Soft block size limit reached, action required by YOU

[CIYAM]

Well it seems that this thread is starting to contain more heat than light.

[1714821576]

1714821576

[1714821576]

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[drawingthesun]

Well it seems that this thread is starting to contain more heat than light.

[notig]

This is not the solution to this problem.

The *solution* is at this stage very unclear (thus all the threads about this issue).

Understand that if the max. block size were simply abolished then apart from it being a hard-fork (equals Bitcoin turns into BitcoinA, BitcoinB, etc.) the likelihood of people with average hardware (myself included) deciding to keep using the Satoshi client (i.e. full block chain stored on your hardware) will dramatically be reduced (if it were to grow 10x the size in the next few months I would most likely opt out of doing this).

Understand that also most so-called *miners* are actually just *hashers* (they don't *need* the block chain) - so a likely outcome of an unlimited block size would be that mostly only the *pools* would have the entire block chain (everyone else would end up using lightweight clients).

If this occurred then the entire "decentralisation" of Bitcoin would actually be at risk and this is the *real* problem that needs to be worked out (rather than arguing about the legitimacy or otherwise of SD tx's).

how about we define average hardware? Because it seems to me the current limits in place factor in hardware that is ten years out of date. There is such a thing as too decentralized.
The 1 MB limit is severe. If bitcoin is to gain traction it should easily be able to handle 50 million users one day for instance. That's just a fragment of the worlds population.

[CIYAM]

By average hardware I am talking about an average spec. dual-core laptop with around 10 GB of available free disk space.

Since version 0.8.0 the hardware is coping with processing blocks fine (it was freezing the computer all the time with previous versions) and the disk space should last another few years or so (at the current rate).

If the blocks were to double or more in size then I estimate that it could be likely that before the end of the year either I would have to either upgrade my hardware or stop running the current Satoshi client.

BTW - I don't believe the problem is unsolvable and of course I do expect to upgrade my hardware within a few years.

[Jutarul]

how about we define average hardware? Because it seems to me the current limits in place factor in hardware that is ten years out of date. There is such a thing as too decentralized.
The 1 MB limit is severe. If bitcoin is to gain traction it should easily be able to handle 50 million users one day for instance. That's just a fragment of the worlds population.

Bottleneck is not hardware, but bandwidth. Average joe's internet connection has to be able to handle a full node. ( 1Mbit/s w/ 10Mbit/s peak)

[420]

Does Litecoin have the same block size problem?

[CIYAM]

Does Litecoin have the same block size problem?

As it was cloned from Bitcoin one would expect so (as presumably would be the case for all other clone coins).

[Jutarul]

Does Litecoin have the same block size problem?

All cryptocurrencies have the problem, because they all use the same consensus mechanism in essence.

[420]

Does Litecoin have the same block size problem?

All cryptocurrencies have the problem, because they all use the same consensus mechanism in essence.

except different hashing algorithm for Litecoin

[Nagato]

It's not wrong, because it's not the entire solution. I forgot to add that you also determine fees by checking every 2016 blocks what the average fees per block were. Now miners can't manipulate the fee anymore because they don't know who will find the next block, well unless they unanimously decided to insert fees enough to raise the limit, something really hard to achieve since if just one big miner doesn't agree the rest would be paying him to raise the limit.

It can still be gamed upwards. A miner can mine a block with a transaction paying 1000BTC in fees without relaying the txn. If he mines the next block, he pushes up the average, else he doesnt lose anything.

As has been pointed out, there are disadvantages to both extremes.

The primary cost of mining should be hashing power, not bandwidth/storage costs in a datacenter.
In the ideal situation, the gross mining income with an ASIC should not change regardless of whether it is run on a home connection or a datacenter.
Fees are primarily paid for hashing power to secure the network, not for processing/verification, a single low end smartphone could do that. Once you start requiring a Google datacenter to even enter the mining industry due to gigabyte blocks, you have lost control of your currency to a few, but you will have far higher transaction rates and low cost transactions. What is to prevent this large miner from not charging what Visa does? The barrier to entry has become so high that competing would be a very risky proposition.

Don't get me wrong, decentralisation is expensive, very expensive. Bitcoin in its current form vastly more inefficient and expensive than centralised systems like paypal/Visa due to the need for redundancy in storing/processing/verifying.

