Bear post of the Day

[adamstgBit]

most people use blockchain, most people would not notice there's been a fork.

they will notice a 10% drop in value and ask questions....

[johnyj]

@johnyj as I cross posted, is a fork serious chatter or purely hypothetical?

Check this list
https://en.bitcoin.it/wiki/Hardfork_Wishlist

[adamstgBit]

@johnyj as I cross posted, is a fork serious chatter or purely hypothetical?

Check this list
https://en.bitcoin.it/wiki/Hardfork_Wishlist

they seem like improvements to me...

what they should do is start a new experiment (read: start a brand new fork) why a hard fork?? why???

[ElectricMucus]

@johnyj as I cross posted, is a fork serious chatter or purely hypothetical?

Check this list
https://en.bitcoin.it/wiki/Hardfork_Wishlist

they seem like improvements to me...

what they should do is start a new experiment (read: start a brand new fork) why a hard fork?? why???

From what I can tell it's fear from completion from alternative cryptocurrencies that's driving this debate.

[ElectricMucus]

Due to popular demand todays bear post will address the current ongoing debate about the block size limit.
(Thanks for bringing that up guys!)

As a quick background each block has a hardcoded limit of 1MB. This is the done the same way as the block reward for instance, just a value in the code.
Recently a lot of voices raised their concern that the block size will not be enough in the future, (currently we only even come in the same magnitude because of satoshi dice and clones.)

I am strongly against this change since it is against the original intent, and I wouldn't consider it bitcoin anymore. Now the proponents of this change argue that the blocksize limit will compromise the usefulness of bitcoin.
Now the big question is usefulness for what?

After reading between the lines the answer becomes obvious: They are concerned that bitcoin would not be viewed as valuable anymore once the transaction costs aren't as cheap anymore and they may be right. But only from a theoretical not a practical perspective. For any realistic usage of bitcoin the block size limit is good enough, current estimations by gavin are 7 transactions per second.
This is imo a desperate reaction to the imminent bubble collapse, in theory to attract "big money" to bitcoin. On the other hand realistically, it will make people realize that Bitcoin is already near it's speculative value cap and exceeded it for the current time period.
But the bubble is in full gear so you might forgive them, look at this post in about a month and have a good laugh

[Melbustus]

I am strongly against this change since it is against the original intent, and I wouldn't consider it bitcoin anymore.

That's not a good reason. If anything, it simply borders on religious.

Now the proponents of this change argue that the blocksize limit will compromise the usefulness of bitcoin.
Now the big question is usefulness for what?

Micro-transactions, and more generally, lots of transactions. You obviously see this...

After reading between the lines the answer becomes obvious: They are concerned that bitcoin would not be viewed as valuable anymore once the transaction costs aren't as cheap anymore and they may be right. But only from a theoretical not a practical perspective. For any realistic usage of bitcoin the block size limit is good enough, current estimations by gavin are 7 transactions per second.

What?! How is 7 transactions per second in any way acceptable? Even in the scenario where bitcoin doesn't do micro-transactions well, 7 transactions per second represents awfully small thinking about the potential for bitcoin.

This is imo a desperate reaction to the imminent bubble collapse, in theory to attract "big money" to bitcoin. On the other hand realistically, it will make people realize that Bitcoin is already near it's market cap and exceeded it during the current time period.
But the bubble is in full gear so you might forgive them, look at this post in about a month and have a good laugh

This has nothing to do with bubble or no bubble.

For the record, I've only recently educated myself on the block-size debate, so if I'm missing some finer (or even obvious) points, please fill me in!

[Chalkbot]

Are the primary concerns with block size just that transactions will take longer? If yes, I'd be curious to know what percentage of the current transactions are services like Satoshi dice? If it is a large number, what makes those fearful of reaching the cap think those services will still have the same viability if it takes forever for the transactions? It seems like it's a self-correcting system, but I might just be un-informed on this particular topic.

