review of proposals for adaptive maximum block size

[Sukrim]

So it'd be like the search engine circle-jerk back when the most relevevant possible page, in the engine's eyes, was its own output.

So we got what, a big three in each part of the world?

Modula the fact that blocks are not cultural/linguistic the way web pages are, so maybe the big three can be the same big three world-wide, no "you don't even speak our language, you don't understand the nuances of our pages, thus your searches suck" effect helping very-different cultures to prop up a big one (do they even get to have a big three, or are the regions where the big three aren't the biggest only have a big one of their own not their own whole big three?)

Way to not centralise. Are the big number two and big number three still shrinking  the big one or are they becoming more equal?

-MarkM-

I'm not sure what you try to tell me about block size with this...? If that is a (bad) attempt at sarcasm, please keep that out of the debate and post some clear arguments/reasons. As far as I get it, you're saying that there is a threat of centralisation and 3 miners competing in an endgame scenario? Sorry, but it is really not clear to me what point you want to get across.

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[TierNolan]

Even if miners only can ignore transactions, they will do so - including more transactions means slower block propagation times and as already said in a different thread, bandwidth is still a limiting factor in an unlimited/virtually unlimited block size scenario.

The thing is that hashing adds directly to proof of work.  A miner's costs become proportional to his hash power.  There is an economy of scale here.  If the optimal point is at 0.01% of the total hashing power, then things stay distributed.  If economies of scale continue so that a miner with 90% of the hash power is more efficient than one with 10% of the hashing power, then you end up with a "natural" monopoly.

A situation where things might end up as a natural monopoly must be avoided.

If miners become bandwidth limited, then an entirely new dynamic takes over.

This means that the primary cost for a miner is bandwidth.  In this situation, a miner's costs are not proportional to his hashing power.  A miner with 90% of the market only needs to pay for bandwidth once and gets 90% of the fees, while a miner with 10% of the hashing power also pays the same, but only gets 10% of the fees.  This puts the 10% guy out of business.

Bandwidth usage doesn't add to the formal proof of work of the main chain, so it is just a deadweight loss, without adding security.

If most of a miner's costs are hashing power, then things are much less likely to end up in the natural monopoly situation (unless hashing ends up with massive economies of scale too).

[Prattler]

I would like to ask devs that before anything is done with the block size limit, the 0.00000001 BTC spam be dealt with.

Bitcoin should be about money and 0.00000001 BTC is not money. A transaction should not be allowed to have an output lower than the minimum fee. Such output is essentially unspendable and is just spam.

Once low output spam is stopped, the block limit will be enough for 1-2 years to come, even with extreme bitcoin adoption. That's enough time to reach the best decision how to continue forward.

[Sukrim]

A transaction should not be allowed to have an output lower than the minimum fee.

There is no such thing as a minimum fee in the protocol, only in the current rules of the most used client. The minimum fee is either 0 or - if you say 0 is "no fee" - 1 Satoshi.

Maybe testnet could be more prominently placed in the client, so people can play around (which is mostly the reason for 1 Satoshi transactions I guess), also with more meaningful amounts.

[jgarzik]

Maybe testnet could be more prominently placed in the client, so people can play around (which is mostly the reason for 1 Satoshi transactions I guess), also with more meaningful amounts.

SatoshiDICE sends 0.00000001 back to you for some losing bets.  Basically, they are using the permanent blockchain as an instant messaging protocol.

[misterbigg]

SatoshiDICE sends 0.00000001 back to you for some losing bets.  Basically, they are using the permanent blockchain as an instant messaging protocol.

I would like to ask devs that before anything is done with the block size limit, the 0.00000001 BTC spam be dealt with.

Why, what's s the big deal? Soon, blocks will always be a megabyte, does it matter what transactions go into the block as long as the fees get paid? The block chain is going to grow at a constant rate with or without SatoshiDice. As far as I'm concerned, SatoshiDice can have their way with the Blockchain as long as there is insufficient transaction volume to fill every block out to one megabyte. And when transaction volume does cross this threshold, SatoshiDice will have to pay market rates for fees just like everyone else.

It's not a problem.

[Prattler]

Why, what's s the big deal? Soon, blocks will always be a megabyte, does it matter what transactions go into the block as long as the fees get paid? The block chain is going to grow at a constant rate with or without SatoshiDice. As far as I'm concerned, SatoshiDice can have their way with the Blockchain as long as there is insufficient transaction volume to fill every block out to one megabyte. And when transaction volume does cross this threshold, SatoshiDice will have to pay market rates for fees just like everyone else.

It's not a problem.