The question boils down to what level of mining centralisation are we looking for to drive down fees and increase maximum transaction rates.

We need to find a middle ground which supports as many transactions as possible while ensuring that independent hashing(decentralization) remains viable.

[gmaxwell]

It's not wrong, because it's not the entire solution. I forgot to add that you also determine fees by checking every 2016 blocks what the average fees per block were. Now miners can't manipulate the fee anymore because they don't know who will find the next block, well unless they unanimously decided to insert fees enough to raise the limit, something really hard to achieve since if just one big miner doesn't agree the rest would be paying him to raise the limit.

Is this software design by debate?  Am I the design oracle which will only tell you when a design is no good, so you search for the solution by suggesting all the things which are not the solution?

Think a little harder on this. This fails because its costless and obviously in all miners interest to mine fake fees. Fees are paid to this block, not the next block, miners would pay fees to themselves and skew up the average. Your revised proposal is isomorphic to straight up having miners vote on it, which fails for all the previously discussed reasons.

I don't like this idea because I don't think enough fees would be collected to provide for adequate security. What if hashpower becomes so easy to increase that the relationship you set as a rule for block size limit being raised doesn't even beging to cover anything?

I don't like it much either, but not for those reasons... What was suggested there is proportional and limits the increase to be strictly less. Breakthroughs in the energy efficiency of POW will also result in increases in efficiency of verification (except perhaps POW ease due to a huge SHA256 break, but in that case we must hardfork to remove SHA256 from the merkle root).

I said it's retarded to suggest it in Mikes scenario when there is no(or close to no) income. There are better ways to heat than to run a miner on a loss.

Okay, I missed that condition.

[420]

It's not wrong, because it's not the entire solution. I forgot to add that you also determine fees by checking every 2016 blocks what the average fees per block were. Now miners can't manipulate the fee anymore because they don't know who will find the next block, well unless they unanimously decided to insert fees enough to raise the limit, something really hard to achieve since if just one big miner doesn't agree the rest would be paying him to raise the limit.

It can still be gamed upwards. A miner can mine a block with a transaction paying 1000BTC in fees without relaying the txn. If he mines the next block, he pushes up the average, else he doesnt lose anything.

As has been pointed out, there are disadvantages to both extremes.

The primary cost of mining should be hashing power, not bandwidth/storage costs in a datacenter.
In the ideal situation, the gross mining income with an ASIC should not change regardless of whether it is run on a home connection or a datacenter.
Fees are primarily paid for hashing power to secure the network, not for processing/verification, a single low end smartphone could do that. Once you start requiring a Google datacenter to even enter the mining industry due to gigabyte blocks, you have lost control of your currency to a few, but you will have far higher transaction rates and low cost transactions. What is to prevent this large miner from not charging what Visa does? The barrier to entry has become so high that competing would be a very risky proposition.

Don't get me wrong, decentralisation is expensive, very expensive. Bitcoin in its current form vastly more inefficient and expensive than centralised systems like paypal/Visa due to the need for redundancy in storing/processing/verifying.

The question boils down to what level of mining centralisation are we looking for to drive down fees and increase maximum transaction rates.

We need to find a middle ground which supports as many transactions as possible while ensuring that independent hashing(decentralization) remains viable.

uh how is it more expensive................are you saying because the pool controls little miners?

a $600 ASIC is about the same cost as 3x regular GPU's previously bought for mining

[johnyj]

BTC Guild started setting up a new server this morning running modified block rules.  Currently trying out a 500,000 byte maxblocksize.  The problem is with larger blocks, you increase the chance of orphans since it will take at least twice as long to propagate, if not more.  I've modified the fee settings to prefer fee based transactions when increasing the block size past 50 KB, so hopefully the increase in fees per block offset the orphan rate increase.

The old settings were default, with the 250,000 byte limit, 27k for high-priority (regardless of fee).  The new settings we're trying (subject to change, and not on all servers yet) is 500kB block max size, no reserved space for no-fee transactions with high priority, and a minimum size set to 50 kB to grab high priority/no-fee transactions if there aren't that many unconfirmed paid transactions.