I mean, the block size needs to be low so that a cap is indeed reachable in order to make the maintaining the network a profitable endeavor, right?

[Melbustus]

...
I mean, the block size needs to be low so that a cap is indeed reachable in order to make the maintaining the network a profitable endeavor, right?

Yes, it's a balance. I contend that it shouldn't be absurdly low, which 1MB will soon become.

[Chalkbot]

...
I mean, the block size needs to be low so that a cap is indeed reachable in order to make the maintaining the network a profitable endeavor, right?

Yes, it's a balance. I contend that it shouldn't be absurdly low, which 1MB will soon become.

Okay, can I get your opinion on Satoshi Dice? Good or bad for bitcoin? How do you think the current cap will affect their business model?

[ElectricMucus]

The main reason why I am against this change I have not mentioned. (It is not directly related to speculation about the bitcoin price itself and would belong to the mining subforum but in the spirit of rigor here it is)
Another concern about raising the block size limit is that it is unfair towards miners. If the block size is increased every time it comes close to the limit there won't be ever a real transaction market since it would mean practically unlimited supply. It's a classical bait and switch game.
If the block size limit is allowed to be reached zero fee transactions will be squeezed out which is a good thing for a sustainable mining economy.

Problem is most investors don't want sustainability, they just want to get rich quick....

[Chalkbot]

I'm finding myself agreeing with what ElectricMucus is saying, which pretty much never happens. This makes me feel like I should probably get better educated on the topic before I can really contribute in a meaningful way.

[Namworld]

While I think the blocksize current limit is acceptable for the foreseeable future, I believe if Bitcoin gets any kind of adoption, the increased value of BTC coupled with the transaction volume will require higher limits if we are not to limit Bitcoins to large transactions only, that is, if Bitcoin ever makes it to that point.

For now, it should be sufficient as is for a few years at minimum.

[CurbsideProphet]

Hi ElectricMucus, long time no chat.

I would be very very surprised if BTC/USD ratio gets under 20$ ever !

According to my tea leaves, there is a good chance the price will peak soon around $40 and drop to the August price range, perhaps in the teens. After climbing above $20 again, I think you are right, it will never drop below $20 again. Or so says the good oolong.

translation: i think bitcoin is over priced right now and should be in the teens... But it will go up Up UP b4 the market crashes down down down!

I say no.
everyone can see what you see... bitcoin is over priced because the market went a bit nutty... No it will not go any higher... the market might go crazy from time to time, but MOST of the time it does want it does best, and that is to find the true value.

 

   ok NOW it will not go any higher 

Eventually you'll be right.  Even a broken clock is right twice a day 

[Melbustus]

...
I mean, the block size needs to be low so that a cap is indeed reachable in order to make the maintaining the network a profitable endeavor, right?

Yes, it's a balance. I contend that it shouldn't be absurdly low, which 1MB will soon become.

Okay, can I get your opinion on Satoshi Dice? Good or bad for bitcoin? How do you think the current cap will affect their business model?

Good for bitcoin. It forces treatment of scaling issues sooner than otherwise would've happened, which is good. It also enables a completely new type of product (provably fair gambling), which I hope is the first in a long line of never-before-possible products.

[Melbustus]

The main reason why I am against this change I have not mentioned. (It is not directly related to speculation about the bitcoin price itself and would belong to the mining subforum but in the spirit of rigor here it is)
Another concern about raising the block size limit is that it is unfair towards miners. If the block size is increased every time it comes close to the limit there won't be ever a real transaction market since it would mean practically unlimited supply. It's a classical bait and switch game.
If the block size limit is allowed to be reached zero fee transactions will be squeezed out which is a good thing for a sustainable mining economy.

Problem is most investors don't want sustainability, they just want to get rich quick....

This is certainly a valid concern. I agree that the blocksize shouldn't be raised such that *all* transactions can be included and fees go to zero. As I noted above, it's a balance... I think keeping it at 1MB forever, though, tilts things way in the other direction. Fees would be high enough that they'd kill some of the key innovative utility that bitcoin theoretically offers.

