Blocks are [not] full. What's the plan?

[Carlor]

and we can easily support more TPS than PayPal.

Off course, but that comes at a cost. I think Paypal is a good target because it's about internet payments that does not require very rapid confirmations. We could aim for a little more than paypal  and choose, for instance, a max block size that allows 1.2 or 1.5 of the paypal tps (so 12 or 15 mB).

On the other hand, I think that we should just forget about being able to address the same number and types of transactions visa or mastercard do. Such kind of transactions (super-market, bar, etc.) have to be made off-chain. First because they require rapid confirmations. Second, because it is useless to register everything into the blockchain (I don't want to have even the coffee I buy registered into the blockchain. In fact, the less transactions inside the block chain, the better).

Best regards,
ilpirata79

That is imho the worst approach. It takes one of bitcoins key features away, being a very simple and clear system.
Imho, you have to be able to pay your coffee without any intermediaries to keep bitcoin alive and to have a real impact on the world.
Cutting out intermediaries and making transactions cheap and fast, that was the approach described in the paper and I think this should stay bitcoins goal.
Allowing the same number of transactions as visa should be the midterm goal imho. I started using bitcoin quite regularly as shops start to accept it more and more and I definitely don't want this trend to stop. This is the real value growth of bitcoin, not some overheated numbers caused by speculation.

[ilpirata79]

and we can easily support more TPS than PayPal.

Off course, but that comes at a cost. I think Paypal is a good target because it's about internet payments that does not require very rapid confirmations. We could aim for a little more than paypal  and choose, for instance, a max block size that allows 1.2 or 1.5 of the paypal tps (so 12 or 15 mB).

On the other hand, I think that we should just forget about being able to address the same number and types of transactions visa or mastercard do. Such kind of transactions (super-market, bar, etc.) have to be made off-chain. First because they require rapid confirmations. Second, because it is useless to register everything into the blockchain (I don't want to have even the coffee I buy registered into the blockchain. In fact, the less transactions inside the block chain, the better).

Best regards,
ilpirata79

That is imho the worst approach. It takes one of bitcoins key features away, being a very simple and clear system.
Imho, you have to be able to pay your coffee without any intermediaries to keep bitcoin alive and to have a real impact on the world.
Cutting out intermediaries and making transactions cheap and fast, that was the approach described in the paper and I think this should stay bitcoins goal.
Allowing the same number of transactions as visa should be the midterm goal imho. I started using bitcoin quite regularly as shops start to accept it more and more and I definitely don't want this trend to stop. This is the real value growth of bitcoin, not some overheated numbers caused by speculation.

I think you will never be able to pay coffee with bitcoins, when (and if) people really start using it (which is what we want). Unless you are willing to pay very high fees.

For this kind of (micro) payments we could follow the approach I described here, which leverages micro-payment channels in course of development: https://bitcointalk.org/index.php?topic=344267.0.

Best regards,
ilpirata79
 

[gmaxwell]

I think you will never be able to pay coffee with bitcoins, when (and if) people really start using it (which is what we want). Unless you are willing to pay very high fees.

I think you should be careful to distinguish Bitcoin the currency and Bitcoin the payment network when you speak because on this matter what you can "never" do is quite different depending on which you're speaking of— I know you know this but the language makes it unclear.

[ilpirata79]

I think you will never be able to pay coffee with bitcoins, when (and if) people really start using it (which is what we want). Unless you are willing to pay very high fees.

I think you should be careful to distinguish Bitcoin the currency and Bitcoin the payment network when you speak because on this matter what you can "never" do is quite different depending on which you're speaking of— I know you know this but the language makes it unclear.

Off-course, I meant that the coffee transaction does not end up being written into the block-chain, but you *still* are paying with bitcoins (through other means). After all, the block chain is just a distributed time stamp server. There is no need to put everything in there.  So, if you can achieve the same goal (pay) through more efficient means, it is ok.
Thanks anyhow for the clarification you made which is very useful.

Best regards,
ilpirata79

[Carlor]

and we can easily support more TPS than PayPal.

Off course, but that comes at a cost. I think Paypal is a good target because it's about internet payments that does not require very rapid confirmations. We could aim for a little more than paypal  and choose, for instance, a max block size that allows 1.2 or 1.5 of the paypal tps (so 12 or 15 mB).

On the other hand, I think that we should just forget about being able to address the same number and types of transactions visa or mastercard do. Such kind of transactions (super-market, bar, etc.) have to be made off-chain. First because they require rapid confirmations. Second, because it is useless to register everything into the blockchain (I don't want to have even the coffee I buy registered into the blockchain. In fact, the less transactions inside the block chain, the better).

