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Author Topic: Block Size Scalability Issues  (Read 525 times)
Rath_
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August 31, 2018, 09:18:22 AM
 #21

Also, miners might start to supplement their income by hosting LN Nodes and getting fees from forwarding people's tx's. If they stop mining, then the Lightning Network will stop functioning and they will not get any fees from both the LN and the miners fees from their Bitcoin mining.

So in my opinion the Lightning Network actually supplement their income or it might just balance it out, when the Block reward decline. Huh

I don't think if setting up Lightning Nodes will be profitable for them. Lightning Network earnings are quite small and might not be worth the hassle of balancing thousands of channels. If some miners decided to stop mining due to low profitability then the difficulty would drop resulting in higher profit for those who continued to mine. None second-layer solution will replace on-chain transactions. Miners will continue to earn from on-chain fees. What is more profitable for an average miner? Small blocks and spikes in transaction fees or big blocks and small fees?
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The Bitcoin network protocol was designed to be extremely flexible. It can be used to create timed transactions, escrow transactions, multi-signature transactions, etc. The current features of the client only hint at what will be possible in the future.
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August 31, 2018, 09:42:35 AM
 #22

Also, miners might start to supplement their income by hosting LN Nodes and getting fees from forwarding people's tx's.

The good thing about the LN is that anyone can open a big amount of channels to get payed to route a payment.
You don't need specialized hardware and electricity costs far below the average to compete and earn money.

You just have to provide a funded channel to route the payment. So anyone (including miner) can participate the same way.



Lightning Network earnings are quite small and might not be worth the hassle of balancing thousands of channels.

They are small (or non-existent) at the moment.
But once LN is 'released' and truly tested and fully developed, the fees will increase when the user base and transaction made there increases.

These tx fees will still be way lower than the fees from on-chain tx's, but balancing thousands of channels should definitely make it worth it (at a stage where the LN is fully functional and used).

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September 01, 2018, 02:06:04 PM
 #23

Also, miners might start to supplement their income by hosting LN Nodes and getting fees from forwarding people's tx's. If they stop mining, then the Lightning Network will stop functioning and they will not get any fees from both the LN and the miners fees from their Bitcoin mining.

So in my opinion the Lightning Network actually supplement their income or it might just balance it out, when the Block reward decline. Huh

I don't think if setting up Lightning Nodes will be profitable for them. Lightning Network earnings are quite small and might not be worth the hassle of balancing thousands of channels. If some miners decided to stop mining due to low profitability then the difficulty would drop resulting in higher profit for those who continued to mine. None second-layer solution will replace on-chain transactions. Miners will continue to earn from on-chain fees. What is more profitable for an average miner? Small blocks and spikes in transaction fees or big blocks and small fees?

They are obviously not going to have 1 or 2 channels, but 1000's. The point is, the Lightning Network is not taking away miners fees for them, if they are also hosting Lightning Network nodes. It is a complete change for some of them, but it will supplement income if the Block reward falls away.

Millions of small tx's can also be profitable, even if it is still "small" now. The bigger picture is a business plan change from mining "Only" Bitcoin with ASIC's to a combination, where the miners also host Lightning Network nodes. <Obviously not on the ASICs>  Roll Eyes

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September 01, 2018, 04:21:25 PM
 #24

They are obviously not going to have 1 or 2 channels, but 1000's. The point is, the Lightning Network is not taking away miners fees for them, if they are also hosting Lightning Network nodes. It is a complete change for some of them, but it will supplement income if the Block reward falls away.

Keep in mind that the Lightning Network makes new type of payments cost-effective. We would never see so many micro-payments on-chain. Miners in fact benefit from this by confirming transactions which open and close channels. Lightning Network implementations are going to get better and better. Autopilot is not perfect and it can't take care of channel balancing which is important long-term. It should change in the next few years.
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September 02, 2018, 09:47:43 PM
 #25

I don't think that the block size is much of a problem for scalability. Many new coins are looking to implement a dynamic block size in the future upgrades, and several ICOs are offering coins with dynamically scaled blockchains. Personally, I believe that the scaling solution will come from an off-chain solution via offline payment channels, so we can even stay at the same block size we're at now without much detriment.

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September 03, 2018, 09:31:01 AM
 #26

Good that I found this thread. I have been asking this question on r/bitcoin with no real answer. How is that LN will not cause centralization.

As I understand(Please correct if I am wrong) inorder for me to send BTC from A to B, I need to open the channel. So as a user I would have to do the same thing again If I have to send BTC from A to C (Unless B already has an open channel with C).

