Anti-fork guys: What is YOUR proposal?

[cryptworld]

This is what I don't understand

People keep complaining about the block size increase, but nobody say what is the problem or what would they do instead

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[Wary]

Is anybody discussing this proposal?
In case nobody does, here is the link.

http://bitcoinism.liberty.me/economic-fallacies-and-the-block-size-limit-part-1-scarcity/
http://bitcoinism.liberty.me/economic-fallacies-and-the-block-size-limit-part-2-price-discovery/

The author suggestion is (if I get it correctly) instead of using artificial restrictions, use natural market forces to regulate it.
Currently all new minted bitcoins go to miners. Nodes do their work for free, while carrying expenses (bandwith etc). That is cost of maintaining network goes to nodes, while benefits - to miners and users. That's why number of nodes goes down. The author suggests enabling nodes to charge miners and users for their services. Everyone will be able to earn bitcoins by running a node. It'll fix both the problems: of block size and of node centralization.

I think it is the ideal solution. Pity Satoshi didn't implemented it in the first place. But it's not too late to do it now. Is anybody working on it?

[vm_mpn]

Is anybody discussing this proposal?
In case nobody does, here is the link.

http://bitcoinism.liberty.me/economic-fallacies-and-the-block-size-limit-part-1-scarcity/
http://bitcoinism.liberty.me/economic-fallacies-and-the-block-size-limit-part-2-price-discovery/

The author suggestion is (if I get it correctly) instead of using artificial restrictions, use natural market forces to regulate it.
Currently all new minted bitcoins go to miners. Nodes do their work for free, while carrying expenses (bandwith etc). That is cost of maintaining network goes to nodes, while benefits - to miners and users. That's why number of nodes goes down. The author suggests enabling nodes to charge miners and users for their services. Everyone will be able to earn bitcoins by running a node. It'll fix both the problems: of block size and of node centralization.

I think it is the ideal solution. Pity Satoshi didn't implemented it in the first place. But it's not too late to do it now. Is anybody working on it?

Just reading from your summary not sure if this is the problem being addressed here... Potential problem is a growing number of blockchain transactions and inability to pack them all into small 1Mb blocks, essentially running out of processing capacity. Correct me if I'm wrong.

[Wary]

Currently Bitcoin operates as a state: all bitcoin holders are taxed (it's property tax in form of inflation tax), then the taxes are distributed between miners.
While nodes are supposed to work for free, for the good of the community. All problems are handled by core developers and miners.

So
-We are taxed citizen (taxation without representation).
-Miners are tax-receiving fatcats and IRS rolled together.
-Nodes are conscious volunteers.
-Core devs is parliament that issues laws (block limit etc).
-Enforcement goes though threat of forking.

That's a socialist system. Why should we have it?

What is suggested instead is capitalism: nodes, miners and users provide services to each other for money. All the questions such as block size, number of nodes, compensation to miners and nodes are settled by the demand-supply laws. No political games, no enforcement is required, just free market.

EDIT: nodes are ...

[Wary]

Is anybody discussing this proposal?
In case nobody does, here is the link.

http://bitcoinism.liberty.me/economic-fallacies-and-the-block-size-limit-part-1-scarcity/
http://bitcoinism.liberty.me/economic-fallacies-and-the-block-size-limit-part-2-price-discovery/

The author suggestion is (if I get it correctly) instead of using artificial restrictions, use natural market forces to regulate it.
Currently all new minted bitcoins go to miners. Nodes do their work for free, while carrying expenses (bandwith etc). That is cost of maintaining network goes to nodes, while benefits - to miners and users. That's why number of nodes goes down. The author suggests enabling nodes to charge miners and users for their services. Everyone will be able to earn bitcoins by running a node. It'll fix both the problems: of block size and of node centralization.

I think it is the ideal solution. Pity Satoshi didn't implemented it in the first place. But it's not too late to do it now. Is anybody working on it?

