Will you keep block size at 1MB if that makes bitcoin value rise?

[johnyj]

Of course keeping the block size at 1MB will make the transaction more and more expensive, but then people will ask: What makes this system more and more expensive to do transaction? Then after a little research they will understand that this is due to a designed limited transaction capacity to ensure the agility and decentralization of the system. However, a rising fee is a good indicator of increased transaction demand. So when they see the fee is rising, they will understand the usage is higher and the demand is higher, they will foresee a rise in price due to higher demand and buy more bitcoins, so the bitcoin price rises. This is similar to: When the miners see the mining difficulty has gone up, they don't quit mining but invest in new generation miners instead

My observation is: There is almost nothing in this world becomes more valuable because it is cheaper and cheaper to use. Going the cheap route usually result in the decrease in value

Just look at those capital goods that have a high transaction cost: Gold, Stocks, Real estate ... They are never meant to be cheap to transact but still gained higher and higher value over time. On the other hand, those things that have cheaper and cheaper running cost, like car, tv, pc, mobile phone etc... they all goes down in value over time

I always think that low fee is a marketing trick from early adopters to attract those who don't really understand bitcoin and dump the coins on them. But to get true believers on board, they should be attracted to bitcoin by their own research and understanding, not by some marketing campaign. The hype caused by such campaign is always short lived. I'm quite sure the bitcoin hardcore supporter did not come to bitcoin because of its low fee

If someone can show an example that something's value goes up with lower and lower usage cost, please share it

[oblivi]

Not because of the price would go up or down, but because decentralization of nodes is the first priority by anyone that actually cares about Bitcoin surviving long term.

They are raising the limit to 2 MB in April anyway so this should make noobs STFU for a while.

[Alley]

Not because of the price would go up or down, but because decentralization of nodes is the first priority by anyone that actually cares about Bitcoin surviving long term.

They are raising the limit to 2 MB in April anyway so this should make noobs STFU for a while.

Who is raising limit?  Core?

[jonald_fyookball]

Geez how thick are you? Price is tanking because hearn just revealed bitcoin isnt scaling.  Unbelievable.

[Amph]

Not because of the price would go up or down, but because decentralization of nodes is the first priority by anyone that actually cares about Bitcoin surviving long term.

They are raising the limit to 2 MB in April anyway so this should make noobs STFU for a while.

Who is raising limit?  Core?

other dev, those that remained there supporting the real bitcoin, there is a proposal for 2mb, in different way

segregated witness or directly upgrade it to 2mb, then probably go to the sidechain route


OP, miners don't really need to increase fee, if the value is increased, so you can fix this in three ways, increase fee, increase the demand(not directly possible), increase the block limit

one of this must be increased in the end, there is no other way around

[BlindMayorBitcorn]

<snip>They are raising the limit to 2 MB in April anyway</snip>

I read the same thing. Lost the sauce tho.

[johnyj]

Geez how thick are you? Price is tanking because hearn just revealed bitcoin isnt scaling.  Unbelievable.

I don't see any direct relationship between price and Hearn, it is just time to make some consolidation after we had so strong run during past 2 months, the resistance at 450 is so strong that now whales need to wash the market for a while to shake out the weak hands

[BlindMayorBitcorn]

Geez how thick are you? Price is tanking because hearn just revealed bitcoin isnt scaling.  Unbelievable.

I don't see any direct relationship between price and Hearn, it is just time to make some consolidation after we had so strong run during past 2 months, the resistance at 450 is so strong that now whales need to wash the market for a while to shake out the weak hands

Hearn dumped, then he told Wall Street he dumped, then Wall Street dumped, then China saw Wall Street dump, then China dumped, and now China is dumping. 

[LiteCoinGuy]

2MB will make it rise, not artificial 1MB. in the long run we need some flex-cap.

[johnyj]

2MB will make it rise, not artificial 1MB. in the long run we need some flex-cap.

I understand that the thinking behind 2MB is following the initial trajectory, and as long as technology allow, the block size can be increased at a controlled pace. But as a software, the blockchain database is already too big. Nothing grows at exponential rate forever, and network bandwidth and CPU speed have not increased significantly during the latest decade. So if you sooner or later will hit a technical limit, then why don't limit it at an early phase when you still can keep the database growth small?

