Vitalik Buterin's thoughts about Blocksize increase

[Denker]

Although he might not have much stake in Bitcoin I believe his opinion can be interesting for one or the other.

https://np.reddit.com/r/ethereum/comments/380q61/i_know_this_may_not_directly_be_ethereum_related/crrofl6

Hmm. I've been reading Thomas Sowell's Knowledge and Decisions and A Conflict of Visions lately, and his works have impressed upon me how decisions that are made by "ivory tower intellectuals" can often be problematic, as they deal with abstract symbols and are far away from the actual substance of the problems at hand and have little personal incentive to correct their thought patterns (the specific bias at hand is often, but not always, scope insensitivity), and I'm seeing some parallels to that here. If you look at the kinds of people that have opinions on this issue either way, you notice that the kinds of people in favor are businesses that are directly involved in serving thousands of actual customers, whereas those against are largely those with some kind of ideological interest. On the other hand, of course, you could argue that businesses just want to make a profit and don't give a crap about decentralization, and so a weaker blockchain actually benefits them because it lets them build more centralized add-on services on top (the description that Coinbase gave me when I interviewed them for bitcoin magazine back in 2013 was that they want to be "like Gmail on top of SMTP"). In this particular case, I am inclined to side with the businesses more, simply because mining is so centralized already that full node count is not going to be the weakest link in the system at least for another 1-2 orders of magnitude.

If you divorce the decision from its current political context and ask me "what is the optimal block size for a payments blockchain", then I would say exactly what I've done for ethereum: target a limit equal to 1.5x the exponential moving average of the current block size (with perhaps 0.1% replacement per block). Hence my judgement would be to ignore the short-term contingencies and go that way here as well.

On the third hand, yet another perspective is that given the existence of other more powerful blockchain technologies and the fact that even better ones will continue being developed, bitcoin's best chance right now may well be to keep its block size limited and target the niche of digital gold. If that is what Bitcoin users want, then they should keep the limit, and perhaps even decrease it. But if Bitcoin users want to be a payment system, then up it must go.

[ebliever]

Regarding the third point, for bitcoin to be an analog to gold we must keep in mind that gold is universally known and valued. If bitcoin prematurely choked off its own growth and abandoned efforts to mainstream it, I suspect it would slowly wither and die as competing altcoins rose to take its place as an everyday, mainstream cryptocurrency.

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

[marky89]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

[glub0x]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I belive this difference between users of bitcoins is the root of this drama. Some see it as a kind of investment others as a payment protocol,how to solve that? i'm curious

[ebliever]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

Good question. I think cryptocurrency can serve both functions (store of value vs. payment system). In fact I've always been of the opinion that in the long run there will be a handful of dominant cryptocurrencies (not one), each optimized for a particular financial function. These would include, for example (1) a highly secure store of value (AKA digital gold), (2) fully anonymous transactions (3) high speed transactions (such as stock market day traders might want to utilize), (4) a simple, convenient payment system (perhaps at the cost of high security), (5) maximally public transactions (for example, so the public could hold government spending accountable), (6) optimization for micro-payments and no-fee transactions, and so on.

I am skeptical that any one cryptocurrency can really be a "jack of all trades" and be the best choice for all these disparate functions, though there could be linkages between the major cryptocurrencies such as via sidechains. I also believe that there will be dozens of moderately successful "second-tier" cryptocurrencies filling minor financial/technical niches, or appealing to particular demographics and interest groups. The latter doesn't make pure financial sense, but we are dealing with human interests and human foibles. So I guess I'm saying, dogecoin is here to stay. ;-)

If I'm right, then _something_ will ultimately take on the role of "digital gold." But for bitcoin to take on this role, something else has to take on a co-flagship role as a mainstream payments processor or the whole cryptocurrency industry will suffer a setback. So far everything has been too much in flux for the cryptocurrency scene to gravitate towards my vision of the future, though I have faith that my underlying logic is sound and that it will eventually be born out.

[adamstgBit]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I can't imagine how this would positively affect price.
primary value or not, price WILL be affected.
at this point if devs don't fix the TPS limit ( bumping the block size limit slightly is a fine solution for now), i'm stepping out, not because it would imply bitcoin will never be a payment system, but because I will no longer trust the dev team to make smart decisions, or make any hard decisions at all for that matter, and would deem bitcoin's development process borken. but i am confident they will up the TPS limit in some form or another in due time.