Just reading from your summary not sure if this is the problem being addressed here... Potential problem is a growing number of blockchain transactions and inability to pack them all into small 1Mb blocks, essentially running out of processing capacity. Correct me if I'm wrong.

It is problem only because it is free. Any free resource is tend to become overused. Bitcoin users would devour any amount of transaction bandwidth because they won't have to pay for it. As a result, core developers have to use their administrative power to introduce artificial limitations on this usage:
 1) block size limit
 2) mining reward amount
 3) minimal payment amount limit.
From the other side, nodes have no incentives to spend their money on processors/storage/bandwith, because they are not paid for it, so we have to look for altruists that would work for free "for the good of community".

So we have classical socialism with all the problems of socialism. Introducing payments between miners, nodes and users will transfer this socialist system into a normal market.

EDIT: number two is taken care of by Satoshi. Because of the halvings, the mining reward will be gradually replaced by transaction fee. But the other market machinery we have to introduce ourselves.

[SaltySpitoon]

Currently Bitcoin operates as a state: all bitcoin holders are taxed (it's property tax in form of inflation tax), then the taxes are distributed between miners.
While nodes are supposed to work for free, for the good of the community. All problems are handled by core developers and miners.

So
-We are taxed citizen (taxation without representation).
-Miners are tax-receiving fatcats and IRS rolled together.
-Nodes are conscious volunteers.
-Core devs is parliament that issues laws (block limit etc).
-Enforcement goes though threat of forking.

That's a socialist system. Why should we have it?

What is suggested instead is capitalism: nodes, miners and users provide services to each other for money. All the questions such as block size, number of nodes, compensation to miners and nodes are settled by the demand-supply laws. No political games, no enforcement is required, just free market.

EDIT: nodes are ...

Interesting theory, but users vote for everything. If the Honduran government puts out a fork of Bitcoin, its up to the users to decide whether or not they want to use it. Whether Gavin or the Core devs or whoever is participating in forking is successful is completely to do with survival of the fittest. If the Bitcoin users like Gavin's idea better, then it will become the dominant fork, or vice versa. I'd say that is probably the greatest form of representation. We represent ourselves.
Miners are providing a service. They process transactions, and people making transactions pay for that service. Again, you can choose to include 0 tx fee if you want, but just like in real life, if you want a service done for you for free, expect to wait. You are also free to become a miner yourself.
Core devs are groups of individuals who build on Bitcoin. If you don't like what they are doing, as I said before you can choose not to use their work, you can choose to work on Bitcoin yourself, you can really do whatever you want.

I understand the concept, if the 1mb blocksize is kept, people will have to compete to get their transactions onto a block. There are a couple of issues with that. It could make Bitcoin less competitive as a payment system. Someone with just a few Bitcoins could completely fill blocks in effect keeping others from getting transactions through. Would be a very cheap way to perform a DOS attack on the Bitcoin network. Far cheaper than 51% attacking.

[vm_mpn]

Ditto... I do not know if mandatory fees and blockchain cleaning has been addressed, and I hope it will be at some point... However, even if all transactions are paid for and junk-free we still nowhere near scalability of other payment networks like Visa / MasterCard https://en.bitcoin.it/wiki/Scalability

I also think Bitcoin is entering level of maturity and acceptance where "forking" might become the biggest obstacle to it's growth... And this is not going to get any better with time. This was one of the counter-arguments of Peter T. to Galvin A. block size increase proposal... Other side wants to find a graceful and permeant solution which will not require hard forking every few years. Unfortunately, this solution is nowhere to be seen at the moment, at least not practical anyway.

[Wary]

Interesting theory, but users vote for everything.

It's like vote for US president. Once in 4 years, when there is fork elections, you are given a chance to choose. If 50%+1 of voters have chosen the same that you did, you win. But even this i's not real win, because president policy is a package of dozen items and you'll inevitability get items that you like along with those you hate. Compare it with real democracy: market. You vote every time you go to a shop. And in every shop you have not just two option, but hundreds of them. Hundreds, Carl! Every day!