I do not really understand why did you change the soft limit on max blocksize? The purpose of this limit is to simulate what will happen when a hard limit is hit, do you already forced to lift the soft limit due to some severe problem?

[johnyj]

By default Bitcoin will not created blocks larger than 250kb even though it could do so without a hard fork. We have now reached this limit. Transactions are stacking up in the memory pool and not getting cleared fast enough.

What this means is, you need to take a decision and do one of these things:

• Start your node with the -blockmaxsize flag set to something higher than 250kb, for example -blockmaxsize=1023000. This will mean you create larger blocks that confirm more transactions. You can also adjust the size of the area in your blocks that is reserved for free transactions with the -blockprioritysize flag.
• Change your nodes code to de-prioritize or ignore transactions you don't care about, for example, Luke-Jr excludes SatoshiDice transactions which makes way for other users.
• Do nothing.

If everyone does nothing, then people will start having to attach higher and higher fees to get into blocks until Bitcoin fees end up being uncompetitive with competing services like PayPal.

If you mine on a pool, ask your pool operator what their policy will be on this, and if you don't like it, switch to a different pool.

I suggest that all the pools and miners take this chance and DO NOTHING, and we will see if bitcoin really end up being driven out by PayPal 

I think they are totally two different network and surve different purpose. I use paypal mainly because I want to spend inflative fiat money as quick as possible, and it can guarantee a charge back and give me invoice. But bitcoin just can't do that no matter how low the fee is. Bitcoin protect merchant but not consumer, so it will not be used by mass scale of consumers, maybe mostly gamblers 

[Nagato]

It's not wrong, because it's not the entire solution. I forgot to add that you also determine fees by checking every 2016 blocks what the average fees per block were. Now miners can't manipulate the fee anymore because they don't know who will find the next block, well unless they unanimously decided to insert fees enough to raise the limit, something really hard to achieve since if just one big miner doesn't agree the rest would be paying him to raise the limit.

It can still be gamed upwards. A miner can mine a block with a transaction paying 1000BTC in fees without relaying the txn. If he mines the next block, he pushes up the average, else he doesnt lose anything.

As has been pointed out, there are disadvantages to both extremes.

The primary cost of mining should be hashing power, not bandwidth/storage costs in a datacenter.
In the ideal situation, the gross mining income with an ASIC should not change regardless of whether it is run on a home connection or a datacenter.
Fees are primarily paid for hashing power to secure the network, not for processing/verification, a single low end smartphone could do that. Once you start requiring a Google datacenter to even enter the mining industry due to gigabyte blocks, you have lost control of your currency to a few, but you will have far higher transaction rates and low cost transactions. What is to prevent this large miner from not charging what Visa does? The barrier to entry has become so high that competing would be a very risky proposition.

Don't get me wrong, decentralisation is expensive, very expensive. Bitcoin in its current form vastly more inefficient and expensive than centralised systems like paypal/Visa due to the need for redundancy in storing/processing/verifying.

The question boils down to what level of mining centralisation are we looking for to drive down fees and increase maximum transaction rates.

We need to find a middle ground which supports as many transactions as possible while ensuring that independent hashing(decentralization) remains viable.

uh how is it more expensive................are you saying because the pool controls little miners?

a $600 ASIC is about the same cost as 3x regular GPU's previously bought for mining

I assume you mean how Bitcoin is more expensive.

You have to understand that any full node, could be your home PC, can alone process/mine/verify all bitcoin traffic today singlehandedly. It does not matter if every other miner out there disappeared, the bitcoin network will still function as smoothly as it did.

Every other Full node, be it a miner or full client, is redundant and incurs a cost to the economy in hardware/bandwidth costs. If there are 100k people running full nodes, the cost of the Bitcoin network is ~100k times more expensive than Paypal/Visa(Just goes to show how much money they actually make without competition). What these redundant nodes provide is dencentralisation and in the case of miners, hashing power to secure the network.

[hazek]

It's not wrong, because it's not the entire solution. I forgot to add that you also determine fees by checking every 2016 blocks what the average fees per block were. Now miners can't manipulate the fee anymore because they don't know who will find the next block, well unless they unanimously decided to insert fees enough to raise the limit, something really hard to achieve since if just one big miner doesn't agree the rest would be paying him to raise the limit.