[brg444]

Regarding the third point, for bitcoin to be an analog to gold we must keep in mind that gold is universally known and valued. If bitcoin prematurely choked off its own growth and abandoned efforts to mainstream it, I suspect it would slowly wither and die as competing altcoins rose to take its place as an everyday, mainstream cryptocurrency.

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

It is also important that you reconsider this myth that capping Bitcoin's transactions is a cap on its userbase.

Bitcoin, as is, can provide a refuge for the wealth of ANY person on the planet. It can currently accommodate an infinite amount of capital.

The distinction is important because reality shows us that actual Bitcoin users are by and large not much interested in transacting or spending their coins. A great majority of the coins in existence have been and should continue to sit pretty in their cold wallets for years to come.

Why should we expect this to be different for future users? If you believe, much like I do, that the next trove of adopters is likely to be institutional investors with an interest in Bitcoin as a commodity/asset then why should we be worried so much with the system's transactions throughput? Do you expect the Winklevies to go on a shopping frenzy with their 100,000 coins? The analogy with gold is tired but it remains true: it should be expect that most bitcoins in circulation will be stored in digital vaults and shall remain untouched for a long period of time.

All of this is to say that you should stop focusing on "mainstream" users and what you assume their interest in Bitcoin will be. We should expect these to be last in line in your mass adoption scenario.

[RocketSingh]

Although he might not have much stake in Bitcoin I believe his opinion can be interesting for one or the other.

https://np.reddit.com/r/ethereum/comments/380q61/i_know_this_may_not_directly_be_ethereum_related/crrofl6

Hmm. I've been reading Thomas Sowell's Knowledge and Decisions and A Conflict of Visions lately, and his works have impressed upon me how decisions that are made by "ivory tower intellectuals" can often be problematic, as they deal with abstract symbols and are far away from the actual substance of the problems at hand and have little personal incentive to correct their thought patterns (the specific bias at hand is often, but not always, scope insensitivity), and I'm seeing some parallels to that here. If you look at the kinds of people that have opinions on this issue either way, you notice that the kinds of people in favor are businesses that are directly involved in serving thousands of actual customers, whereas those against are largely those with some kind of ideological interest. On the other hand, of course, you could argue that businesses just want to make a profit and don't give a crap about decentralization, and so a weaker blockchain actually benefits them because it lets them build more centralized add-on services on top (the description that Coinbase gave me when I interviewed them for bitcoin magazine back in 2013 was that they want to be "like Gmail on top of SMTP"). In this particular case, I am inclined to side with the businesses more, simply because mining is so centralized already that full node count is not going to be the weakest link in the system at least for another 1-2 orders of magnitude.

If you divorce the decision from its current political context and ask me "what is the optimal block size for a payments blockchain", then I would say exactly what I've done for ethereum: target a limit equal to 1.5x the exponential moving average of the current block size (with perhaps 0.1% replacement per block). Hence my judgement would be to ignore the short-term contingencies and go that way here as well.

On the third hand, yet another perspective is that given the existence of other more powerful blockchain technologies and the fact that even better ones will continue being developed, bitcoin's best chance right now may well be to keep its block size limited and target the niche of digital gold. If that is what Bitcoin users want, then they should keep the limit, and perhaps even decrease it. But if Bitcoin users want to be a payment system, then up it must go.

The bold part in his statement seems to be mostly implemented in BIP 106.

[brg444]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I can't imagine how this would positively affect price.
primary value or not, price WILL be affected.
at this point if devs don't fix the TPS limit ( bumping the block size limit slightly is a fine solution for now), i'm stepping out, not because it would imply bitcoin will never be a payment system, but because I will no longer trust the dev team to make smart decisions, or make any hard decisions at all for that matter, and would deem bitcoin's development process borken. but i am confident they will up the TPS limit in some form or another in due time.

I'm certain it will have a considerable positive effect on the price as it demonstrates that no amount of corporate and political interests can change Bitcoin.

The TPS limit has existed since you started using Bitcoin Adam, you have been sold a lie that we are under urgency to change it. There actually is none. Our primary focus should be on maintaining the security and decentralization and not fold under pressure from some startups that want to fill the blockchain with useless transactions.

Bitcoin's immediate future growth, as far as price is concerned, can only come from its attribute as a tradeable commodity. People will continue to spend fiat as long as governments insist on printing them. That's called Gresham's law. No amount of VC-backed billion dollars "entrepreneurship" is going to take Bitcoin mainstream to the consumer retail segment until several years. Even the smartest actors in this industry have already figured it out (see Vinny Lingham's most recent comments).