If the Bitcoin users like Gavin's idea better, then it will become the dominant fork, or vice versa. I'd say that is probably the greatest form of representation. We represent ourselves.

Right. That's why Gavin is going to apply to major miners and exchanges. They are "us". They'll choose and we'll obediently follow. Out of fear of losing all value of our bitcoins, we will obediently download the "proper" wallet update.

Miners are providing a service.

That's right. But the service is currently paid for not by fee, but by mining. Which is a property tax. Every bitcoiner is taxed at about 10% a year. These 10% are divided between miners. Sure, you can also include transaction fee, just like you can bribe an official. Thanks to Satoshi, in several halves time this problem will be fixed, the tax will be replaced by fees, i.e. socialism in this area will be replaced by market. But other areas will not be fixed, unless we do something about it.

Core devs are groups of individuals who build on Bitcoin. If you don't like what they are doing, as I said before you can choose not to use their work, you can choose to work on Bitcoin yourself, you can really do whatever you want.

I can also go in politics and try to become the president. Chances are about the same.

I understand the concept, if the 1mb blocksize is kept, people will have to compete to get their transactions onto a block.

The concept is bit different. The block size will be decided by each miner individually. Which blocks to propagate will be decided by nodes, individually. Which nodes to connect to will be decided by users, individually. This will allow market forces to work and to search for the most effective solution.

Currently market doesn't work properly here, because users don't have enough power. We cannot choose miners, we cannot choose nodes. The only lever we have is, once in forever, in case of fork to (not)download wallet update. (BTW, altcoin is not real lever too). While core developers and miners have a number of levers. They decided on block size, they decided on "dust" transactions, they decide which features to include or postpone. So the market is not balanced, that's why it is more like a state that a market.

In the suggested system we will have an option to choose between nodes and between miners. So they will have incentive to listen to us. Nodes will have an option to choose users and miners. So all market participants will have equal power: each is free to choose whom to deal with and whom not to. Developers will compete for miners. Miners will compete for nodes. Nodes will compete for users. Market as it supposed to be.

[Wary]

Ditto... I do not know if mandatory fees and blockchain cleaning has been addressed, and I hope it will be at some point... However, even if all transactions are paid for and junk-free we still nowhere near scalability of other payment networks like Visa / MasterCard https://en.bitcoin.it/wiki/Scalability

I also think Bitcoin is entering level of maturity and acceptance where "forking" might become the biggest obstacle to it's growth... And this is not going to get any better with time. This was one of the counter-arguments of Peter T. to Galvin A. block size increase proposal... Other side wants to find a graceful and permeant solution which will not require hard forking every few years. Unfortunately, this solution is nowhere to be seen at the moment, at least not practical anyway.

And without forking we, the users, will lose the last lever (apart from bitching on forums). Do we want the trajectory of bitcoins to be determined not by users, but by small group of people and by government that has plenty of levers to influence this group?

[iCEBREAKER]

My dos tacoshi:

First, we must wait and see how the infrastructure and ecosystem react/adapt to scarcity.   Without this crucial empirical data, we cannot make informed future decisions about ideal block sizing.  We cannot risk a civil war between BTC1 and BTC2 camps by forcing the issue prematurely (but if I were actually anti-BTC and pro-alt, I'd relish such a Great Schism).

Second, we must use the results of the experiment with 1MB scarcity to decide on a preliminary blocksize increase, to somewhere between 2MB and 10MB.

20MB blocks can then be considered, if and only if the community, pruning/compression mechanisms, and TOR/DSL are ready to support them.

As a compromise, I'll support an increase to 2MB ASAP, on the condition that we then maintain that limit until facts about market reaction to block real estate scarcity are ascertained.

