BTC.value = if(you_can_get_blocksize_together = 10K, dead);

[AngryDwarf]

So bitcoin limiting itself is just slow suicide as competitor systems are improving.

Right, and none of those financial companies would dream of jeopardising their very valuable trading systems by pushing the network resources used right up to the limit, they would employ a provable margin of safety, and find a better way to improve their transaction rate. This is not difficult to understand

When the system nears max capacity traders find there positions (balance) are unreliably backlogged and they can no longer make fully informed decisions. You argue with the technology manager that near system capacity usage is actually a bottleneck, and a hardware upgrade is required. The trading manager is so frustrated that he is willing to sign off the budget for the new hardware. On the new hardware the system keeps up, and actually uses less processing power than before, and is far more responsive (less latency). The traders then thank the employee who argued with the stubborn technology manager.

Real world example, BTW.

In bitcoins case, emergent consensus could be used to restrict capacity to technological capacity:

https://bitcointalk.org/index.php?topic=1828428.msg18204464#msg18204464

[1715094770]

1715094770

[Carlton Banks]

But your example is not analogous to a peer-2-peer system, so it's not meaningful. You may as well be one of these people that say "why can't the miners mine BTC faster to solve this"

[dinofelis]

32 MB per 10 minutes needs a link of 56 KB/s.  Most people torrent faster when downloading movies.

There are probably more people with 56 Kk/s connections than any other speed (and less, even more people have access to only 28 kB/s)

Your idea is to force people with 56 kB/s to use their ENTIRE INTERNET BANDWIDTH to download 32 MB blocks? Which get solved ON AVERAGE every 10 minutes, and in reality can (and often do) occur 2-3 seconds apart because of the variance around that average? 28 kBs be damned. Great plan

Those people are totally unimportant: they will not weight in on the market price of bitcoin (their market share is way too small, their financial capacity is way to small).  As such, they are not a source of profit for the miners.  Their transactions are not profitable, small fish.

A PoW system is optimising itself to extract a maximum of value out of its users.  In the first phase, that's by block reward, in the second phase, that is by fees.  These coin incomes have to be sold at market price. 

So a PoW system will optimise the expenditure of (block reward + fees) x market price, to produce the largest amount of PoW possible, the product sold to the users.  This system is sensitive to market price, and hence market makers on one hand (big fish) and the fee incentive (fee market) on the other.

Increasing the block size, and releasing pressure on the fee market, to gain some transactions from small fish that cannot afford more than a 56Kb line, is ridiculous: the relief on the fee market to get these guys in would plummet the fee income much more, than that these players are capable of pumping up the market price.

If anything, I expect soft forks to REDUCE the block size in the long run.  When bitcoin is a reserve currency, and a coin is over $100 000,- it would be tempting to increase the fees by lowering the room on the block chain, and have all these big investors fight for the small transaction room.

But what counters this, is that "room on the block" will probably be bulk-sold contractually (human contractually) between mining pools and big users (exchanges, on line casinos, and all those other players needing a non-regulated reserve currency for their unregulated financial affairs).  So limiting the stuff you can sell expensively would be good for the miners, but they will not respect it amongst themselves. 

[Carlton Banks]

If those people (i.e. people with 1Mb/s internet) are totally unimportant, why did they form the central component of your previous argument

[AicecreaME]

3 things


1. What business accepts these alts? It rhymes with "shogun"

2. Why not? Is it becasue of Bitcoin's coveted MASSIVE AMOUNT OF CUMULATIVE HASHES PROTECTING EVERYONE'S BTC? It is, isn't it?

3. Altcoin exchange rate or market caps means nothing. Fiat money is free to those with the printing press or access to the right kind of credit.

I accept your points, but they are orthogonal to my main contention, which is the implication the Dev/Miner consensus look to have ground to a standstill with vastly deleterious effects

If they can not even get through a larger blocksize even as a stop gap of say 8mb or something, in the face of huge user demand, which btc community always sought, what does this mean for any meaningful dev on anything else.

What good are hash protected coins if they become unable to be moved?

Your so right we do have massive btc adoption, but now cannot cheaply spend our coins....!

Bitcoin could move even though in the high transaction fee or low transaction fee, the only thing is, we don't want to pay for this transaction fees price, why? because if we are not earning enough bitcoins, and we do have to pay this high transaction price every transaction, then it is really a problem to us, but if we are going to think of it, this problem is so little and can be solve by changing our ways on earning bitcoin, so this transaction fee that most of us are complaining about won't be a problem anymore.

