How scalable is bitcoin?

[Bernard Lerring]

Suppose bitcoin goes megastrophic over the next couple of years.

Suppose 1 BTC is worth 13 semi-detached houses, in Runcorn.

Suppose people will be buying 4K-4D televisions, tins of cheesy-peas, internet enabled kettles, hover jigsaws and grandma will be buying her Readers Digest in BTC.

This would make the small items a fraction of a BTC, you get my over laboured point by now.

How many digits can we go down past a Satoshi? A Satoshi is 0.00000001 BTC, I think.

Is the protocol infinitely scalable, or is there a limit to the amount of decimal places without a rework of the blockchain?


_{Copyright, Alan Partridge.}

[BitCoinDream]

Suppose bitcoin goes megastrophic over the next couple of years.

Suppose 1 BTC is worth 13 semi-detached houses, in Runcorn.

Suppose people will be buying 4K-4D televisions, tins of cheesy-peas, internet enabled kettles, hover jigsaws and grandma will be buying her Readers Digest in BTC.

This would make the small items a fraction of a BTC, you get my over laboured point by now.

How many digits can we go down past a Satoshi? A Satoshi is 0.00000001 BTC, I think.

Is the protocol infinitely scalable, or is there a limit to the amount of decimal places without a rework of the blockchain?


_{Copyright, Alan Partridge.}

Currently the protocol supports till 10^(-8), but it can go beyond, probably till 64-bit IEEE 754 floating point.

[DannyHamilton]

Suppose bitcoin goes megastrophic over the next couple of years.

Suppose 1 BTC is worth 13 semi-detached houses, in Runcorn.

Suppose people will be buying 4K-4D televisions, tins of cheesy-peas, internet enabled kettles, hover jigsaws and grandma will be buying her Readers Digest in BTC.

This would make the small items a fraction of a BTC, you get my over laboured point by now.

How many digits can we go down past a Satoshi? A Satoshi is 0.00000001 BTC, I think.

Is the protocol infinitely scalable, or is there a limit to the amount of decimal places without a rework of the blockchain?


_{Copyright, Alan Partridge.}

Currently the protocol supports till 10^(-8), but it can go beyond, probably till 64-bit IEEE 754 floating point.

That answer is half correct.

Currently the protocol supports 10^-8.

However, it is highly unlikely that the protocol will use floating point for representing value.  It is generally safer to work with integers.

If a need arises to work with something smaller than 10^-8, it will require a protocol change. The code changes won't be difficult, but I suspect reaching a consensus on exactly how it should be changed will be difficult.

[Velkro]

there is no need to worry about that, before smth will eventually need to be done, there will be a lot of time to do that

[Kprawn]

And we do not need to all be mathematicians to be able to work out what change to give.

People already struggle with fiat, now tell them to go back 6 decimals, and they will never adopt this currency, because they to lazy to think. 

[DannyHamilton]

And we do not need to all be mathematicians to be able to work out what change to give.

People already struggle with fiat, now tell them to go back 6 decimals, and they will never adopt this currency, because they to lazy to think. 

Fortunately, people have always been very good at creating nicknames for their money. So, if something costs 0.000000003 BTC, people aren't going to say "three billionths of a bitcoin", or even "point zero zero zero zero zero zero zero zero three bitcoins".  Instead, they'll create a nickname for 0.000000001 BTC (perhaps "nanobitcoins", or "nanoes", or "nans"), and they'll say something like "three nans".  Likewise, 0.000000412 could be "four hundred twelve nans".

[jbrnt]

IMO, moving the decimal point is not the hurdle in scaling bitcoin. It's the block time, and the actual (not theoretical) number of transactions per minute on the network. It's my impression that mining pools wants to include the least number of transactions and mine a block as small as allowed. 

[cbeast]

IMO, moving the decimal point is not the hurdle in scaling bitcoin. It's the block time,

If you mean the ten minute intervals between blocks, that has to do with network propagation. Even if the internet itself speeds up, the number of miners also increases exponentially. It's best to be conservative with confirmation and ten minutes is more than reasonable for typical online purchases, large purchases, and money transfers. Zero confirmation purchases are fine for small amounts.

and the actual (not theoretical) number of transactions per minute on the network. It's my impression that mining pools wants to include the least number of transactions and mine a block as small as allowed. 

The number of transactions can be increased by increasing the block size. Mining pools include transactions with fees.

[jbrnt]

The number of transactions can be increased by increasing the block size. Mining pools include transactions with fees.

Thanks for your explanation. I understand how increasing the block size limit can increase the theoretical maximum of transactions. What I am concerned about is, mining pools prefers to mine a small block with less transactions and receive less fee, than to mine a large block to receive more fees and run the risk of not mining the block, or get orphaned.

I was reading another thread some time ago, saying there isn't a parameter to set minimum block size. So, raising block size limit may have little to no effect on raising actual transaction volume.

[FattyMcButterpants]

it would be possible to change the protocol to allow for transactions involving less than a satoshi, but it may not be necessary. i'm not convinced that, in time, BTC will be used as a day-to-day currency, for buying TVs and such. more so for settling of accounts, large value money transfer.

[cbeast]

The number of transactions can be increased by increasing the block size. Mining pools include transactions with fees.

Thanks for your explanation. I understand how increasing the block size limit can increase the theoretical maximum of transactions. What I am concerned about is, mining pools prefers to mine a small block with less transactions and receive less fee, than to mine a large block to receive more fees and run the risk of not mining the block, or get orphaned.

I was reading another thread some time ago, saying there isn't a parameter to set minimum block size. So, raising block size limit may have little to no effect on raising actual transaction volume.

We'll see in 2016 when the block reward halves if the mining pools still prefer small blocks without fees.

[Bernard Lerring]

I feel that my generation (30 something's) and below won't have a problem with using terminology like nano's, or whatever language develops for small transactions. It's the generation above that may be left behind.

People younger than my generation will surely not have a problem, especially when smartphone bitcoin apps become a bit more sophisticated and user friendly on a non techy level.