Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

[BitUsher]

i remember paying the 5cent fee fully knowing i could do it with no fee at all. all this proves is we dont need block to be totally full to get poeple to pay fees.

The reason why we spent 5-13 pennies before v0.8.2 is precisely because not paying the fee than meant a delay because not all mining pools included free tx's.

The real solution is to use a payment channel like the LN which can insure us low fees of 1-5 pennies, immediate and secure confirmations, even with spam attacks.

[adamstgBit]

the thing is high fees hurting bitcoin IMAGE.
thats the biggest down side

as an investor i find this blocksize debate unacceptable when the cure is so simple.

your busy bitching about stupid technicalities while bitcoins image is getting smashed.

why are poeple buying ETH, is it because Bitcoin is BROKEN??? no but it sure as hell FEELS like it.

[JayJuanGee]

...
In spite of this supposed block size limit crisis that has been shouted about for more than a year .....there is no real evidence of a crisis....

I'm pretty sure that counts as a contradiction in terms.

The fact that there are such opposing views is itself a failure by the lead devs to maintain consensus.

There's no contradiction there.... we gotta bunch of loud mouths, and that's about it.  self-created crisis of loud mouths being loud on purpose and attempting to create a crisis where no crisis really exists.

Despite loud mouth misrepresentative descriptions of core devs as some kind of management team, core devs do not have any responsibility to create some kind of impression of smoothness within the bitcoin ecosystem or to respond to a bunch of nonsensical loudmouths.  They are mostly carrying out the status quo, and no one person or group of people speak for core devs, except some are more influential than others (as we have seen that some core devs carry more responsibilities than others development, coding or mining)

The classic/xt etc loud mouths are creating a self-fulfilling prophesies, which seems to kind of go with the territory of peer to peer systems in which some people would prefer a manager or a controlling entity, when non exists in this bitcoin peer to peer system. 

Therefore consensus within this bitcoin space is achieved by maintaining the status quo until there is some overwhelming  and non-disputed demonstration that an actual change is needed.. and apparently at this point in time (regarding the blocksize limit increase question) there is no overwhelming demonstration that an actual change is needed (except to the extent to which seg wit has been agreed to as an up and coming change that is being actively worked on).

[billyjoeallen]

The simple fact is that it's easier to disrupt a network that is already running close to capacity than one that has more excess capacity. That should be intuitively obvious to anyone without a mental handicap.

LOL well put.
I'm going to keep that one in my back pocket.

He forgot the bloat part which is achieved with less cost when the network has ample capacity.

If normal use, is, say, 500-700kb and the rest is spam that goes in for cheap, then instead of a spammer filling 300-500kb of spam for free/near free, he gets to increase that to 1300-1500, which is 3-4x.

I did not forget the bloat cost. I addressed that.  Hard drive space is so cheap and getting cheaper that any damage caused by bloat will cost the attacker more than the network.  It currently costs ~ $5,000 in fees to bloat the blockchain by 1 GB.  Harddrive space is about 30 cents a GB (and getting cheaper), so with 10,000 nodes, it costs $3,000.  It costs 5 grand to cause less than 3 grand worth of damage. This may not be satisfactory to some, but it makes this kind of attack a much smaller worry than other problems that we need to be dealing with.

The bloat cost creates

1) storage costs
2) bandwidth costs (as this 1gb or 10gb or 100gb must be downloaded and served over and over in the network - for decades)
3) processing costs / power costs (for decades)
4) I/O slowdowns (if the blockchain can't fit in anymore in an affordable SSD you'll have to rely on a mechanical disk which is slow)
5) centralization cost as nodes have to drop out, increasing costs to the fewer nodes that remain. It's a vicious cycle where the less you have, the more the costs, plus you now become an easier target for DDOSing (more costs)

As for the problems that we may need to worry, these are what exactly? That txs without a few cents in fees won't go in in the next block? That's all there is to it.

Bandwidth is a one time cost per node. Once you have downloaded the blockchain, you only need to add to it, not download it again for each new block.  My ISP charges me a flat fee, but if you amortized it, it would be something like $0.05 for a 1 GB download at the most.  Multiply that by 10K nodes and you still have a cost to the network of <$500.  These are conservative numbers. We really only have about what, 8K nodes?

Trivial cost increases do not cause nodes to drop out. What causes that is a subjective value to the node operator that the cost exceeds the perceived benefit.  Bloat costs only come into play at the margins and are dwarfed by more relevant factors, such as using a node as a voting mechanism, securing transactions as part of a business, independent transaction verification, etc.   

We do not have the luxury of endlessly fretting over every perceived threat. There are too many. Node centralization is a real concern, but we have to prioritize. Many feel that code ossification and development centralization is a much greater threat considering increased altcoin competition.  What is Core doing to address the mining concentration problem? Anything? if so, I am not aware of it. They are still working on transaction maleablity, for Christ's sake, a problem that should have been fixed years ago.