Normal use transactions have inputs and spendable outputs. Once they're spent, they can be completely forgotten (pruned). SatoshiDice is creating massive amounts of unspendable and unprunable transactions. They are not paying enough for the load they're putting on the network.

[misterbigg]

Normal use transactions have inputs and spendable outputs. Once they're spent, they can be completely forgotten (pruned). SatoshiDice is creating massive amounts of unspendable and unprunable transactions. They are not paying enough for the load they're putting on the network.

Now that sounds like a problem. WTF, SatoshiDice?!

I'm confused though, if the outputs of these SatoshiDice transactions are unspendable then why can't they be pruned? Is it because we need to keep them to detect a double spend?

[Sukrim]

Of course they are spendable, but the fees required to do so might be too high in a limited block size scenario.

Also they might be used as fees as far as I understand, but probably again even just including these with the intention to just give them to miners might be more expensive than the space they take up in the chain.

They can't be pruned because they CAN be spent with 0 fees and/or free transactions.

[Prattler]

Now that sounds like a problem. WTF, SatoshiDice?!

I'm confused though, if the outputs of these SatoshiDice transactions are unspendable then why can't they be pruned? Is it because we need to keep them to detect a double spend?

This for example:

http://blockchain.info/tx/ead4232286d7f843c6fd94fa13b12eaee810ca95dc26ffd3deae45a87ffb5d17

The transaction included five 0.00000001 inputs, but that cost the sender 0.0005 in fees (total fee 0.001 with toxic inputs, would have just been 0.0005 without them). There is economic incentive to leave them unspent forever. Make enough of those and you're practically undoing the 0.8 client upgrade back to 0.7 performance.

The toxic outputs can be spent, that's why they can never be discarded.

[justusranvier]

There is economic incentive to leave them unspent forever.

Not forever. Only until the exchange rate is such that they have non-negligible purchasing power.

[markm]

There is economic incentive to leave them unspent forever.

Not forever. Only until the exchange rate is such that they have non-negligible purchasing power.

Yes. So lets work on unlimited exchange rate, raise that high enough and raising other stuff will seem a whole lot less awful to stakeholders.

-MarkM-

[2112]

Not forever. Only until the exchange rate is such that they have non-negligible purchasing power.

Actually Gavin had advocated abandoning wallets swollen with coins that aren't currently economically significant.

By the time the exchange rate rises to the levels you are thinking of all the private keys will be forgotten, lost or abandoned.

The only hope is some sort of "admiralty rules" similar to "flotsam and jetsam" that will grant enterprising miners the salvage rights.

But that would be a hard fork, so...

[justusranvier]

By the time the exchange rate rises to the levels you are thinking of all the private keys will be forgotten, lost or abandoned.

By the time the exchange rate rises to those levels the amount of space those outputs require would be insignificant.

[Mashuri]

Why do you think this proposal wouldn't work to mitigate such an outcome?

I don't even understand that proposal but from the little I do understand, I don't see how it relates to changing the maximum block size. Maybe you could rewrite it in more clear, formal terms?

This is how I currently understand it:

1) Remove the block size limit.
2) Allow clients to set their preferred bandwidth.
3) Let the free market work between these two opposing preferences.  The more miners push the block size beyond the clients' collective capability to download it, the more they run the risk of being orphaned by a smaller block better suited to the current bandwidth.

[2112]

By the time the exchange rate rises to those levels the amount of space those outputs require would be insignificant.

This is a sentence that mathematicians call "indeterminate form of the type zero times infinity". In other words: not a good sign of logical deduction.

[Mashuri]

So it'd be like the search engine circle-jerk back when the most relevevant possible page, in the engine's eyes, was its own output.

So we got what, a big three in each part of the world?

Modula the fact that blocks are not cultural/linguistic the way web pages are, so maybe the big three can be the same big three world-wide, no "you don't even speak our language, you don't understand the nuances of our pages, thus your searches suck" effect helping very-different cultures to prop up a big one (do they even get to have a big three, or are the regions where the big three aren't the biggest only have a big one of their own not their own whole big three?)

Way to not centralise. Are the big number two and big number three still shrinking  the big one or are they becoming more equal?

-MarkM-

I'm not sure what you try to tell me about block size with this...? If that is a (bad) attempt at sarcasm, please keep that out of the debate and post some clear arguments/reasons. As far as I get it, you're saying that there is a threat of centralisation and 3 miners competing in an endgame scenario? Sorry, but it is really not clear to me what point you want to get across.

Unfortunately, this is what I'm mostly coming across.  Unsubstantiated claims and assumptions.