Best regards,
ilpirata79

That is imho the worst approach. It takes one of bitcoins key features away, being a very simple and clear system.
Imho, you have to be able to pay your coffee without any intermediaries to keep bitcoin alive and to have a real impact on the world.
Cutting out intermediaries and making transactions cheap and fast, that was the approach described in the paper and I think this should stay bitcoins goal.
Allowing the same number of transactions as visa should be the midterm goal imho. I started using bitcoin quite regularly as shops start to accept it more and more and I definitely don't want this trend to stop. This is the real value growth of bitcoin, not some overheated numbers caused by speculation.

I think you will never be able to pay coffee with bitcoins, when (and if) people really start using it (which is what we want). Unless you are willing to pay very high fees.

For this kind of (micro) payments we could follow the approach I described here, which leverages micro-payment channels in course of development: https://bitcointalk.org/index.php?topic=344267.0.

Best regards,
ilpirata79
 

I hope -and I'm relatively certain- that I will be (still!) able to do that in the future and imho any solution away from allowing a lot of cheap and fast transactions on the blockchain will be a major threat to bitcoins integrity. I know that "off the chain" transactions are hip these days, but imho this takes away a huge and major feature of bitcoin, NO intermediaries. This point can not be stressed enough. Taking away any kind of intermediary between people is one of the big pluses of bitcoin.
I don't want bitcoin companies between me and the bitcoin network, I want to participate in the network itself. I could just keeping my credit cards then.

Imho off the chain transactions are no solution at all, they are a way of complicating things.

[ilpirata79]

I hope -and I'm relatively certain- that I will be (still!) able to do that in the future and imho any solution away from allowing a lot of cheap and fast transactions on the blockchain will be a major threat to bitcoins integrity. I know that "off the chain" transactions are hip these days, but imho this takes away a huge and major feature of bitcoin, NO intermediaries. This point can not be stressed enough. Taking away any kind of intermediary between people is one of the big pluses of bitcoin.
I don't want bitcoin companies between me and the bitcoin network, I want to participate in the network itself. I could just keeping my credit cards then.

Imho off the chain transactions are no solution at all, they are a way of complicating things.

Off-chain transactions for small or micro payments does not forbid you to send  money to a friend of yours directly (through the blockchain - you may just have to pay a relatively high fee).

The problem is that one thing if what we want, another thing is what we actually CAN have. World is made of constraints. You just cannot record everything, but in any case why would you do that? I don't care if my coffee transaction does not get into the block chain (as a single transaction). Intermediares that lower the required fees and speed up transaction times are just good.

Consider that such intermediares (that I call payment gateways) could even increase user privacy, by aggregating several small transactions into a big one where the information about the component transactions is lost.

Best regards,
ilpirata79


 

[Carlor]

Off-chain transactions for small or micro payments does not forbid you to send  money to a friend of yours directly (through the blockchain - you may just have to pay a relatively high fee).

Yes and one of Bitcoins big advantages are the small fees. A cheap, fast payment system without the need of intermediaries, that is one huge part of bitcoin imho.

The problem is that one thing if what we want, another thing is what we actually CAN have. World is made of constraints. You just cannot record everything, but in any case why would you do that? I don't care if my coffee transaction does not get into the block chain (as a single transaction). Intermediares that lower the required fees and speed up transaction times are just good.

We can have bitcoins without intermediaries. I care if I depended on an intermediary. I don't want companies between me and my money or the money transfer system. I can have that already, it's called a credit card . There is no problem with recording everything. Disk space is already very cheap and it gets cheaper and cheaper. If you have concerns about your privacy, I can guarantee you, that these intermediaries will be obligated to track everything, so you might have less privacy than with the existing system, which gives you enough room for anonymity if you really care. Intermediaries make the system unnecessary complicated. And they are absolutely not needed.

Consider that such intermediares (that I call payment gateways) could even increase user privacy, by aggregating several small transactions into a big one where the information about the component transactions is lost.

PayPal can be called payment gateway as well. For example, if we installed some kind of "no small transactions" system, there is a big chance, that companies like Ebay become these intermediaries. And as I stated above, there will be no privacy as soon as there is some kind of controllable intermediary.

I'm not saying I have the perfect solution, but there are some test-worthy ideas out there and there is no technical reason to limit transactions on the blockchain.

[justusranvier]

Off chain transactions are not a solution.