I'd be OK with closing the loop by doubling block size when block reward halves.

[manselr]

Regarding the OP...Easy.. Make users increase their transaction fee to compete to be one of the few who get into the next block (priority goes to the highest transaction fees).  That way, not only does the little guy get to keep his node (when he would have had to shut it down due to increased expenses following this centralization hard fork), but he might be able to make money mining again as the transaction fees increase making it valuable for the little guy to mine (just like he used to do back in the glory days of bitcoin).  But that solution (among many others I have brought up) brings decentralization back into bitcoin (and we want that), but since we are not in control here, then we will not get what we want (profitable mining again for the little guy).  Instead we will receive centralization.

 The fork will not fill instantly, the "little guy" will be fine keeping his node, he may just have to get a bigger hard drive in a couple of years but that should be a lot cheaper due to storage medias ever dropping $/GB.

I don't see how it will bring decentralization? Just because a few less gigabytes over years? Profitable mining for the little guy has and always will be dependent on external factors (Such as location, electric price, hardware price).

The idea you give just clogs the network forcing anyone who doesn't want to pay large fees to switch to an altcoin, if this went through I would be very happy to be a litecoin bag holder.

Yeah, I don't like the idea of increased fees and off the chain transactions, but I don't like the idea of micropayments on the main blockchain, there should be a limit, and once passed that threshold of too small of a transaction, it goes off the chain. No need to process all those tiny ass transactions in the min blockchain.

[Rampion]

There's about 3.2 billion reasons why a larger block altenative isn't already launched.  The assumption is that this change to the protocol should be accepted by existing Bitcoin users, miners, exchanges, wallets, etc. and thus the $3.2 market cap would transfer in its entirety to the hardfork side.     But this Bitcoin-XT (specifically, the change to support larger blocks) should simply be considered as being a new coin -- one with initial distribution (premine) such that 1 UTXO exists in the new coin for each UTXO that existed in Bitcoin at the time of the hard fork.

The only way for the new coin to have any chance of having an impact is if it captures all the existing traction and momentum that Bitcoin has received to-date.

Sure, that's a lofty goal.   Essentially, those pushing this new coin (BTX) want to gamble with our bitcoins (BTCs).

Maybe the solution is to simply treat this new coin  .... as a new coin, difficulty 1, and no premine.

This is the best post in the thread IMO - this is exactly how I see it.

Thanks, Stephen.

[iCEBREAKER]

There's about 3.2 billion reasons why a larger block altenative isn't already launched.  The assumption is that this change to the protocol should be accepted by existing Bitcoin users, miners, exchanges, wallets, etc. and thus the $3.2 market cap would transfer in its entirety to the hardfork side.     But this Bitcoin-XT (specifically, the change to support larger blocks) should simply be considered as being a new coin -- one with initial distribution (premine) such that 1 UTXO exists in the new coin for each UTXO that existed in Bitcoin at the time of the hard fork.

The only way for the new coin to have any chance of having an impact is if it captures all the existing traction and momentum that Bitcoin has received to-date.

Sure, that's a lofty goal.   Essentially, those pushing this new coin (BTX) want to gamble with our bitcoins (BTCs).

Maybe the solution is to simply treat this new coin  .... as a new coin, difficulty 1, and no premine.

TYVM for eloquently expressing why when discussing the present situation many use words like coup, megalomania, Gavinista, and GavinCoin.

XT would ideally be launched like a stock split, with shares in the new spin-off distributed pro-rata, not imposed from above as the mother of all scamcoins.

As bad as the 20-cum-8MB proposal is, the core dev team meltdown it's revealing and compounding is even more potentially dangerous for the system's diffuse/diverse/defensible/resilient antifragility suite.

[Agestorzrxx]

I am not object a hard fork. But i believe before we do it, we should study more. We may increase the block size successful in this time, but next time, what's we can do, it will be more difficult to do such a hard fork.