Could the Current Block Size Sustain the next Bubble?

[Enjorlas]

Just like the title says. During the last all time high, we were having 50,000-70,000 transactions per day which is well within the current limits of the block size. But recently, we have been seeing ranges in the 190,000-220,000 range. Will the next bubble be able to sustain the daily transactions?

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[windpath]

Just like the title says. During the last all time high, we were having 50,000-70,000 transactions per day which is well within the current limits of the block size. But recently, we have been seeing ranges in the 190,000-220,000 range. Will the next bubble be able to sustain the daily transactions?

If nothing changes, then no.

TX fees would spike and lots of transactions would just sit in limbo until they drop out of the mempool, only to be re-broadcast and start the limbo process again.

[Lauda]

If nothing changes, then no.

TX fees would spike and lots of transactions would just sit in limbo until they drop out of the mempool, only to be re-broadcast and start the limbo process again.

You can't really know that. This depends on a lot of factors though. Just how big would this bubble be? How many more transactions would we be having? You also forget to think about the amount of spam transactions of today.

Just like the title says. During the last all time high, we were having 50,000-70,000 transactions per day which is well within the current limits of the block size. But recently, we have been seeing ranges in the 190,000-220,000 range. Will the next bubble be able to sustain the daily transactions?

It depends on when this happens and just how big the increase is. Hopefully (nobody can know this) the increase that we're going to have with SegWit is going to be enough for 2016.

[BitUsher]

If a transaction fee event occurred and tx fees were raised than more tx would be handled off the chain as a temporary buffer. Bitcoin will be fine either way.

[windpath]

If a transaction fee event occurred and tx fees were raised than more tx would be handled off the chain as a temporary buffer. Bitcoin will be fine either way.

What off-chain solution would they be handled by today?

[BitUsher]

If a transaction fee event occurred and tx fees were raised than more tx would be handled off the chain as a temporary buffer. Bitcoin will be fine either way.

What off-chain solution would they be handled by today?

wallets like - coinbase, circle, ect...
exchanges like - bitstamp, kraken, bitx , bitfinix, ect...
micropayment channels like - strawpay, changetip, protip, ect...

That is what is working today and I am sure that a tx fee event will spur other solutions like decentralized payment channels (LN)...

[countryfree]

Will the next bubble be able to sustain the daily transactions?

That's the big question, and nobody has the answer, as there are too many factors to make forecasts. My belief is that as the problem gets more acute, the community will be more willing to find a solution. Then, besides the block size issue, there could small "step-solutions" like raising the minimum amount to make a transaction ((0.05 BTC could become the minimum) or raising fees.

[windpath]

If a transaction fee event occurred and tx fees were raised than more tx would be handled off the chain as a temporary buffer. Bitcoin will be fine either way.

What off-chain solution would they be handled by today?

wallets like - coinbase, circle, ect...
exchanges like - bitstamp, kraken, bitx , bitfinix, ect...
micropayment channels like - strawpay, changetip, protip, ect...

That is what is working today and I am sure that a tx fee event will spur other solutions like decentralized payment channels (LN)...

With the exception of the potential of LN, sounds like a bunch of trusted 3rd parties to me, kind of misses the whole point of "be your own bank"...

[BitUsher]

With the exception of the potential of LN, sounds like a bunch of trusted 3rd parties to me, kind of misses the whole point of "be your own bank"...

Agreed... that is why I said ---

If a transaction fee event occurred and tx fees were raised than more tx would be handled off the chain as a temporary buffer. Bitcoin will be fine either way.

Indicating that the market could buffer the overflow at the exchange of relying on insured and trusted third parties for moments during high tx and to give developers more breathing room for other scaling proposals or payment channels like LN.

The point is, it won't be the end of the world. People buying drugs on the darkmarket will pay 20 pennies instead of 4 per tx and others will continue to pay 0.

The blockchain will be sustained because wallets are already incorporating flexible fees. Bitcoin will be fine if it is 1MB , 1.75MB or 8MB capacity. There are just some tradeoffs with each/

[johnyj]

In my opinion, all the solutions either on chain or off chain are equally working, because majority of the new users entering a bubble just for speculation, they are not aware of the fundamental difference between on chain transactions and off chain transactions. In fact majority of the transactions is already happen off chain at exchanges, just compare the daily transaction volume on exchanges and blockchain to see the difference

Based on this statistic from Federal Reserve, the number of low value transactions will decrease during a bubble, so a higher fee will not make a huge impact

[johnyj]

With the exception of the potential of LN, sounds like a bunch of trusted 3rd parties to me, kind of misses the whole point of "be your own bank"...

Unless at money creation level, it is not necessary to exaggerate the importance of 100% trust-less

For example, majority of the miners join a mining pool, which is a centralized organization. These organizations are not trust-less (I had 1 bitcoin lost during the sudden disappear of 50BTC mining pool, and even more litecoin loss at some other disappeared mining pools), but miners still use their service, why? Because they reduce lots of operational cost, and the risk involved can be limited by doing daily withdraw. If they went down suddenly, then maybe a few day's mining loss, but it's much easier to use their service in stead of running solo mine at home or setup a P2Pool mining with extensive amount of setup and maintenance of a full node

Similarly, if users do not have enough IT expertise to handle bitcoin securely by themselves, they would prefer to use some service provider, with his own acceptable risk management strategy. I guess majority of the chinese users are using exchanges and web wallets since they just speculate on the price, like trading on FOREX margin trading, they never really hold any USD or EUR

[windpath]

All excellent and valid points... Was not aware of the low-value tx volume decreasing during a bubble, thanks for sharing.