Network congestion is a bigger problem than node centralization for the same reason that traffic jams are a bigger problem than potentially corrupt highway police.  A single traffic jam causes thousands of man-hours in lost productivity while a crooked traffic cop could cause dozens or maybe hundreds in the same amount of time.  People often intentionally drive through known speed traps to route around traffic gridlock. When faced with a choice of several suboptimal choices for getting from point A to Point B, people rationally choose the path of least resistance.

[ChartBuddy]

Coin



Explanation

[JayJuanGee]

The simple fact is that it's easier to disrupt a network that is already running close to capacity than one that has more excess capacity. That should be intuitively obvious to anyone without a mental handicap.

LOL well put.
I'm going to keep that one in my back pocket.

He forgot the bloat part which is achieved with less cost when the network has ample capacity.

If normal use, is, say, 500-700kb and the rest is spam that goes in for cheap, then instead of a spammer filling 300-500kb of spam for free/near free, he gets to increase that to 1300-1500, which is 3-4x.

i need ammo FOR block size increase not against it...

but you gotta admit that AlexGr just provided very good evidence why we shouldn't just rush into some kind of a blind blocksize limit increase when such blocksize limit increase does not seem to be at all necessary (except to shut up a bunch of loud ass "sky is falling" whiners).  

In spite of this supposed block size limit crisis that has been shouted about for more than a year (and more vocal in the past 6 months and even more vocal in the past couple of months - repeated shouts), there is no real evidence of a crisis and bitcoin has been doing pretty well in staving off a lot of nonsense spamming and still processing valuable transactions in a timely manner for low to no fees.

look months ago it was " look i made a free TX and it eventually got through "
then it was " I paid just this tiny tiny fee and it eventually got through "
today its " i paid only 1 cent worth of bitcoin and it eventually got through "
tomorrow it will be " i paid only 4 cents worth of bitcoin and it eventually got through "

they will keep saying "there's no problem here" even with a 25cent fee.

I don't know Adam.  You seem to be extrapolating too much.  We gotta see how these fee matters play out. 


Both you and I already tested the matter a week or so ago, and we saw that transactions were going through pretty quickly whether there was a fee or not, even when the block fullness was running around 85%. 

It seems pretty likely that fees are going to have to go up somewhat, but really are we expecting $.25 fees any time soon or any time for $1 transactions as compared with $10k transactions?  Maybe it would be acceptable to pay $.25 for a $10k transaction, especially if we want to prioritize that amount of a transaction.... but we already know that at this time and in the foreseeable future, we could still send that $10k transaction for free, so long as we are o.k. waiting a few days (which is still fucking way better than any banking system that you can think of.. in which there are way more strings and way more control over who's sending, who's receiving and what is the purpose of the transaction.. blah blah blah.. and are you already our customer.. blah blah blah).

[BitUsher]

the thing is high fee hurt bitcoin IMAGE.
thats the biggest down side

as an investor i find this blocksize debate unacceptable when the cure is so simple.

Agreed that high fees hurt bitcoins image, but you have to keep in mind there are many people attracted to bitcoin for other reasons. Node and mining centralization hurts bitcoins image even more and the LN is intended to reverse that node centralization trend and including another real problem like the insecurity of 0 conf payments which can hurt bitcoins image far more than paying a couple pennies more per tx... the sad reality is that 0 conf payments have never been secure and will never be secure. What core devs fear more isn't the problems with raising the blocksize to 2MB in itself but the precedence it sets that we can continue to kick that can and put of development on real solutions that solve multiple problems in bitcoin. This is why the 2MB HF is pushed out till next year to make sure that we can deploy the LN and other payment channels which should have been used from years ago.

It is embarrassing that payment processors aren't pushing payment channels more when it will cut down on their fraud. At least bitpay has worked a bit on impulse with Garzik when he worked there and Stephen Pair now acknowledges Core's and others concerns -
https://medium.com/@spair/what-i-learned-at-the-satoshi-roundtable-7f6ff19ac6c3#.i10adcvqa

But Brian still is hopelessly confused.

[Adrian-x]

The bloat cost creates

1) storage costs
2) bandwidth costs (as this 1gb or 10gb or 100gb must be downloaded and served over and over in the network - for decades)
3) processing costs / power costs (for decades)
4) I/O slowdowns (if the blockchain can't fit anymore in an affordable SSD you'll have to rely on a mechanical disk which is slow)
5) centralization cost as nodes have to drop out, increasing costs to the fewer nodes that remain. It's a vicious cycle where the less you have, the more the costs, plus you now become an easier target for DDOSing (more costs)

As for the problems that we may need to worry, these are what exactly? That txs without a few cents in fees won't go in in the next block? That's all there is to it.

