved for all time.  I was unaware that such pure examples of nonsense existed in the modern world.  I am humbled before a true master.

Quoting myself from another thread....  given a bit of data, I think 12x average utilization is probably a very good target for a maximum utilization.  It seems to work for VISA (most of the time, at any rate).  That would put us at 3600KB blocks for now, and if there's a "phase shift" where utilization suddenly goes up by a factor of 100, we'd be able to adapt within a couple of weeks, meaning before the opportunity is completely gone.

Really, what I'm worried about is the 'phase shift' scenario.  I've worked at a bunch of startups, and when a new thing hits, it tends to hit suddenly and hard.  At a completely unpredictable time, after/during years of hard work during which you don't know whether it's going to happen let alone when.  

If Bitcoin goes mainstream, it will not do so gradually; it will be a phase shift where, a few months after 'a few' people are using it here and there, 'everybody' is using it all the time.  

I think we need an adaptive limit because the exponential growth outlined by Gavin is too slow to handle that kind of rapid  phase shift.  It's the right shape for the curve, but the curve happens over a period of twenty weeks, not over a period of twenty years.  And you never know when the curve you need to respond to is ready to begin.   Not being ready to roll out and scale, QUICKLY, could result in missing it when the opportunity does happen.  Scaling in advance of need, on the other hand, simply invites the waste of resources.

All that said, yes, I am STILL in favor of raising the block size limit, whether it is done the way I'd prefer it, or not.  As far as I'm concerned, this proposal is still "HELL YES" even though I think I might know a better way to do it, because not doing either thing would make failure certain.

That is a very valuable observation.  An 'adaptive' block size limit would set a limit of some multiple of the observed transaction rate, but most of its advocates (including me) haven't bothered to look up what the factor ought to be. what you looked up above presents real live information from a functioning payment system. 

The lesson being that an acceptable peak txn rate for a working payment network is about 12x its average txn rate. 

Which, in our case with average blocks being around 300 KB, means we ought to have maximum block sizes in the 3600KB range. 

And that those of us advocating a self-adjusting block size limit ought to be thinking in terms of 12x the observed utilization, not 3x the observed utilization.

The more merchant involvement there is, the more we need to be thinking about the spikes associated with merchant business.   We need to think about what happens at 8 AM Pacific Time on Black Friday - when the local credit card network in the places where I shopped couldn't handle the traffic and were knocked offline for an hour and then backlogged for the next six.

The more trader business there is, the more we need to be thinking about the spikes associated with exchange businesses.  We need to think about what happened in the markets the next day after Jim Leeson took down Barents, when the mortgage meltdown chain reaction set in after Lehman Bros. defaulted and made $trillions evaporate overnight, when Madoff announced that his $billions were all part of a Ponzi scheme, and when Cyprus announced its plan to just TAKE whatever money people happened to have trusted banks with.  When people finally take that 'Beware False Profits' message to heart, odds are they'll want to trade into Bitcoin.  It'd be a real shame if they can't.

And we also need to consider the enormous follow-on effects of government decisions that change the rules more broadly.  We need to think about what happens at 8 AM GMT on the International Currency Exchange the day after Brussels announces that Europe will either form a fiscal union (ie, have a uniform tax law and a uniform policy for allocation of the funds so collected) or end its attempt to have a common Euro fiat currency without one.  'Cause that's going to happen - what they've got now isn't a stable configuration in the long term.

I think there's all kinds of reasons why, when we need bigger volume, we're going to need enormous amounts of it very suddenly.  The call for bigger volume is sometimes a result of predictable but large events, and sometimes a response to statistical 'Black Swan' events that result in a scramble to reach a new balancing point far from the old one.

We're seeing spikes to 1MB now, even without driving events we can point at. So, at the moment when 1MB definitively isn't enough, I fear that 5MB won't be enough either.  Transaction volume in the real world is incredibly spiky in response to such events, and Bitcoin is starting to have closer and closer interactions with the 'real world.'

Cryddit

You fail.

I have read that paper, ages ago.  One of the many things he did not mention was any form of money whose transaction rate is limited in time.

Welcome to my kill file, because you are lying.

You were asked a direct question.  You have not answered it.  Please provide a direct answer, by citing a specific paper, published on a specific date, that someone can look up and go read.  

I reiterate.  I have read Nash.  He did not write about any situation in which the total transaction rate per time was constrained.  Your claim to the contrary is without proof.  If you disagree -- that is, if you have proof -- then produce it.  Otherwise you will be ignored.

John Nash did not write about nor consider a situation in which the total number of transactions in a given time frame was constrained.  It is that consideration, completely omitted in Nash's writing, that we are discussing. 

Try to keep up.

Yes, Bitcoin could do something like that.  Blockchain pruning has been discussed.  Just issuing a new 'genesis block' containing all extant unspent txouts occasionally is the simplest brute-force blockchain pruning strategy.

The motivations and reward structure for the miners are extremely relevant.  The Nash equilibrium is about distribution of resources, and is not affected by an increase in the supply of a resource that is currently plentiful enough that it hasn't materially affected the dynamics of equilibrium yet.  