As such, the blockchain will continue to see marginal use as a transactional currency apart from some niche use cases.

[ebliever]

Regarding the third point, for bitcoin to be an analog to gold we must keep in mind that gold is universally known and valued. If bitcoin prematurely choked off its own growth and abandoned efforts to mainstream it, I suspect it would slowly wither and die as competing altcoins rose to take its place as an everyday, mainstream cryptocurrency.

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

It is also important that you reconsider this myth that capping Bitcoin's transactions is a cap on its userbase.

Bitcoin, as is, can provide a refuge for the wealth of ANY person on the planet. It can currently accommodate an infinite amount of capital.

The distinction is important because reality shows us that actual Bitcoin users are by and large not much interested in transacting or spending their coins. A great majority of the coins in existence have been and should continue to sit pretty in their cold wallets for years to come.

Why should we expect this to be different for future users? If you believe, much like I do, that the next trove of adopters is likely to be institutional investors with an interest in Bitcoin as a commodity/asset then why should we be worried so much with the system's transactions throughput? Do you expect the Winklevies to go on a shopping frenzy with their 100,000 coins? The analogy with gold is tired but it remains true: it should be expect that most bitcoins in circulation will be stored in digital vaults and shall remain untouched for a long period of time.

All of this is to say that you should stop focusing on "mainstream" users and what you assume their interest in Bitcoin will be. We should expect these to be last in line in your mass adoption scenario.

You make a valid point that a large number of users can still adopt bitcoin IF the transaction velocity of the money supply remains low enough. But this doesn't address my point that gold has a high value in part because everyone values it. To get to that point I think the average person needs to have some kind of tangible contact with bitcoin, obtaining and using it at least occasionally. And that would mean that mainstreaming of bitcoin as a payment processing system has to come first. The digital gold function (with the implication of high value) would derive from that success, IMHO.

[tsoPANos]

This is the perfect answer for the creator of ethereum.
He didn't put himself at either side, he just made it look like he is independent, and
he thinks his model of ethereum could be aplied on bitcoin!
It's good! Because I made it! Also he makes us believe bitcoin has undoubtedly unsolvable critical flaws.
But don't worry! This is why I made ethereum!
It's doesn't carry these flaws, plus it has much more potential!

Obviously sarcastic, don't listen to the enemies.

[marky89]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I can't imagine how this would positively affect price.
primary value or not, price WILL be affected.
at this point if devs don't fix the TPS limit ( bumping the block size limit slightly is a fine solution for now), i'm stepping out, not because it would imply bitcoin will never be a payment system, but because I will no longer trust the dev team to make smart decisions, or make any hard decisions at all for that matter, and would deem bitcoin's development process borken. but i am confident they will up the TPS limit in some form or another in due time.

I guess I take the opposite approach. If the devs were to implement something so reckless as BIP101 (as an example), my confidence in bitcoin would be crushed and I would largely exit my investment position. At least, I would never transact on the XT chain -- outside of double spending -- should a valid chain coexist with it.

Many don't realize it, but the robust, secure system that we have now, the consensus on the protocol that exists now -- these are the priorities. When it comes to "the dev team mak[ing] smart decisions," I hope that whatever populist arguments and arbitrary timelines that segments of the community produce are tertiary to those concerns. Conceding to those largely arbitrary and tertiary concerns would indicate to me that the development process is broken.

[adamstgBit]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I can't imagine how this would positively affect price.
primary value or not, price WILL be affected.
at this point if devs don't fix the TPS limit ( bumping the block size limit slightly is a fine solution for now), i'm stepping out, not because it would imply bitcoin will never be a payment system, but because I will no longer trust the dev team to make smart decisions, or make any hard decisions at all for that matter, and would deem bitcoin's development process borken. but i am confident they will up the TPS limit in some form or another in due time.

I guess I take the opposite approach. If the devs were to implement something so reckless as BIP101 (as an example), my confidence in bitcoin would be crushed and I would largely exit my investment position. At least, I would never transact on the XT chain -- outside of double spending -- should a valid chain coexist with it.