Is this software design by debate?  Am I the design oracle which will only tell you when a design is no good, so you search for the solution by suggesting all the things which are not the solution?

Think a little harder on this. This fails because its costless and obviously in all miners interest to mine fake fees. Fees are paid to this block, not the next block, miners would pay fees to themselves and skew up the average. Your revised proposal is isomorphic to straight up having miners vote on it, which fails for all the previously discussed reasons.

Yeah.. nvm me, a non dev noob.  I thought about it a bit more after I went to bed last night and it occurred to me what you're saying I just wasn't sure if a miner can add a tx with some outrages fee that he doesn't need to broadcast while "looking" for a block. If he doesn't 1 miner alone could skew the average above that limit.


Well good luck to Bitcoin and all of us because I now really think we're going to need it if we are to find a solution that will scale and will provide the right incentives.

[TheButterZone]

tl&tc;cu
So is this the beginning of the end of Bitcoin, or can the blockchain abuse+bloat be fixed without 1) locking all devs and miners in a room and saying "fix this if you want to get out" or 2) further kissing the jackboots of tyranny and requesting they shut down SD & copycats in exchange for brutal taxation?

Can even Satoshi himself fix this?

[Jutarul]

tl&tc;cu
So is this the beginning of the end of Bitcoin, or can the blockchain abuse+bloat be fixed without 1) locking all devs and miners in a room and saying "fix this if you want to get out" or 2) further kissing the jackboots of tyranny and requesting they shut down SD & copycats in exchange for brutal taxation?

Can even Satoshi himself fix this?

no worries. transaction fee requirements will restore the equilibrium. The only thing which may get slowed down is the adoption rate, because suddenly bitcoin transactions cost real money.

[TheButterZone]

tl&tc;cu
So is this the beginning of the end of Bitcoin, or can the blockchain abuse+bloat be fixed without 1) locking all devs and miners in a room and saying "fix this if you want to get out" or 2) further kissing the jackboots of tyranny and requesting they shut down SD & copycats in exchange for brutal taxation?

Can even Satoshi himself fix this?

no worries. transaction fee requirements will restore the equilibrium. The only thing which may get slowed down is the adoption rate, because suddenly bitcoin transactions cost real money.

"Nearly free" is far better than a vague "cheaper than credit cards" (real money). The TX fee requirements need to be kept to "nearly free", otherwise the status quo of shitty global finance is here to stay and Bitcoin might as well be resigned to the kid's lemonade stand next to a Jamba Juice, forever.

[Nagato]

Id just like to add on that given today's network speeds, a 10MB block size(eqv to Paypal txn rates) is doable and would still maintain relatively high levels of mining decentralization(miners would require something like a 30Mbps u/d connection to keep average download/upload times to 1% of mining time). It would drive many small miners out, possibly shrinking p2ppool, migration of most miners to pools which have a node in a datacenter. But it wont be to the point that you would need a large corporation or VC funding to run a mining node. Anyone paying a few hundred dollars/month could host a mining node in a datacenter or subscribe to a faster internet connection.

But i don't think that we will need anywhere near that size for many many years to come. The reason is that i simply do not see blockchain txns being viable as a POS solution. For physical stores, im not going to buy a laptop and wait around 30mins for 3 confirmations before the store owner is sure that im not double spending. Even for low cost items, cash is just better suited than a blockchain txn(waiting ~10mins to confirm so i can purchase a drink). Note i said blockchain txn, off blockchain methods like a pre-paid bitcoin card/service or physical bitcoin coins/notes are instant and cheaper.

As for online transactions, Paypal/Visa/Mastercard are not collapsing overnight. It is very likely that they will reduce fees/cut costs once Bitcoin starts to take their market share. And they can theoretically always be cheaper than Bitcoin due to a more efficient centralized system. If Bitcoin provides competition and forces them to become competitive, it is a victory for everyone. Even if fiat collapses, with Bitcoin being an open system, there is no limit to the number of payment processors that can spring up and provide instant off-chain txns for small amounts. This is not the case with the fiat world, even Google/Paypal have to rely on the Visa/Mastercard to process fiat txns allowing the 2 to have huge margins for negligible cost.