Artificial limit typically is used to provide better user experience. All modern cars have artificial limit for its torque output, so the torque is a constant level regardless of engine RPM, thus the driver can experience smooth acceleration of the car. Cars can all provide larger output than their stock performance through chip upgrade to remove this limit, but in that case the car output will vary a lot at different RPM, gives worse user experience and reduce the engine life

The fundamental question is, will cheap transactions increase bitcoin's value? This is the same as: What is the reason that people come to bitcoin? I don't think they come to bitcoin to do cheap transactions, anyway there are many 0 fee instant confirmed mobile payment solutions out there already, why bother using bitcoin when you need to exchange and pay a lot of fee along the way to spend

[jonald_fyookball]

Geez how thick are you? Price is tanking because hearn just revealed bitcoin isnt scaling.  Unbelievable.

I don't see any direct relationship between price and Hearn, it is just time to make some consolidation after we had so strong run during past 2 months, the resistance at 450 is so strong that now whales need to wash the market for a while to shake out the weak hands

So the fifteen percent drop on the same day as hearns post was pure coincidence?

[Matias]

2MB will make it rise, not artificial 1MB. in the long run we need some flex-cap.

I understand that the thinking behind 2MB is following the initial trajectory, and as long as technology allow, the block size can be increased at a controlled pace. But as a software, the blockchain database is already too big. Nothing grows at exponential rate forever, and network bandwidth and CPU speed has not increased significantly during the latest decade. So if you sooner or later will hit a technical limit, then why don't limit it at an early phase when you still can keep the database growth small?

Forgive me my ignorance,  but why increasing block size increases database? Won't same number of transactions need same total space regardless of block size?

[johnyj]

Geez how thick are you? Price is tanking because hearn just revealed bitcoin isnt scaling.  Unbelievable.

I don't see any direct relationship between price and Hearn, it is just time to make some consolidation after we had so strong run during past 2 months, the resistance at 450 is so strong that now whales need to wash the market for a while to shake out the weak hands

So the fifteen percent drop on the same day as hearns post was pure coincidence?

Almost anything's value was crashed around the world during Friday, stock market, oil, etc... this is just anticipation of more rate hike from FED, not because of Hearn  

[johnyj]

2MB will make it rise, not artificial 1MB. in the long run we need some flex-cap.

I understand that the thinking behind 2MB is following the initial trajectory, and as long as technology allow, the block size can be increased at a controlled pace. But as a software, the blockchain database is already too big. Nothing grows at exponential rate forever, and network bandwidth and CPU speed has not increased significantly during the latest decade. So if you sooner or later will hit a technical limit, then why don't limit it at an early phase when you still can keep the database growth small?

Forgive me my ignorance,  but why increasing block size increases database? Won't same number of transactions need same total space regardless of block size?

When your transaction capacity is limited, you will plan accordingly. For example, if your bank allow you to do only one transaction per day, or 0 transaction during weekends, then you will combine all those small transactions into a large one, thus reduce the amount of transactions. In fact, behind the scene, banks combine millions of transactions daily into one single transaction to dramatically reduce the amount of transaction data

[YarkoL]

Suppose I own a building and have some tenants living there.
I know there is a demand for housing, so that if I renovated the building to
accommodate 2x of the number of tenants, I'd still have most of the rooms
filled all the time.

Now which one would make me more attractive to prospective buyers of
my building?
a) enlarge the building and get 2 times more rent
b) do nothing but charge 2 times more rent

Increase in rent is the same, so you might think that by raising
the rent, you'll get the same result without having to do anything.
But buyers don't just look at the figures alone.

They use them as starting point and look at the fundamentals as well.
If they learn that you're just overcharging your tenants, well...

So with bitcoin, once ordinary people start to see with their own eyes that
BTC is accepted in many places, there are easy-to-use wallets
available, burgeoning Bitcoin-based businesses and good steady flow of
transactions then BTC price will stabilize.

Whereas the other option means that you check up your full node on Raspberry,
issue estimatefee on the console and see that the silkroad crowd
desperate for their fix are really getting fleeced today... so hey, things looking
good!  

[johnyj]

Suppose I own a building and have some tenants living there.
I know there is a demand for housing, so that if I renovated the building to
accommodate 2x of the number of tenants, I'd still have most of the rooms
filled all the time.

Now which one would make me more attractive to prospective buyers of
my building?
a) enlarge the building and get 2 times more rent
b) do nothing but charge 2 times more rent

Increase in rent is the same, so you might think that by raising
the rent, you'll get the same result without having to do anything.
But buyers don't just look at the figures alone.

They use them as starting point and look at the fundamentals as well.
If they learn that you're just overcharging your tenants, well...

So with bitcoin, once ordinary people start to see with their own eyes that
BTC is accepted in many places, there are easy-to-use wallets
available, burgeoning Bitcoin-based businesses and good steady flow of
transactions then BTC price will stabilize.