1) storage costs are insignificant. ($300 = 6TB)

2) a legitimate constraint. (I say the market should find a balance.) FYI SegWit increases network tragic for less transactions it has positive effect of reducing the insignificant storage cost at the expense of using more of the valuable bandwidth cost.  

3) the processing cost is not a energy cost but a lost opportunity cost, time is money. (SegWit here increases this too)

4) this is such a far off concern it's not worth contemplating, already future storage technologies are coming on line daily and will be commercially available well before we expect the blockchan to hit 1TB.

5) such nonsense, nodes don't drop out because of the cost of storing the blockchanin or the cost of an internet connection, making it cheeper is not going to increase the demand to run a node. The demand to run a node is a result of wanting or needing to use and interact with the blockchain directly, running a node gives you security that your version of events is consistent with the economic world in which you interact, nodes will increase as a function of market capitalization and wealth distribution.  

Thinking the scaling issues are about transaction fees of a few cents is asinine, it's about letting bitcoin grow organically. We are all paying $5-10.00 in subsidized transaction fees anyway, we need allow economies of scale to grow to replace those subsidies.

limiting block size to what we have today with no increase in total market cap = fees/tx will need to gravitate to the $5-10 per transaction to keep the security we have today.
 

[JayJuanGee]

O.k... take for example, when a few months ago, he said that Coinbase was going to support Classic XT etc...

FTFU - Coinbase said they were going to test XT...

Ok. thanks.. I was kind of shooting off the cuff.. by memory... but what you say sounds exactly correct... and much more accurate than what I said.. but my point, in part, was that Armstrong has been increasing and increasing and increasing his involvement in the debate, rather than merely making statements regarding what his company was going to do.. he is currently seeming to be involved in an ongoing battle of persuasion to convince a lot others what they should do, too... which for me is beginning to come off as a bit much and causing me desires to remove some of my dinero from their system.

[adamstgBit]

should we wait for segwit + LN  + other improvement to scale bitcoin? SURE in a perfect world that would be gr8. but blocks are full NOW, and everyone going apeshit about it.

shareholders are getting fucked-up by Core's o'mighty principals and we all know it.

as selfish as it is, my networth has and continues to suffer gr8ly over all this BS, and i'm sick of it...

[AlexGR]

Right now, we cannot have blocksizes that can do VISA-level txs

This is said a lot, but it's actually not a problem that bitcoin has, it's a problem we all want to have and no one has a viable plan as to how to make that problem a reality - despite that disconnect we all conceive that it's remotely possible.

It can be made a reality pretty easily if we co-locate the miners and nodes into a single data center - or a few data centers well interconnected with big fat lines, in a way that even 1gb blocks at 3000tx/sec would not be an issue. But then you don't really have a peer to peer bitcoin. You have a (centralized) client/server one with plenty of attack vectors, including physical raids.

The problem bitcoin has is the block size is temporarily limited by the consensus system that's meant to prevent double spending, when in fact block size should be constrained by available technology. The Limit is temporary as Bitcoin wasn't initially conserved with the limit, and when it was added it was proposed that the limit would be increased at a point in time, first projected to be around March 2011.  

Actually satoshi said we can raise it when we are closer to needing it. That was just an example.

Bitcoin may not have a scalability problem at all. The scalability issue is based on a linear projection and a prediction that if we got VISA-level txs today we'd have a problem.

With everyday technology, current software and p2p topology of nodes all over the world, it has a scalability issue, yes.

If you centralize it, it stops having the problem. If you wait for technology to evolve, so that it can also allow bitcoin to work in a decentralized way, you can get a scalable AND decentralized bitcoin.

[BitUsher]

1) storage costs are insignificant. ($300 = 6TB)

2) a legitimate constraint. (I say the market should find a balance.) FYI SegWit increases network tragic for less transactions it has positive effect of reducing the insignificant storage cost at the expense of using more of the valuable bandwidth cost.  

3) the processing cost is not a energy cost but a lost opportunity cost, time is money. (SegWit here increases this too)
 

Are you pricing things in VPN hosting rental numbers , because many cannot and will not be able to run nodes from their home because of bandwidth limits and softcaps. The ISP's have oversold their bandwidth and with everyone torrenting and streaming HD the demand for bandwidth is higher than the supply.

Thinking the scaling issues are about transaction fees of a few cents is asinine, it's about letting bitcoin grow organically. We are all paying $5-10.00 in subsidized transaction fees anyway, we need allow economies of scale to grow to replace those subsidies.

limiting block size to what we have today with no increase in total market cap = fees/tx will need to gravitate to the $5-10 per transaction to keep the security we have today.
 