This proposed fork would not disturb their present equilibrium, but actually being limited by the block size limit when the time comes that they want to create larger blocks definitely would.  If they find a new equilibrium in which the limitation on block size plays a role, then the proposed fork would disturb that new equilibrium.

In fact, it is false to think that Gavin or anybody else has any authority to hard fork Bitcoin.  There is no such authority; Bitcoin was designed as a system where authority counts for nothing.  The only thing that counts is mining power.

All Gavin can do -- in fact, all that anyone can do unless they are a miner -- is put the code for a hard fork into a client.  

Nobody forces a miner to run that version of the code.  Miners have been tweaking code and compiling their own clients forever.  

The fact is that the only people who get a vote in whether or not a hard fork actually happens are the miners.  And their vote is by hashing power.  

Forget Gavin or anybody else.  What it comes down to is whether the miners choose to put that version number into the header of the blocks they mine, or not.  If they don't, there is no fork.  If they decide they want a different fork and hire some random coder we've never heard of to write it, then if they make a 95% decision, they can deploy that fork without consulting us or even warning us.  

This fork issue is the decision of the miners.  Nobody else, anywhere.

It is not an assumption.  It is a prerequisite.  When the code for a hard fork is deployed, no change to the protocol actually happens until 95% or more of the hashing power (over the most recent thousand blocks) asserts via the protocol-version field in the header that they are ready and willing to convert to the new protocol.

Consequently, 'Gavincoin' as you're calling it WILL NEVER EXIST unless 95% of miners are ready and willing to abandon 'MPcoin'.  

And therefore, at the instant a split happens, 'MPcoin'  blocks will start taking at least 20 times as long and the MPcoin ability to process transactions  will drop to at most 5% of its previous level.  MPcoin could adjust its rates back to one block per 10 minutes, eventually - but making 2016 blocks at that rate will take ten months, and the adjustment after that will take another two and a half, so MPCoin won't be getting back to ten-minute blocks for at least a year after the split.   

Again, this is not an assumption, this is a prerequisite.  If the conditions are not such that this will happen, then the split won't happen in the first place.

Cryddit

I agree with both Keynes and Smith, in thinking that it would be mad to seek to put into place a limit with significance as a market mechanism.  Creating a 'market' imposing a significant cost in fees on ordinary transactions is a poisonous side effect of having a limit at all, and one whose influence we seek to minimize.  The only reason limits are necessary is to prevent denial of service and outright theft of services.

The point of retaining a block size limit at all, in fact, was never driven by any supposed need for scarcity in a fees market; it was and is driven by the fear that the blockchain will be abused, either for an attack on bitcoin itself (ie, making it so onerous to download the chain that bitcoin is thinly supported by full nodes) or as a way of using the block chain to 'steal' huge and inefficiently utilized storage space to record data irrelevant to the purposes of those who would be paying for the storage.

Both of these remain concerns when raising the limit.  But the limit must be raised, because in general it would be actively bad to create a scarcity market in the ability to make transactions.  


Here is an interesting tidbit, although I know well that this is not exactly what you mean by squaring a circle.

But this is the equation of a circle:

x² + y² = 1

And here is the corresponding equation of the square which exactly circumscribes such a circle:

x^infinity + y^infinity = 1

They are more closely related than most people realize.  Similarly, sometimes a very closely related problem which has a simple solution can be found and, for some purposes that solution may serve.

At any rate for practical purposes the impossibility of calculating pi to the last digit isn't a significant limit as to what we can actually do.  Getting 'close enough' to squaring a circle gives results indistinguishable from perfect results.  We can these days square a circle bigger than this solar system with an error smaller than the width of a hydrogen atom.  Even though we will never be able to exactly square a circle, we have reached a point at which our inability to do so imposes no practical limit.

I would support (and prefer) a limit that is set every two weeks (along with difficulty) to thrice the load experienced in the previous two weeks (so that the limit remains approximately thrice the actual usage).  That seems more responsive and more likely to survive relatively sudden and extreme changes in usage patterns if something unexpected happens over the course of a few weeks.  At the same time it doesn't permit horrible abuses by attackers unless they mine a significant fraction of all blocks for a long-ish period of time.

Regardless, I support the plan to increase the block limit whether it is done the way I'd prefer it or not.  Gavin's plan, while simplistic, is a MUCH better plan than failing to increase it.

Cryddit

Interesting, some more.  Also seems to be happening in the EUR/BTC markets.  And now prices are ticking up. 

In standard operation, there is no "seed" that Theymos or anyone else could access.  The hash is calculated from  the password, but only the hash is stored. 

Why the hell would he do that?  What possible purpose would it serve to burden someone with that secret? 

Also, see definition of "secret" -- something known to ONE person.

Blockchain info isn't focused on investor/trader activity.  It shows all transactions, including people who are just buying coats from overstock.com. The trade volume change is appearing only in the $USD/BTC markets at large investment exchanges.