And it is not that bitcoin couldn't move because of this delay transactions, it's just every transaction take time since the blocksize have already reach its limit and can't process transaction that fast like before because of the bitcoins transaction count is more than the bitcoins population count.

So, if we really want to have faster transactions, then we have to pay higher fees, and if we are only willing to pay low transaction fees, then we have no right to complain if we are going to wait till our transactions to be confirmed.

[dinofelis]

If those people (i.e. people with 1Mb/s internet) are totally unimportant, why did they form the central component of your previous argument

There are different statements, and arguments for these statements, which are mixed here.

The first statement is:
"The claim that, for a crypto currency based upon PoW leads to centralisation, is bogus".  

The example crypto currency can be a HYPOTHETICAL bitcoin with 32 MB blocks, or any other crypto currency with free block size.  This is where I argued that:
1) as long as the miners agree and make only one block chain, nodes can only copy that block chain, there ain't any other around.  So whether there are LOTS of proxy servers (nodes), or just a few, doesn't matter, what matters is the miners that make that chain.  Users only need to access A node with their wallets, and *if they really want to, for themselves, can download the entire block chain to verify*.
2) even 32 MB blocks every 10 minutes doesn't require extra ordinary computing and network equipment as of today.

Mind you that we are not talking about the real bitcoin of today, but about a hypothetical bitcoin, or another crypto, with blocks that can be 32 MB.

The second statement is:
"Given that the actual bitcoin protocol is blocks of 1MB, and that the only agents capable of modifying this, are miners (they make the blocs !), in order for this potentially to happen, there has to be a huge consensus between miners to do so, and to do so with the same protocol change ; this won't happen, because there is NO incentive AT ALL for ANY MINER to go to bigger blocs and release pressure on the fee market".

Here, my argument is that small fish don't matter, because increasing bloc size to allow smaller fish to transact some bitcoin, doesn't increase miner revenue, on the contrary.  This means that miners have no incentive, not only to get these fish to bitcoin and transact and they CERTAINLY have no incentive to try to make them do so with a 2nd tier network because these poor suckers can't even download a bloc chain.

In other words, the original lowering of the bloc size from 32 MB to 1 MB, to "allow poor suckers to use bitcoin over their 56kb lines" is totally BS.  But now that that 1 MB limit is part of the protocol, the only people that could, eventually, decide to lift it, the miners, have absolutely no reason to remove that bonus for them, not with bigger blocs, and not with a second tier network.  

Miners don't need small fish adoption.  They want big whale usage of bitcoin, with few transactions of large amounts, and the current protocol is perfect for that.  It didn't need to be so, but by error or by intend, it has been designed that way, and they would be crazy to remove this.

[Xester]

OK btc world, I am of the view that if the BTC community cannot get the blocksize issue sorted out now, and some sort of optional instant send side chain, the demand for the features are great enough that some alt will replace BTC, sooner than later. Not just for the blocksize issue, but for the implication of the state of dev in BTC.

Certain alts of recent should be a serious wake up call. They have proven the market is prepared to discount the faults instamines, some centralization whatever.

The market demand for instant send, open policy dev discussion and the ability to implement change is to high.

People are tired of the fight, and want solutions now, this is exacerbated by the fact they can see the solutions ready.
The BTC network is being driven to a halt for normal users as it becomes expensive to send BTC with current blocksize.

It is interesting to see the 1st to market advantage of BTC being thrown away, particularly as BTC now what it craved for so long, real world adoption and usage, unlike most other coins, and what is being done with it?

Fees have gone through the roof due to a stupid fight between a few people than no one cares about. Get a 8mb blocksize already or whatever if you want to live.

At the inflection point of BTC success, the dev model has failed to reach consensus. This may be one of the importnat boundary conditions of sucess::how a coin is sets up and dev/miners dynamic.

It seems the consensus there to make them work in harmony is just as important as on-chain consensus

I am agnostic as to whether BTC or some Alt takes the crown, but there you have it BTC can implement solutions now,

The bigger issue writ large ::

If BTC cannot even now take steps to address the blocksize issue, when solutions abound, how then can any meaningful dev take place to improve the utility of BTC?

Its up to you to see the writing on the wall or go down with the ship.

Though bitcoin is experiencing this kind of problems but it doesnt mean that it will be the end of bitcoin. Even if there are no solutions to the problem there are already alternative ways that we can do so we can adjust to the problems. One possible answer is like what blockchain.info wallets did and it is to set up measures within the site. They are having a low mining fee and if we use both blockchain.info wallets the bitcoin will appear in our balance even if it is not confirmed yet.