Yes, I agree that we need 5-10 USD of security per tx if not higher. Do you agree that the only way to scale is by having the mainchain be a settlement network? Have you done the math on 128MB blocks + thin/weak blocks vs 8MB blocks + LN + thin/weak blocks?

There really isn't a comparison between the two. One can scale and the other one lacks throughput and is centralized.

[AlexGR]

the thing is high fees hurting bitcoin IMAGE.
thats the biggest down side

There are no high fees in bitcoin.

[adamstgBit]

the thing is high fees hurting bitcoin IMAGE.
thats the biggest down side

There are no high fees in bitcoin.

fine then,

 the endless debate with 0 progress for years is hurting bitcoin image

better?

the simple fact that the video "what is bitcoin" where it says "no fee", which now needs to be changed to "only ~5cent fees"
is a huge setback.

[JayJuanGee]

you pretty much prove my points with your nonsensical continued attempts at ad hominem and your not even attempting to engage with respects to substance.

Just because you fail to grasp the nuanced complexity of the claim you seem to be attempting to attempt to attribute to me, a claim that I am neither attempting to make, nor have attempted to make in the past (or am in the process of currently making), don't mean my unclaimed claim ain't chock full of sense. Oodles of sense.

And if I hear ad hominem from you one more time, homie, I'll be forced to go ad baculum on your ass

You are making a point to attempt to distract and to make fun of others.  What kind of other substance is there within your stupid-ass post?  Seemingly, none, and such assessment is not my lacking in reading and/or comprehension skills as you would like to suggest..

Even though I invited you to attempt to engage in substance, you are not even trying. For example, you probably won't even answer any question regarding whether you own any bitcoin? or what kind of involvement in bitcoin you have because your apparent purpose is to provide garbage an non-sensical posts in an attempt to distract from our lovely (mostly intended to be wall observer speculation) thread, even though in recent months this thread seems to have denigrated into a largely block size debate thread... yet hopefully at some point soon we will get past such dumb topic (when prices move into the $500s and the likely soon thereafter $600s)

[BitUsher]

should we wait for segwit + LN  + other improvement to scale bitcoin? SURE in a perfect world that would be gr8. but blocks are full NOW, and everyone going apeshit about it.

shareholders are getting fucked-up by Core's o'mighty principals and we all know it.

as selfish as it is, my networth has and continues to suffer gr8ly over all this BS, and i'm sick of it...

Blocks were full for 3 days and the only thing that happened is fees went for 3 pennies to 7 -10 pennies... during an attack..
It appears that the attack may have restarted after a couple days rest.
 
Are you suggesting you care more about short term profit rather than longterm health?

[ahpku]

...
Yes, I agree that we need 5-10 USD of security per tx if not higher. ...

"I understood at last the look in his eyes. He was insane."--Brainyquotes.com

>during an attack
Which cost less than what an average suburban bank branch spends on lollipops for the kiddies.
Such Antifragile!

[adamstgBit]

should we wait for segwit + LN  + other improvement to scale bitcoin? SURE in a perfect world that would be gr8. but blocks are full NOW, and everyone going apeshit about it.

shareholders are getting fucked-up by Core's o'mighty principals and we all know it.

as selfish as it is, my networth has and continues to suffer gr8ly over all this BS, and i'm sick of it...

Blocks were full for 3 days and the only thing that happened is fees went for 3 pennies to 7 -10 pennies... during an attack..
It appears that the attack may have restarted after a couple days rest.
 
Are you suggesting you care more about short term profit rather than longterm health?

your overstating the effect of a "bandaid solution" of raising the block limit sooner rather then later.


or do you blieve 1MB FOREVER =  longterm health??

[coins101]

...I don't agree on your timeline......

Here are a few reasons why you should:

> I can walk up to kiosk and wave my credit card or bank card and pay for anything under $30 in less than 3 seconds.

> I've got several credit cards and I haven't paid a penny for them or to use them for years.  But I still get all sorts of payment protection insurance and free replacement cards whenever I want.

> My cards are linked to my bank account. As long as I get paid, I don't have to do any extra work to use my cards that give me quick and easy access to as many cups of coffee as my brain can handle before getting completely wired.

If I use Bitcoin to pay for $3 of coffee and cake, first I need to do some extra work; then I incur exchange fees; and then I have to pre-pay for the LN; before I get charged a fee for a transaction I can get for free, with less cost and for less effort.

[adamstgBit]

FACT blocksize will increase
FACT core plans to do it
FACT the network could benefit from this increase today
FACT we are waiting a full year before we do it, because we have some unproven code that could MAY increase "effective blocksize" by 1.75x if Core can figure out why it's forking the crap out of the testnet.

FACT run to eth for short trem profits