This is somewhat arbitrary, but what about doubling the blocksize every time the block-reward is halved? This would be slower than keeping pace with Moore's law, but that's probably ok. This seems like one of the simplest dynamic ways to treat the issue, while trying to maintain a balance. (sidenote: I'm sure plenty of other people have suggested this; like I said above, I've by no means read through all the discussion yet).

[ElectricMucus]

The main reason why I am against this change I have not mentioned. (It is not directly related to speculation about the bitcoin price itself and would belong to the mining subforum but in the spirit of rigor here it is)
Another concern about raising the block size limit is that it is unfair towards miners. If the block size is increased every time it comes close to the limit there won't be ever a real transaction market since it would mean practically unlimited supply. It's a classical bait and switch game.
If the block size limit is allowed to be reached zero fee transactions will be squeezed out which is a good thing for a sustainable mining economy.

Problem is most investors don't want sustainability, they just want to get rich quick....

This is certainly a valid concern. I agree that the blocksize shouldn't be raised such that *all* transactions can be included and fees go to zero. As I noted above, it's a balance... I think keeping it at 1MB forever, though, tilts things way in the other direction. Fees would be high enough that they'd kill some of the key innovative utility that bitcoin theoretically offers.

This is somewhat arbitrary, but what about doubling the blocksize every time the block-reward is halved? This would be slower than keeping pace with Moore's law, but that's probably ok. This seems like one of the simplest dynamic ways to treat the issue, while trying to maintain a balance. (sidenote: I'm sure plenty of other people have suggested this; like I said above, I've by no means read through all the discussion yet).

I might be willing to accept some of a compromise but this is too much. At first moores law and related laws will end. Once they do the balance deteriorates exponentially. You would be increasing the slope one exponent basically. from n^2 to n^3 for ex and would exeed moores law.
Also this would make a ever growing economy necessary which is the fundamental flaw in current inflationary environments. Bitcoin is in it's design a steady state model and the fixed block size is there to ensure that bitcoin evolves into a steady state economy. If you ask me this was done on purpose.

[notig]

From what I've read... the "intended design" of the blocksize not being raised isn't true.  For those who want to keep it low......... they are probably mining litecoins as we speak because ultimately bitcoin will be relegated to very expensive transactions only (Like more than 20 dollars just for a transaction)or total failure . Bitcoin will become just a way to move huge amounts of money and that's it with the "hope" that bitcoin clearing houses(or the litecoins they are currently mining) step in and perform smaller transactions for us off the block chain. This is all argued because it will somehow prevent centralization. See how preposterous that is? Handicapping the bitcoin network and forcing people to use other methods for normal day to day transactions is going to "prevent centralization" . If by preventing centralization they mean preventing the use of bitcoin then sure. It's ridiculous. Thank god it's only a fringe minority of people that talk about it.

[ElectricMucus]

Uh hating on Litecoin again? This thread is about Bitcoin, please stay on topic kthx.

[RodeoX]

My bear post for the day.

"Ruawwwwar grrrahr" 

[ElectricMucus]

Today we have the current state of ASIC:

BFL claims to have chips in the work, and had a visitor to inspect their boxes with fans. Probability of a total fuckup: high
AVALON, has 2 fully confirmed units shipped 2 others with a hint and several? in China of which they aren't telling us anything. Probability of a total fuckup: low
ASICMINER has raised a substantial hashrate, but nothing so out of the ordinary that they should be taken for granted, unloading of shares by IPO investors has begun. Probabilty of a total fuckup: unknown

I always was one of the harshest skeptics in regards to ASICs, right now the consensus is very optimistic on the forum. I will write more on this as it unfolds lets just say I smell something in the air.

What I am fairly certain of is that all ASIC companies have invested a large part of their preorder money in BTC upto the point where they are entirely invested in it. So even under the most optimistic scenario of no fuckups there will be serious profit taking along the way.

tl;dr this rally is an ASIC bubble.