Whereas the other option means that you check up your full node on Raspberry,
issue estimatefee on the console and see that the silkroad crowd
desperate for their fix are really getting fleeced today... so hey, things looking
good!  

Thanks! I like your creative thinking very much. Let me explain my view

If you consider bitcoin to be that building, then the amount of building you can build is limited at 21 million, e.g. you can not increase the amount of building at all. (We are interested about the value of bitcoin, not the value of blockspace). So when you get more and more tenants while still have the same amount of building, the value of building will rise for sure, that's why bitcoin's value exploded

From the beginning, few people are living in the building so it costs little to move (fee). And later with more and more tenants lived in those building, the traffic increases dramatically, and the infrastructure of the city can not keep up with the exponential growth of the tenants. As a result, many people will not reach their target in one hour or more by car (use blockchain to do payment), so they would prefer to use public transportation, which is a specially built transportation rail for large amount of people to travel cheaply (clearing based solutions)

This is basically what happens in those large cities with high house price. Being able to travel cheaply is not a reason for a high house price. And typically if it costs little to travel in a city, the house price of that city is low. The more expensive the housing price is, the more expensive the local traffic become, since the tenants are richer and can afford more

From this point of view, limiting the block size at 1MB sounds like the government refuse to expand the existing road infrastructure and charge a high road tax to force majority of people to use public transportation, which is not very comfortable for the citizen. But this is really happening around the world right now: This year my city just implemented a very heavy tax on the road, and in China they even ban your car from being used during a certain day of the week. Governments are also expanding road infrastructure, but typically a road project would take almost a decade to finish and it does not increase the capacity by more than a few percent

[franky1]

Suppose I own a building and have some tenants living there.
I know there is a demand for housing, so that if I renovated the building to
accommodate 2x of the number of tenants, I'd still have most of the rooms
filled all the time.

Now which one would make me more attractive to prospective buyers of
my building?
a) enlarge the building and get 2 times more rent
b) do nothing but charge 2 times more rent

Increase in rent is the same, so you might think that by raising
the rent, you'll get the same result without having to do anything.
But buyers don't just look at the figures alone.

They use them as starting point and look at the fundamentals as well.
If they learn that you're just overcharging your tenants, well...

So with bitcoin, once ordinary people start to see with their own eyes that
BTC is accepted in many places, there are easy-to-use wallets
available, burgeoning Bitcoin-based businesses and good steady flow of
transactions then BTC price will stabilize.

Whereas the other option means that you check up your full node on Raspberry,
issue estimatefee on the console and see that the silkroad crowd
desperate for their fix are really getting fleeced today... so hey, things looking
good! 

Thanks! I like your creative thinking very much. Let me explain my view

If you consider bitcoin to be that building, then the amount of building you can build is limited at 21 million, e.g. you can not increase the amount of building at all. (We are interested about the value of bitcoin, not the value of blockspace). So when you get more and more tenants while still have the same amount of building, the value of building will rise for sure, that's why bitcoin's value exploded

but if it starts to cost $2 just to put your key in the door, then $2 to sit on the sofa for 10 minutes. then $2 to watch tv, because your landlord has gone for a high fee model.. people wont want to use that type of building..

they would prefer to buy an apartment, have no fee's and know in a few years they will get positive ROI.
so the downside of limiting the amount of apartments per building is not that the value of the apartment increases.. but the cost of living/using it does as the greedy landlords prefer to charge high fee's rather than helping increase the asset value.

From the beginning, few people are living in the building so it costs little to move (fee). And later with more and more tenants lived in those building, the traffic increases dramatically, and the infrastructure of the city can not keep up with the exponential growth of the tenants. As a result, many people will not reach their target in one hour or more by car (use blockchain to do payment), so they would prefer to use public transportation, which is a specially built transportation rail for large amount of people to travel cheaply (clearing based solutions)

again people would prefer a no fee model where they bought the car and apartment outright. afterall you get no ROI on paying for a bus ticket.

though bitcoin has demand. miners are 3 decades too soon trying to push for a pay to use method, and devaluing the asset value by not demanding high purchase prices, and instead selling small chunks of the asset as soon as they get it at whatever price they can get.

This is basically what happens in those large cities with high house price. Being able to travel cheaply is not a reason for a high house price. And typically if it costs little to travel in a city, the house price of that city is low. The more expensive the housing price is, the more expensive the local traffic become, since the tenants are richer and can afford more

um no..
most states have restrictions on public transport fee's.. so it doesnt matter what demograph of the neighbourhood the taxi/bus travels too, the fee is the same.