Many don't realize it, but the robust, secure system that we have now, the consensus on the protocol that exists now -- these are the priorities. When it comes to "the dev team mak[ing] smart decisions," I hope that whatever populist arguments and arbitrary timelines that segments of the community produce are tertiary to those concerns. Conceding to those largely arbitrary and tertiary concerns would indicate to me that the development process is broken.

this is a perfect example of ivory tower thinking.

in reality the system would be no less robust & secure should the the limit be bumped to 2MB or even 8MB, MAYBE at 32MB your arguments would START to make SOME sense beyond ideological interest.

[brg444]

Regarding the third point, for bitcoin to be an analog to gold we must keep in mind that gold is universally known and valued. If bitcoin prematurely choked off its own growth and abandoned efforts to mainstream it, I suspect it would slowly wither and die as competing altcoins rose to take its place as an everyday, mainstream cryptocurrency.

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

It is also important that you reconsider this myth that capping Bitcoin's transactions is a cap on its userbase.

Bitcoin, as is, can provide a refuge for the wealth of ANY person on the planet. It can currently accommodate an infinite amount of capital.

The distinction is important because reality shows us that actual Bitcoin users are by and large not much interested in transacting or spending their coins. A great majority of the coins in existence have been and should continue to sit pretty in their cold wallets for years to come.

Why should we expect this to be different for future users? If you believe, much like I do, that the next trove of adopters is likely to be institutional investors with an interest in Bitcoin as a commodity/asset then why should we be worried so much with the system's transactions throughput? Do you expect the Winklevies to go on a shopping frenzy with their 100,000 coins? The analogy with gold is tired but it remains true: it should be expect that most bitcoins in circulation will be stored in digital vaults and shall remain untouched for a long period of time.

All of this is to say that you should stop focusing on "mainstream" users and what you assume their interest in Bitcoin will be. We should expect these to be last in line in your mass adoption scenario.

You make a valid point that a large number of users can still adopt bitcoin IF the transaction velocity of the money supply remains low enough. But this doesn't address my point that gold has a high value in part because everyone values it. To get to that point I think the average person needs to have some kind of tangible contact with bitcoin, obtaining and using it at least occasionally. And that would mean that mainstreaming of bitcoin as a payment processing system has to come first. The digital gold function (with the implication of high value) would derive from that success, IMHO.

I don't see how that is true. In fact I'm quite certain a majority of the biggest bitcoin owners have never really bothered using it as transactional currency aside from for some niche use case or outright curiosity.

Don't forget that we are not targetting the "average person". They are not the ones that will bring value to Bitcoin.

The digital gold function, as a store of wealth, is the primary natural function of Bitcoin. It is the first step toward any considerable rise in its currency application.

http://nakamotoinstitute.org/mempool/the-two-ideologies-in-bitcoin/

[brg444]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I can't imagine how this would positively affect price.
primary value or not, price WILL be affected.
at this point if devs don't fix the TPS limit ( bumping the block size limit slightly is a fine solution for now), i'm stepping out, not because it would imply bitcoin will never be a payment system, but because I will no longer trust the dev team to make smart decisions, or make any hard decisions at all for that matter, and would deem bitcoin's development process borken. but i am confident they will up the TPS limit in some form or another in due time.

I guess I take the opposite approach. If the devs were to implement something so reckless as BIP101 (as an example), my confidence in bitcoin would be crushed and I would largely exit my investment position. At least, I would never transact on the XT chain -- outside of double spending -- should a valid chain coexist with it.

Many don't realize it, but the robust, secure system that we have now, the consensus on the protocol that exists now -- these are the priorities. When it comes to "the dev team mak[ing] smart decisions," I hope that whatever populist arguments and arbitrary timelines that segments of the community produce are tertiary to those concerns. Conceding to those largely arbitrary and tertiary concerns would indicate to me that the development process is broken.

this is perfect example of ivory tower thinking.

No, it's called a meritocracy.

Of course it doesn't work like democracy hence why you are so butthurt because you'd like to be able to pretend that everyone has equal weight in these decisions. Matter of fact is they don't.

[adamstgBit]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I can't imagine how this would positively affect price.
primary value or not, price WILL be affected.
at this point if devs don't fix the TPS limit ( bumping the block size limit slightly is a fine solution for now), i'm stepping out, not because it would imply bitcoin will never be a payment system, but because I will no longer trust the dev team to make smart decisions, or make any hard decisions at all for that matter, and would deem bitcoin's development process borken. but i am confident they will up the TPS limit in some form or another in due time.