I think in long run we will see centralized points which have multiple open channel that users would connect to.

I know people dont like it but BCH atleast has a solution or even variable/flexible blocksize would solve in much better case.
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September 03, 2018, 09:50:41 AM
 #27

As I understand(Please correct if I am wrong) inorder for me to send BTC from A to B, I need to open the channel. So as a user I would have to do the same thing again If I have to send BTC from A to C (Unless B already has an open channel with C).

You have to open a channel, yes. But you don't have to open the channel directly with B. You can open a channel with anyone (X) as long as there is a route from X to B.



I think in long run we will see centralized points which have multiple open channel that users would connect to.

That would be fine too. This wouldn't cause a problem at all.
Those hubs don't have any influence or 'power'. If you don't want to connect to them (e.g. because big hubs or fees), don't do it.

People can choose who they connect to.



I know people dont like it but BCH atleast has a solution or even variable/flexible blocksize would solve in much better case.

It's not really a solution. They postpone the problem.
Increasing a variable (blocksize) can never be a scaling solution.

A lot of new problems appear with a bigger blocksize which shouldn't be ignored.

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September 03, 2018, 03:57:39 PM
 #28

It's hard to avoid centralized centered LN nodes since merchants or nodes with high liquidity/balance naturally would have high connected channel since people would open new channel (merchant) if there aren't any available path/route and there's fewer available path/route (merchants & nodes with high liquidity/balance) if you intend to use LN for bigger payment.

The Lightning Network was designed to handle mostly micro-payments. The maximum amount of bitcoins you can send right now (in a single transaction) is about 0.041 BTC. The issue you mentioned can be solved by introducing multi-path payments which are being developed. It's still a bit unsafe to open a few big channels since there is no proper backup feature in many wallets. I would wait for eltoo with that. Lightning Network still needs some time for development but given the fact that there are so many nodes, there shouldn't be any problems with its adoption.
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September 04, 2018, 06:32:32 AM
 #29


That would be fine too. This wouldn't cause a problem at all.
Those hubs don't have any influence or 'power'. If you don't want to connect to them (e.g. because big hubs or fees), don't do it.

People can choose who they connect to.

Yea, I dont think that would be fine. People can connect to what ever they want until they have options to connect. When they dont have they would have to connect to these centralized points/


It's not really a solution. They postpone the problem.
Increasing a variable (blocksize) can never be a scaling solution.

A lot of new problems appear with a bigger blocksize which shouldn't be ignored.


Agreed, its not a solution but better then 1Mb block. Minor update to 2Mb or 4Mb would have solved lot of pressure when backlogs were high.
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September 04, 2018, 06:43:31 AM
 #30


You won't get able any answer if you show pessimism/negative views towards Bitcoin on r/bitcoin. You better ask this forum or


Actually I did get an answer but not a proper one. Dont know if it was an admin but whoever it was said he will get back to me and never did. Then again its not a customer service but thats ok.

Still to point out, How does it matter if I was showing negative view?
Is current structure so weak that it wont stand any criticism?


It's hard to avoid centralized centered LN nodes since merchants or nodes with high liquidity/balance naturally would have high connected channel since people would open new channel (merchant) if there aren't any available path/route and there's fewer available path/route (merchants & nodes with high liquidity/balance) if you intend to use LN for bigger payment.

This thread Basics of the Lightning Network - explanation and wallets should give you more information.

I know, that's my concern. I dont have anything better to offer but I can point out what I see as an upcoming problem.


It's not really a solution. They postpone the problem.
Increasing a variable (blocksize) can never be a scaling solution.

A lot of new problems appear with a bigger blocksize which shouldn't be ignored.


What kind of problem are you referring to. I would like to read something on it.
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September 04, 2018, 06:51:41 AM
 #31

Yea, I dont think that would be fine. People can connect to what ever they want until they have options to connect. When they dont have they would have to connect to these centralized points/

But people CAN choose.
They CAN connect to whoever they want. That's the point.

Hubs are being built if people want to build them. And also.. note that Hubs are still decentralized. There is a difference between decentralized and distributed.
While the LN probably won't be completely distributed, it WILL be and currently IS decentralized.



Agreed, its not a solution but better then 1Mb block. Minor update to 2Mb or 4Mb would have solved lot of pressure when backlogs were high.

SegWit introduced the block weight.
With 100% segwit transactions, there is room for 4x more transactions inside a block than pre-segwit.

Currently, blocks are about 2,4 MB big (incl. witness data).

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