[dinofelis]

They are having a low mining fee and if we use both blockchain.info wallets the bitcoin will appear in our balance even if it is not confirmed yet.

That's banking.  The bank is called blockchain.info.  You are not handling bitcoin, but a bitcoin IOU. 

[LoyceV]

I disagree. The current altcoin rise is based on pure pump speculation from
statements such as yours, which only feeds into what they are attempting.

You could argue the same from Bitcoin. If everybody dumps it, it's worthless, and if everybody wants it, it's value grows exponentially.
I really hate that for the first time since I'm using Bitcoin, I feel like I'm losing confidence in it. This is entirely caused by the limited blockspace. Transactions got 50 times more expensive in 2 years, and this isn't going to improve any time soon.
Bitcoin is losing market share to altcoins, and many altcoins are now in the bubble-area Bitcoin was 3-4 years ago.

In my humble opinion, Bitcoin needs to improve on a technical level before it's being overtaken.

Of course not.  Simply because bitcoin is first mover and more known.  Bitcoin is immensely OVERPROTECTED cryptographically.

I never thought of it this way. It's always argued a high difficulty and high hash rate is needed to protect Bitcoin, but indeed, you have a point. All the Bitcoin hashing power could easily be used to hijack an altcoin, but that too doesn't happen. The whole 51%-attack-fear seems overrated.
Meanwhile, Bitcoin mining consumes vast amounts of energy, mainly from relatively dirty power plants in China.

So, if we really want to have faster transactions, then we have to pay higher fees, and if we are only willing to pay low transaction fees, then we have no right to complain if we are going to wait till our transactions to be confirmed.

Paying more fees doesn't change the fundamental problem: Bitcoin can't handle enough transactions at the moment. If we all decide to pay 100 times more fees (keep in mind it already went up a lot!), we're still waiting just as long! The only result will be that some people can't afford their transaction anymore, and drop out. That

[Tigggger]

The second statement is:
"Given that the actual bitcoin protocol is blocks of 1MB, and that the only agents capable of modifying this, are miners (they make the blocs !), in order for this potentially to happen, there has to be a huge consensus between miners to do so, and to do so with the same protocol change ; this won't happen, because there is NO incentive AT ALL for ANY MINER to go to bigger blocs and release pressure on the fee market".

You said what I was trying to more eloquently, so have cut the rest out.

Can you expand on this paragraph, and the reason you think that pools seem to be the ones driving the charge to larger blocks and thereby releasing the fee pressure. I get that is the reason they don't want Segwit/LN, but then why are they supporting BU or similar alternatives. Is it just the only tool they have to fight Segwit/LN and they have no intention of actually going through with it, ie it's all a big bluff.

I don't btw, scaling isn't that big of a problem, and increased usage outweighs any short terms pitfalls, and the pitfalls are relatively easy to manage by just going slowly.

[gentlemand]

In other words, the original lowering of the bloc size from 32 MB to 1 MB, to "allow poor suckers to use bitcoin over their 56kb lines" is totally BS.  But now that that 1 MB limit is part of the protocol, the only people that could, eventually, decide to lift it, the miners, have absolutely no reason to remove that bonus for them, not with bigger blocs, and not with a second tier network.  

Miners don't need small fish adoption.  They want big whale usage of bitcoin, with few transactions of large amounts, and the current protocol is perfect for that.  It didn't need to be so, but by error or by intend, it has been designed that way, and they would be crazy to remove this.

Small fish are what got Bitcoin where it is today and they still sustain it. It's not a creation of big whales and I can't see much sign of them being present so far.

If all of this was taking place ten years in the future then it begins to make sense but miners would be very dim to count on an outcome that hasn't arrived yet. Small fish may walk away leaving nothing for whales to pick up.

[dinofelis]

Small fish are what got Bitcoin where it is today and they still sustain it.

First part, yes, second, no, I don't think so any more.  It is now a whale's sports.  Look, about 2 million bitcoin users, market cap 20 billion, AVERAGE bitcoin holding hence $10 000.  Apply power-distribution law Pareto style, and you see who is important.
If you're below $100 000,- you're not counting. 

[BillyBobZorton]

The original Bitcoin code handled 32MB blocks.

When there were 2 people worldwide using Bitcoin, it could handle 32 MB blocks, but all the blocks were 1 kB or less at that stage. Because only 2 people were using it


When dozens began to use it, the same person who allowed 32 MB network messages (there was, in fact, no explicit limit on blocksize at all, it was "unlimited") changed their mind, and added the 1MB blocksize limit.