I guess I take the opposite approach. If the devs were to implement something so reckless as BIP101 (as an example), my confidence in bitcoin would be crushed and I would largely exit my investment position. At least, I would never transact on the XT chain -- outside of double spending -- should a valid chain coexist with it.

Many don't realize it, but the robust, secure system that we have now, the consensus on the protocol that exists now -- these are the priorities. When it comes to "the dev team mak[ing] smart decisions," I hope that whatever populist arguments and arbitrary timelines that segments of the community produce are tertiary to those concerns. Conceding to those largely arbitrary and tertiary concerns would indicate to me that the development process is broken.

this is perfect example of ivory tower thinking.

No, it's called a meritocracy.

Of course it doesn't work like democracy hence why you are so butthurt because you'd like to be able to pretend that everyone has equal weight in these decisions. Matter of fact is they don't.

its ivory tower thinking plain and simple.

in reality the system would be no less robust & secure should the the limit be bumped to 2MB or even 8MB, MAYBE at 32MB your arguments would START to make SOME sense beyond ideological interest.

[brg444]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I can't imagine how this would positively affect price.
primary value or not, price WILL be affected.
at this point if devs don't fix the TPS limit ( bumping the block size limit slightly is a fine solution for now), i'm stepping out, not because it would imply bitcoin will never be a payment system, but because I will no longer trust the dev team to make smart decisions, or make any hard decisions at all for that matter, and would deem bitcoin's development process borken. but i am confident they will up the TPS limit in some form or another in due time.

I guess I take the opposite approach. If the devs were to implement something so reckless as BIP101 (as an example), my confidence in bitcoin would be crushed and I would largely exit my investment position. At least, I would never transact on the XT chain -- outside of double spending -- should a valid chain coexist with it.

Many don't realize it, but the robust, secure system that we have now, the consensus on the protocol that exists now -- these are the priorities. When it comes to "the dev team mak[ing] smart decisions," I hope that whatever populist arguments and arbitrary timelines that segments of the community produce are tertiary to those concerns. Conceding to those largely arbitrary and tertiary concerns would indicate to me that the development process is broken.

this is perfect example of ivory tower thinking.

No, it's called a meritocracy.

Of course it doesn't work like democracy hence why you are so butthurt because you'd like to be able to pretend that everyone has equal weight in these decisions. Matter of fact is they don't.

its ivory tower thinking plain and simple.

in reality the system would be no less robust & secure should the the limit be bumped to 2MB or even 8MB, MAYBE at 32MB your arguments would START to make SOME sense beyond ideological interest.

Do you possess any technical credentials that can support this statement or should we just trust your gut?

[marky89]

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

Doesn't that imply that the priority is maintaining bitcoin as a payment system? Or rather, that the only way towards "future growth" is with low fees/fast confirms? It seems that the digital gold crowd doesn't necessarily see things that way. I, for one, don't see the payment protocol as the primary value; it is wholly secondary to that of decentralized store of value.

I can't imagine how this would positively affect price.
primary value or not, price WILL be affected.
at this point if devs don't fix the TPS limit ( bumping the block size limit slightly is a fine solution for now), i'm stepping out, not because it would imply bitcoin will never be a payment system, but because I will no longer trust the dev team to make smart decisions, or make any hard decisions at all for that matter, and would deem bitcoin's development process borken. but i am confident they will up the TPS limit in some form or another in due time.

I guess I take the opposite approach. If the devs were to implement something so reckless as BIP101 (as an example), my confidence in bitcoin would be crushed and I would largely exit my investment position. At least, I would never transact on the XT chain -- outside of double spending -- should a valid chain coexist with it.

Many don't realize it, but the robust, secure system that we have now, the consensus on the protocol that exists now -- these are the priorities. When it comes to "the dev team mak[ing] smart decisions," I hope that whatever populist arguments and arbitrary timelines that segments of the community produce are tertiary to those concerns. Conceding to those largely arbitrary and tertiary concerns would indicate to me that the development process is broken.

this is perfect example of ivory tower thinking.

in reality the system would be no less robust & secure should the the limit be bumped to 2MB or even 8MB, MAYBE at 32MB your arguments would START to make SOME sense beyond ideological interest.

Re: ivory tower thinking -- cool story. The converse of that ad hominem: your opposition is based on the populist pleb argument: "Nothing can go wrong, full steam ahead, opposition is nothing more than ideology, exponential adoption, $100k bitcoins, rabble rabble."