That being said I think preserving the trust-less, un-censorable nature of Bitcoin, beyond the aspects of money creation is highly important.

I'm of the mind that if you do not control the private keys then you don't own bitcoin.

You may have a promise from a 3rd party to allow you to send X amount that they control (if their terms don't change, and you comply with KYC/AML, and they don't do a GOX and vanish, and they don't get robbed, and their government does not outlaw bitcoin, etc...), but they own the bitcoin, not you.

I work and live within the "traditional" system of banking/trust in the US, but when it comes to bitcoin, I am my own bank, and I thoroughly enjoy the piece of mind and security that affords.

Also, you'll note that I do mine on P2Pool

[rubygon]

It will definitely sustain with no doubt at all. The bitcoin blockchain has the capability to sustain k's of transactions. As number of nodes are increasing day by day, whatever bubble may come, these nodes make the chain sustainable. Seems you're too much worried about bubble.

[pereira4]

If a transaction fee event occurred and tx fees were raised than more tx would be handled off the chain as a temporary buffer. Bitcoin will be fine either way.

What off-chain solution would they be handled by today?

wallets like - coinbase, circle, ect...
exchanges like - bitstamp, kraken, bitx , bitfinix, ect...
micropayment channels like - strawpay, changetip, protip, ect...

That is what is working today and I am sure that a tx fee event will spur other solutions like decentralized payment channels (LN)...

With the exception of the potential of LN, sounds like a bunch of trusted 3rd parties to me, kind of misses the whole point of "be your own bank"...

Well, what's the point of "be your own bank" when block sizes will be so big that you have to trust on some big datacenters running the nodes and not screwing up things? LN is a way more decentralized model than big blocks, so stop dreaming about Bitcoin scaling worlwide without LN cause it ain't happening.

[johnyj]

Also, you'll note that I do mine on P2Pool

I'm sure you are one of those IT experts that does not belong to majority. For majority of the people I taught to use bitcoin, some of them even have doctor degree or working as professor, none of them are IT illiterate enough to use somthing more complex than an iphone. A private key? It will take them years if not decades to get to that  

[windpath]

Also, you'll note that I do mine on P2Pool

I'm sure you are one of those IT experts that does not belong to majority. For majority of the people I taught to use bitcoin, some of them even have doctor degree or working as professor, none of them are IT illiterate enough to use somthing more complex than an iphone. A private key? It will take them years if not decades to get to that  

Fair enough, however there are already fantastic apps, that have been proven safe and reliable, that allow the "average" user to keep their own keys.

For those on iPhone http://breadwallet.com

[johnyj]

Also, you'll note that I do mine on P2Pool

I'm sure you are one of those IT experts that does not belong to majority. For majority of the people I taught to use bitcoin, some of them even have doctor degree or working as professor, none of them are IT illiterate enough to use somthing more complex than an iphone. A private key? It will take them years if not decades to get to that  

Fair enough, however there are already fantastic apps, that have been proven safe and reliable, that allow the "average" user to keep their own keys.

For those on iPhone http://breadwallet.com

If they have to download some thing from the internet, then it means they have to trust the function and security of that app, so they need some trustworthy large company/bank behind it (They don't have the ability to inspect the source code). From majority of people's of view, trust an app is more dangerous than trust a bank, similar to people do not store large amount of gold at home, they put them into a security box in the bank instead.

I really see there is a need for a bitcoin storage service similar to a bank vault, but unless it is protected by law enforcement, it will not work. I guess bitcoin is only suitable for IT experts, and they in turn handle the security for their friends/family members

[windpath]

Also, you'll note that I do mine on P2Pool

I'm sure you are one of those IT experts that does not belong to majority. For majority of the people I taught to use bitcoin, some of them even have doctor degree or working as professor, none of them are IT illiterate enough to use somthing more complex than an iphone. A private key? It will take them years if not decades to get to that  

Fair enough, however there are already fantastic apps, that have been proven safe and reliable, that allow the "average" user to keep their own keys.

For those on iPhone http://breadwallet.com

If they have to download some thing from the internet, then it means they have to trust the function and security of that app, so they need some trustworthy large company/bank behind it (They don't have the ability to inspect the source code). From majority of people's of view, trust an app is more dangerous than trust a bank, similar to people do not store large amount of gold at home, they put them into a security box in the bank instead.

I really see there is a need for a bitcoin storage service similar to a bank vault, but unless it is protected by law enforcement, it will not work. I guess bitcoin is only suitable for IT experts, and they in turn handle the security for their friends/family members

It's downloaded from the Apple app store which is a "closed garden" maintained by a "trustworthy large company", the iPhone is arguably the most secure mass-market computing device on the planet. And Breadwallet is open source, free and peer reviewed https://github.com/breadwallet/breadwallet

 Seems to meet all your criteria...

[btc-surf]

Do you have the patience to wait till your mud settles and the water is clear?     
Can you remain unmoving till the right action arises by itself?
I think this is the way think in this case, no need to blow the bubble larger...