All of which you know, you lying scammy little shit

i find it weird that satoshi didn't forecast the increase in usage and thus making the limit to 1MB since the beginning, also if he changed it later it mean that he hard forked bitcoin?

or maybe when you diminish it you don't need to hard fork(it would work as a opposite to ram increase in VMware for example you don't need to close the VM...), but i always thought that bitcoin was never hard forked

Hard forks aren't a problem when nobody gives a fuck about your software.

Hard forks are a big problem when there are 20 billion dollars invested in the technology.

Pretty simple to understand why hard fork are terrible idea. Even satoshi himself said he wouldn't like to see his software forked.

[dinofelis]

Hard forks aren't a problem when nobody gives a fuck about your software.

Hard forks are a big problem when there are 20 billion dollars invested in the technology.

Pretty simple to understand why hard fork are terrible idea. Even satoshi himself said he wouldn't like to see his software forked.

Normally, a hard fork splits the market cap over the two branches, because all previous owners now have the two coins in equal amounts. 

[gentlemand]

First part, yes, second, no, I don't think so any more.  It is now a whale's sports.  Look, about 2 million bitcoin users, market cap 20 billion, AVERAGE bitcoin holding hence $10 000.  Apply power-distribution law Pareto style, and you see who is important.
If you're below $100 000,- you're not counting. 

The number of people with that much skin in the game can't be more than a few tens of thousands at best. If they try to operate in a vacuum then they're not going to get very far. I don't see how long it could survive as a pure top down deal.

[dinofelis]

First part, yes, second, no, I don't think so any more.  It is now a whale's sports.  Look, about 2 million bitcoin users, market cap 20 billion, AVERAGE bitcoin holding hence $10 000.  Apply power-distribution law Pareto style, and you see who is important.
If you're below $100 000,- you're not counting.  

The number of people with that much skin in the game can't be more than a few tens of thousands at best. If they try to operate in a vacuum then they're not going to get very far. I don't see how long it could survive as a pure top down deal.

Well, they can sustain a certain time the "greater fool game" between big fish.  But in the end, it will just become a currency, but for very big amounts and relatively few transactions, used between big financial players to settle their unregulated financial affairs.  Then, Fisher's formula applies.  It is then a currency, but for big stuff.  For instance, circuits between exchanges, online casinos, dark markets and (big) private investors, to whitewash dark market money.
Or banking and big online stores like Amazon in war-prone and unstable regions where one cannot count on the legal system.  
You can think of many examples where one cannot count on the legal system to make sure that value can be transferred between big players.

There is more chance for this to "go in circles" than to have a fully closed economy with normal goods and services.

[manselr]

Hard forks aren't a problem when nobody gives a fuck about your software.

Hard forks are a big problem when there are 20 billion dollars invested in the technology.

Pretty simple to understand why hard fork are terrible idea. Even satoshi himself said he wouldn't like to see his software forked.

Normally, a hard fork splits the market cap over the two branches, because all previous owners now have the two coins in equal amounts. 

Yesh, and both branches suffer from a massive crash. To original devs always win because they are usually the best. All we get is to delay bitcoin progress for more than 3 years as well as poorer holders.

[eddie13]

The question in my mind is, how big of a dump is it going to take for something to be done about scailability?

Will it be worth the risk when BTC is $750? $300? $3?

Getting close..

[The One]

The original size was 32mb block.

Simply raising it to 4mb would solve the issue for now until the 4mb is used up.

Then raise it to 8mb... 12mb... 16mb... so and so.

Stop fannying around on stupid wallet features that are pointless.

Make it clear to the miners that it is in their interest that the blocksize goes up so the value of BTC can grow. All this stupid pathetic argument and division does nothing but puts off newbies, business users etc.

[jonald_fyookball]

The original size was 32mb block.

Simply raising it to 4mb would solve the issue for now until the 4mb is used up.

Then raise it to 8mb... 12mb... 16mb... so and so.

Stop fannying around on stupid wallet features that are pointless.

Make it clear to the miners that it is in their interest that the blocksize goes up so the value of BTC can grow. All this stupid pathetic argument and division does nothing but puts off newbies, business users etc.

Well, yeah...of course.

But if people wouldn't listen to Gavin (the man Satoshi himself chose to lead Bitcoin), they won't listen to you or I.

Core has decided to be opposed to be on-chain scaling.