From this point of view, limiting the block size at 1MB sounds like the government refuse to expand the existing road infrastructure and charge a high road tax to force majority of people to use public transportation, which is not very comfortable for the citizen. But this is really happening around the world right now: This year my city just implemented a very heavy tax on the road, and in China they even ban your car from being used during a certain day of the week. Governments are also expanding road infrastructure, but typically a road project would take almost a decade to finish and it does not increase the capacity by more than a few percent

increasing a toll does not help people value that road any more. does not make more people want or desire to use it. but adding a new lane would

[jonald_fyookball]

Geez how thick are you? Price is tanking because hearn just revealed bitcoin isnt scaling.  Unbelievable.

I don't see any direct relationship between price and Hearn, it is just time to make some consolidation after we had so strong run during past 2 months, the resistance at 450 is so strong that now whales need to wash the market for a while to shake out the weak hands

So the fifteen percent drop on the same day as hearns post was pure coincidence?

Almost anything's value was crashed around the world during Friday, stock market, oil, etc... this is just anticipation of more rate hike from FED, not because of Hearn  

The FED rate has more correlation to Bitcoin price than one of its core figures quitting and releasing an expose of Bitcoin's major issues? 

You are delusional.

[johnyj]

Geez how thick are you? Price is tanking because hearn just revealed bitcoin isnt scaling.  Unbelievable.

I don't see any direct relationship between price and Hearn, it is just time to make some consolidation after we had so strong run during past 2 months, the resistance at 450 is so strong that now whales need to wash the market for a while to shake out the weak hands

So the fifteen percent drop on the same day as hearns post was pure coincidence?

Almost anything's value was crashed around the world during Friday, stock market, oil, etc... this is just anticipation of more rate hike from FED, not because of Hearn  

The FED rate has more correlation to Bitcoin price than one of its core figures quitting and releasing an expose of Bitcoin's major issues? 

You are delusional.

Both of them have no direct relation to bitcoin price, otherwise Hearn will be able to short bitcoin and make a huge profit if his words can move the market

[johnyj]

From the beginning, few people are living in the building so it costs little to move (fee). And later with more and more tenants lived in those building, the traffic increases dramatically, and the infrastructure of the city can not keep up with the exponential growth of the tenants. As a result, many people will not reach their target in one hour or more by car (use blockchain to do payment), so they would prefer to use public transportation, which is a specially built transportation rail for large amount of people to travel cheaply (clearing based solutions)

again people would prefer a no fee model where they bought the car and apartment outright. afterall you get no ROI on paying for a bus ticket.

This is basically what happens in those large cities with high house price. Being able to travel cheaply is not a reason for a high house price. And typically if it costs little to travel in a city, the house price of that city is low. The more expensive the housing price is, the more expensive the local traffic become, since the tenants are richer and can afford more

um no..
most states have restrictions on public transport fee's.. so it doesnt matter what demograph of the neighbourhood the taxi/bus travels too, the fee is the same.

In reality, road infrastructure is covered by the tax you turned into government which is around 50% of the gas price at where I live, so it is a very high cost without any ROI, but people still value that to be worthy. Everyone knows that driving a car is an expensive thing, and it often delays due to traffic jam, but they still drive a car due to the flexibility and freedom it brings. Government can set a low price for public transportation, since they have economy of scale similar to a clearing based solution

So I think a mixture of both public and private transportation is also healthy in bitcoin ecosystem: People who want low fee will seek centralized service hub and those who want to do transaction by themselves will have to pay a high fee

From this point of view, limiting the block size at 1MB sounds like the government refuse to expand the existing road infrastructure and charge a high road tax to force majority of people to use public transportation, which is not very comfortable for the citizen. But this is really happening around the world right now: This year my city just implemented a very heavy tax on the road, and in China they even ban your car from being used during a certain day of the week. Governments are also expanding road infrastructure, but typically a road project would take almost a decade to finish and it does not increase the capacity by more than a few percent

increasing a toll does not help people value that road any more. does not make more people want or desire to use it. but adding a new lane would

But increasing a toll will not impact the housing price of a city, as far as I can see

If it is so easy to add a new lane, then why are we seeing higher and higher toll and even the ban of using car under certain day? The infrastructure are difficult to upgrade, it can not follow the growth speed of car users

The road is always a cost that you must pay to use, it is just not that visible. The best way is to work at home (no physical move of the person, equal to clearing based solutions to do transaction: no real move of the bitcoin) thus the transaction cost do not impact you