For one thing, off-chain transactions means giving up every advantage of Bitcoin - you're now stuck working through some kind gatekeeper service which has the ability to exercise prior restraint (censorship) and probably chargebacks and funds confiscation.

It's especially pernicious when there are about 7 billion people in the world who haven't got a chance to buy Bitcoins yet and they are the ones who most desperately need censorship-resistant money. The proponents of the small static blocksize are effectively locking them out of the benefits of Bitcoin forever.

Secondly, we need massive amounts of transactions on the blockchain in order to generate massive transaction fee revenue in order to pay for the hashing power we need to secure Bitcoin against attackers with nation state-level resources.

Bitcoin won't stay free with small blocks. There's no route to that outcome without sucking it up and making large blocks work.

[Carlor]

Off chain transactions are not a solution.

For one thing, off-chain transactions means giving up every advantage of Bitcoin - you're now stuck working through some kind gatekeeper service which has the ability to exercise prior restraint (censorship) and probably chargebacks and funds confiscation.

It's especially pernicious when there are about 7 billion people in the world who haven't got a chance to buy Bitcoins yet and they are the ones who most desperately need censorship-resistant money. The proponents of the small static blocksize are effectively locking them out of the benefits of Bitcoin forever.

Secondly, we need massive amounts of transactions on the blockchain in order to generate massive transaction fee revenue in order to pay for the hashing power we need to secure Bitcoin against attackers with nation state-level resources.

Bitcoin won't stay free with small blocks. There's no route to that outcome without sucking it up and making large blocks work.

Thank you, Sir!

[ilpirata79]

Off-chain transactions for small or micro payments does not forbid you to send  money to a friend of yours directly (through the blockchain - you may just have to pay a relatively high fee).

Yes and one of Bitcoins big advantages are the small fees. A cheap, fast payment system without the need of intermediaries, that is one huge part of bitcoin imho.

The problem is that one thing if what we want, another thing is what we actually CAN have. World is made of constraints. You just cannot record everything, but in any case why would you do that? I don't care if my coffee transaction does not get into the block chain (as a single transaction). Intermediares that lower the required fees and speed up transaction times are just good.

We can have bitcoins without intermediaries. I care if I depended on an intermediary. I don't want companies between me and my money or the money transfer system. I can have that already, it's called a credit card . There is no problem with recording everything. Disk space is already very cheap and it gets cheaper and cheaper. If you have concerns about your privacy, I can guarantee you, that these intermediaries will be obligated to track everything, so you might have less privacy than with the existing system, which gives you enough room for anonymity if you really care. Intermediaries make the system unnecessary complicated. And they are absolutely not needed.

Consider that such intermediares (that I call payment gateways) could even increase user privacy, by aggregating several small transactions into a big one where the information about the component transactions is lost.

PayPal can be called payment gateway as well. For example, if we installed some kind of "no small transactions" system, there is a big chance, that companies like Ebay become these intermediaries. And as I stated above, there will be no privacy as soon as there is some kind of controllable intermediary.

I'm not saying I have the perfect solution, but there are some test-worthy ideas out there and there is no technical reason to limit transactions on the blockchain.

I don't have time to completely argument, however, in brief:

1) No problem with credit cards or debit card: I already use them. I could just as easily use them with bitcoins. The issue is the fees that should be low.

2) Paypal is not a payment gateway, but a payment processor. It handles each transaction entirely. Both sender and receiver need to be registered on it. I propose instead a network of interoperable payment gateways where each user can choose its gateway (the cheaper or faster or trustworthy, even if the trust needed if almost zero). To have a transaction among two people, they do not need to use the same gateway.

3) If you want privacy, you can just choose a payment gateway in a country where there is no need to record transactions. A payment gateway could even be located into TOR.


The bandwidth and the storage space issues have already been discussed. You cannot get away with it by just saying that storage is cheap... We must abandon this kind of religious thinking where we just hope that storage will get cheaper and network speed bigger just as much as we need.
Off course there are going to be advancements but the pace of such advancements is not goint to allow to cope with the huge increase of the number of transactions.
In any case, as I said before, you can still use direct transactions (but fees are going to be higher).


Best regards,
ilpirata79

[zvs]

I killed all my bitcoind nodes (@ approx 5:00PM CST).  I doubt it'll have any effect whatsoever on propagation, but I can't help but be a bit curious...

Anyone know what timezone the daily charts on http://bitcoinstats.com/network/propagation/ are based on?