That issues of scaling are taken so lightly is worrisome. I can entertain the argument that conditions now are testable for a 2MB limit regime. 32MB and beyond (or even 8MB) is exactly what I'm talking about -- if certain groups are so focused on a drastic (and particularly an exponential) increase, we will remain at an impasse. You nor anyone else can guarantee network security under those conditions, so let's not get ahead of ourselves.

That people have such tunnel vision that the essential definition of scaling = increasing block size limit is part of the problem. Imagine that: a spam attack of dust transactions comes along, and everyone has their panties in a wad because they are terrified that there isn't enough room on the blockchain for the spam?

[ebliever]

Regarding the third point, for bitcoin to be an analog to gold we must keep in mind that gold is universally known and valued. If bitcoin prematurely choked off its own growth and abandoned efforts to mainstream it, I suspect it would slowly wither and die as competing altcoins rose to take its place as an everyday, mainstream cryptocurrency.

The current price of bitcoin is based largely on expectations of future growth. Choke off that growth and I suspect a large portion of its current valuation will evaporate.

It is also important that you reconsider this myth that capping Bitcoin's transactions is a cap on its userbase.

Bitcoin, as is, can provide a refuge for the wealth of ANY person on the planet. It can currently accommodate an infinite amount of capital.

The distinction is important because reality shows us that actual Bitcoin users are by and large not much interested in transacting or spending their coins. A great majority of the coins in existence have been and should continue to sit pretty in their cold wallets for years to come.

Why should we expect this to be different for future users? If you believe, much like I do, that the next trove of adopters is likely to be institutional investors with an interest in Bitcoin as a commodity/asset then why should we be worried so much with the system's transactions throughput? Do you expect the Winklevies to go on a shopping frenzy with their 100,000 coins? The analogy with gold is tired but it remains true: it should be expect that most bitcoins in circulation will be stored in digital vaults and shall remain untouched for a long period of time.

All of this is to say that you should stop focusing on "mainstream" users and what you assume their interest in Bitcoin will be. We should expect these to be last in line in your mass adoption scenario.

You make a valid point that a large number of users can still adopt bitcoin IF the transaction velocity of the money supply remains low enough. But this doesn't address my point that gold has a high value in part because everyone values it. To get to that point I think the average person needs to have some kind of tangible contact with bitcoin, obtaining and using it at least occasionally. And that would mean that mainstreaming of bitcoin as a payment processing system has to come first. The digital gold function (with the implication of high value) would derive from that success, IMHO.

I don't see how that is true. In fact I'm quite certain a majority of the biggest bitcoin owners have never really bothered using it as transactional currency aside from for some niche use case or outright curiosity.

Don't forget that we are not targetting the "average person". They are not the ones that will bring value to Bitcoin.

The digital gold function, as a store of wealth, is the primary natural function of Bitcoin. It is the first step toward any considerable rise in its currency application.

http://nakamotoinstitute.org/mempool/the-two-ideologies-in-bitcoin/

I agree that the largest holders are probably not using it in both ways. What I'm saying is that additional people won't come to value bitcoin as a store of value if they don't value it (or other crypto) for other reasons first. Bitcoin has been around now long enough that most people with disposable or investable income have at least heard of it. So why aren't they investing? We can give reasons relating to media coverage and technical squabbles and so forth, but in the end it boils down to a lack of personal familiarity with bitcoin. It's too much of an abstraction.

Can bitcoin maintain value or grow in value if the user base remains limited, comparable to or only modestly larger than today? Maybe, in the absence of competition and with sufficiently strong intensity of interest among the user base. But there is quite a lot of potential competition waiting in the wings from altcoins, that alone puts bitcoin (along with each of the alts) in a succeed-or-die situation. So holding at 1 MB blocks is risky - it only works if doing nothing (on this point) is really the best option. Given how much has changed with bitcoin use and scale since 1 MB blocks were implemented, I'm skeptical this will remain the case much longer.

And since most of the community has voiced a preference for larger block sizes, it is hard to believe that a decision to maintain the status quo would result in a retention of strong interest/support from the bitcoin community. Some would gravitate to alts, giving the best of them additional support, others would leave crypto. I don't see anyone going into bitcoin or increasing their stakes because of a decision to hold at 1 MB.

[adamstgBit]

Do you possess any technical credentials that can support this statement or should we just trust your gut?

ask Vitalik Buterin for some help in understanding the technicals.