2013/11/28     5.1 seconds   22.4 seconds   1.4 seconds   4.7 seconds
2013/11/29         6.0 seconds   35.0 seconds   1.7 seconds   6.5 seconds

hmm.  well, first off, i guess the average block size was bigger since the difficulty just went up.  but that's much higher than % of block size increase

anyway,

The bandwidth and the storage space issues have already been discussed. You cannot get away with it by just saying that storage is cheap... We must abandon this kind of religious thinking where we just hope that storage will get cheaper and network speed bigger just as much as we need.

my buffalo node had 5TB upstream used from bitcoind after 25 days, the hetzner used more  , when it wasn't being dos'ed or ddos'ed

[eyci]

The bandwidth and the storage space issues have already been discussed. You cannot get away with it by just saying that storage is cheap... We must abandon this kind of religious thinking where we just hope that storage will get cheaper and network speed bigger just as much as we need.
Off course there are going to be advancements but the pace of such advancements is not goint to allow to cope with the huge increase of the number of transactions.
In any case, as I said before, you can still use direct transactions (but fees are going to be higher).

I find nothing factually wrong with your point of view, but I can't help but feel that your approach to this problem is against the spirit of Bitcoin. Centralized systems requiring trust are generally cheaper to operate than decentralized ones - think for example of modern governments and the deadlock that they often find themselves in - the cost of a centralized system however is in the potential abuse of trust, monopolistic inefficiencies, etc.

The great innovation of Bitcoin is in allowing for a decentralized financial network at a relatively low cost. While you may be right in saying that the economics may not permit small transactions to go on the blockchain, our focus should be to push the limits of the technology to reduce costs, and then let the free market decide what the blocksize should be, rather than chastising people for having "this kind of religious thinking". Centralized payment systems on top of Bitcoin will always exist, it is up to the individual to decide if the cost of giving up autonomy is less than the cost of using Bitcoin directly, however we ought to do all we can to make centralized systems unnecessary.

I'm sorry if the debate on this issue has evolved significantly beyond this, please feel free to point me in the right direction.

[gmaxwell]

Centralized systems requiring trust are

You are presenting a false choice. The choice is not "centralized systems" OR "everything in Bitcoin". There are many options to build non-centralized ways of settling payment on a decentralized Bitcoin— ilpirata79 linked to one such approach. A lack of care into the operating costs of Bitcoin nodes may result in Bitcoin itself becoming effectively centralized, which is an outcome which would make building a non-centeralized payment method on top of Bitcoin pointless or impossible.

[Carlor]

Centralized systems requiring trust are

You are presenting a false choice. The choice is not "centralized systems" OR "everything in Bitcoin". There are many options to build non-centralized ways of settling payment on a decentralized Bitcoin— ilpirata79 linked to one such approach. A lack of care into the operating costs of Bitcoin nodes may result in Bitcoin itself becoming effectively centralized, which is an outcome which would make building a non-centeralized payment method on top of Bitcoin pointless or impossible.

The fear of bitcoin becoming centralized because of "heavy" nodes is imho completely unnecessary. The traffic and storage technology can be maintained by small groups, it is not like there will be "one big government node" in every country. It is more like having a node in every town.
Any system that requires a system on top of bitcoin for payments is a threat for bitcoin and it is not necessary. The basic, existing system of bitcoin allows to replace visa if it is adapted to a bigger volume.
Anything else will make Bitcoin complicated and I know I am repeating this, but one huge factor of bitcoin is, that I don't need an intermediary.
Keep Bitcoin simple, complicating systems unnecessarily has never been wise.

[johnyj]

The Bitcoin network is not in anyway like paypal or VISA, it is very similar to central banks issue moneys in big blocks and distribute them to the society. Just like the FED never issue credit cards, it is a waste of resource to use bitcoin to do micro payments, and in daily life, people really want to spend the fiat money first

Bitcoin won't replace fiat money, since their usage don't overlap: Fiat money is for spending, its value drops each passing year, and bitcoin is for saving, its value rises each passing year

Bitcoin is an unique addition to existing financial world and it will be welcomed by all the existing players, since it has the highest credibility on the planet and will be regarded as the most trustworthy store of value

If there is no cost to operate the bitcoin network, then bitcoin can also carry out  the mission of micro payments, but when the network traffic and computing power is a limited resource, there should be a focus on its major usage

[niothor]

Centralized systems requiring trust are

You are presenting a false choice. The choice is not "centralized systems" OR "everything in Bitcoin". There are many options to build non-centralized ways of settling payment on a decentralized Bitcoin— ilpirata79 linked to one such approach. A lack of care into the operating costs of Bitcoin nodes may result in Bitcoin itself becoming effectively centralized, which is an outcome which would make building a non-centeralized payment method on top of Bitcoin pointless or impossible.

The fear of bitcoin becoming centralized because of "heavy" nodes is imho completely unnecessary. The traffic and storage technology can be maintained by small groups, it is not like there will be "one big government node" in every country. It is more like having a node in every town.
Any system that requires a system on top of bitcoin for payments is a threat for bitcoin and it is not necessary. The basic, existing system of bitcoin allows to replace visa if it is adapted to a bigger volume.
Anything else will make Bitcoin complicated and I know I am repeating this, but one huge factor of bitcoin is, that I don't need an intermediary.
Keep Bitcoin simple, complicating systems unnecessarily has never been wise.

You know that visa offers some services that will never be replaced by bitcoin.
But visa might use bitcoin for those services.

[Carlor]

The Bitcoin network is not in anyway like paypal or VISA, it is very similar to central banks issue moneys in big blocks and distribute them to the society. Just like the FED never issue credit cards, it is a waste of resource to use bitcoin to do micro payments, and in daily life, people really want to spend the fiat money first

Bitcoin won't replace fiat money, since their usage don't overlap: Fiat money is for spending, its value drops each passing year, and bitcoin is for saving, its value rises each passing year

Bitcoin is an unique addition to existing financial world and it will be welcomed by all the existing players, since it has the highest credibility on the planet and will be regarded as the most trustworthy store of value

If there is no cost to operate the bitcoin network, then bitcoin can also carry out  the mission of micro payments, but when the network traffic and computing power is a limited resource, there should be a focus on its major usage

Bitcoins value just rises, because people believe it might become an alternative currency. It doesn't just rise because it is rare. In this case, all the people saying bitcoin is just another pyramid scheme would be right. All these systems declaring "this and this is now rare and we will sell it to you" failed. Bitcoin as value storage is a tech bubble, because it has no real usage.
Bitcoin as a currency has a real usage and thus it has a value. And I'm very happy, that the number of shops accepting bitcoin is growing, I don't want that to go backwards.
Bitcoin will definitely not be welcomed by the existing players. The players have their systems and they use them. They don't need a decentralized alternative. The people need that, not the banks.
Network traffic and computing power is a very, very, very cheap ressource. You don't keep your fiat, because the paper is "too expensive".

People who think, that bitcoin will be a "value storage" just because it's rare are believing the same bullshit people believed often enough. In this case, the "tulip mania" jerks are right, bitcoin differs in no way from all the other "value storages" that came up in history and went down.

Bitcoin was always designed to be a currency and the existing limits were never thought to be forever.
I don't want to see bitcoin as the next tech bubble and imho a lot of the "next value storage" "gold 2.0" talk sounds fatally like all the bullshit you can hear in EVERY investment bubble.

[PenAndPaper]

I 've read Gavin's answer on reddit about block size
http://www.reddit.com/r/Bitcoin/comments/1rqexb/87898_kb_block_just_now/

Hmm?

The block size must rise, but there are a couple of technical things that have to get done first:

1) Fees have to float. That's what I've been working on. 2) Broadcasting large blocks has to get more efficient. We know how, "we" just have to write the code ("use full bloom filters").

Then "we" will have to convince people that increasing the block size won't Doom Bitcoin To A Downward Spiral of Transaction Fees (just ain't true) or result in 100% Of Hashing Power in a Single Server Closet!

What does he mean when he says that "fees have to float" and also what's the concern of a "downward spiral of transaction fees"?

[Altoidnerd]

Perhaps I will be crucified here as I was at /r/bitcoin.  But have you considered the possibility that bitcoin is simply meant to be the currency for large transactions of money?  Perhaps millions of dollars?  You could buy a house or car with bitcoin.  But send your lunch money with peer coin.  To me, this is economically inevitable, and would serve to drive the price of bitcoin upward and push it in a position where it is a currency that is meant for large sums of money to be sent....which would be good, I think.  

What I am suggesting is that perhaps what happnens now is the altcoins play this role and finally become more than just, well, worthless.  Peercoin is perfect for sending $1 and bitcoin is no longer that great at it.  So what?  

[gmaxwell]

concern of a "downward spiral of transaction fees"?

If blocksize isn't scarce at all why not include every transaction that pays at least 1e-8 BTC which you've already received and validated?  If it's purely orphaning that influences your decision why won't all your spending go to bandwidth (neutrino links to other miners and such ) and none to POW? etc.