Gold collapsing. Bitcoin UP.

[cypherdoc]

Gold up.  Cypherdoc collapsing.

tvbcof:  "woof, woof!":

I thought for a minute that you may have figured out the incredibly complex technology required to make your images appropriately sized for your post (hint:  width={nnn} within the opening img tag.)  Guess not.

little dog means just that; little.

and btw, try using 880 as the value and tell me what your peabrain thinks.

[brg444]

About censorship:

The current mob campaigning against censorship is precisely the same group that has spent the last couple months downvoting censoring  each and every reasonable and perfectly valid argument brought against block size increase or any thing that did not fit in their groupthink.

For that reason I am thoroughly enjoying the little hissy fit they are now throwing

[laurentmt]

If my understanding of IBLT is correct, its main advantage is that the quantity of information transmitted on the wire is constant, whatever the number of transactions inside the block.

IMHO, it's fair to say that propagation of these data is not the whole story. There's a reconciliation to be done between the new block and the local mempool but I think it's also fair to make the hypothesis that with such a mechanism in place, mining pools may have an incentive to keep an exhaustive mempool (in order to avoid the burden of requesting missing transactions and to increase their performances/profits).

Anyway, I think we can say that with an IBLT, some operations will depend on the number of transactions (in mempool and new block) but for now, I don't know how the delay introduced by these operations would compare with the delay related to the propagation in the network (in term of order of magnitudes).

This study is very interesting, because from an engineering point of view, having a mechanism requiring constants resources (time or space) is the "holy grail" but according to your paper that may also imply the birth of an unhealthy fee market (and a new challenge for bitcoin .

As said many times by others, current solutions just kick the can down the road and a proper solution for propagation in the network remains to be found and implemented (imho the relay network should be considered as a temporary "patch" (no offense intended to its creator) and shouldn't become a replacement of the p2p network).

Understanding the economic consequences of future solutions is really needed before we decide to go down the road and not so much has been done until now. So, keep up the good work !

[Peter R]

If my understanding of IBLT is correct, its main advantage is that the quantity of information transmitted on the wire is constant, whatever the number of transactions inside the block.

IMHO, it's fair to say that propagation of these data is not the whole story. There's a reconciliation to be done between the new block and the local mempool but I think it's also fair to make the hypothesis that with such a mechanism in place, mining pools may have an incentive to keep an exhaustive mempool (in order to avoid the burden of requesting missing transactions and to increase their performances/profits).

...

Right, the reconciliation process will take time (information must be communicated), and the amount of time will have a lower limit proportional to the Shannon Entropy in the new block.  One could argue that the Shannon Entropy in a new block will not in general be proportional to the size of the block, but that doesn't make any sense to me.  In fact, the only way I can imagine that it would be possible is if the block solutions contain no information about the included transactions at all (i.e., the case of infinite coding gain).  But if there's no information communicated about the transactions included in a block, then in my opinion the miners aren't peers but slaves and the system is already centralized.  

If the network is composed of peers who build blocks based on their own volition, then I argue that information (Shannon Entropy) about the transactions contained within the new blocks must be communicated as part of the block solution.  If this is the case, the fee market will remain healthy (according to the definition of a healthy fee market given in feemarket.pdf).

[rocks]

That post you included above is utter nonsense as a reply. Thermos being downvoted into the ground is valid to point out because it demonstrates just how much the community disagrees.

And that is the thing you don't seem to understand, bitcoin is a community defined construct, it is whatever its users want it to be. Is is not defined by a FOMC like entity.

poor guy.. you are even more naive than I thought.

the point YOU (and quite a few here) dont seem to understand is that the reddit mob in no way, shape or form defines "the community".

if there is a consensus amongst anyone with half a brain it is that no sane discussions on the topic of the block size debate can be had over there. The post I included explain exactly while it is so.

now you can keep fooling yourself with delusions of community consensus or get a grip and realise that no amount of upvotes or downvotes will shift the balance in the outcome of this issue.

What is Bitcoin if not a community of individuals independently deciding to use and ascribe value to something other than government fiat money and to create their own construct for money.

Yours and the other dev's view of BitcoinXT, is no different from Krugman's and Yellen's view of Bitcoin. i.e. "You people can't define what is money because we already said it is this and anyone who disagrees is delusional". Well guess what, you are as delusional as Krugman and Yellen.

And yes, reddit is a more accurate view of the total bitcoin ecosystem then the dev's mailing list.

 And if not, that doesn't matter either, the whole point of Bitcoin is that I can make my own choices, and me and others are free to leave the current Bitcoin and choose our own path. If you don't want to transact on my chain, then fine, that is your choice, but I've already decided to not transact on yours.

[Erdogan]

Using logic, I can see two possible reason for being a block minimalist developer.

1)  Since "Uh oh, here it is we who decide the size of the blocks", because having power is good. Since there is no consensus within the self appointed dominator group, we have to wait until the royals can come to agreement.

2) They want to suffocate bitcoin, permanently if possible, to get a head start on their endevour into competing systems.

[cypherdoc]

If my understanding of IBLT is correct, its main advantage is that the quantity of information transmitted on the wire is constant, whatever the number of transactions inside the block.

IMHO, it's fair to say that propagation of these data is not the whole story. There's a reconciliation to be done between the new block and the local mempool but I think it's also fair to make the hypothesis that with such a mechanism in place, mining pools may have an incentive to keep an exhaustive mempool (in order to avoid the burden of requesting missing transactions and to increase their performances/profits).

Anyway, I think we can say that with an IBLT, some operations will depend on the number of transactions (in mempool and new block) but for now, I don't know how the delay introduced by these operations would compare with the delay related to the propagation in the network (in term of order of magnitudes).

This study is very interesting, because from an engineering point of view, having a mechanism requiring constants resources (time or space) is the "holy grail" but according to your paper that may also imply the birth of an unhealthy fee market (and a new challenge for bitcoin .

As said many times by others, current solutions just kick the can down the road and a proper solution for propagation in the network remains to be found and implemented (imho the relay network should be considered as a temporary "patch" (no offense intended to its creator) and shouldn't become a replacement of the p2p network).

Understanding the economic consequences of future solutions is really needed before we decide to go down the road and not so much has been done until now. So, keep up the good work !

i agree with this view.  the relay network is cutting corners and making risky shortcuts in relaying w/o essentially verifying.  it only recently added a node in Beijing within the GFC.  i wonder though if it's origins were a means of compensating for the top 5 largest miners being in China?

again, one of my reasons for wanting to increase blocksize is to increase competition in mining outside of China to those who have greater bandwidth.  this would help level the playing field.

[thezerg]

If my understanding of IBLT is correct, its main advantage is that the quantity of information transmitted on the wire is constant, whatever the number of transactions inside the block.

IMHO, it's fair to say that propagation of these data is not the whole story. There's a reconciliation to be done between the new block and the local mempool but I think it's also fair to make the hypothesis that with such a mechanism in place, mining pools may have an incentive to keep an exhaustive mempool (in order to avoid the burden of requesting missing transactions and to increase their performances/profits).

...

Right, the reconciliation process will take time (information must be communicated), and the amount of time will have a lower limit proportional to the Shannon Entropy in the new block.  One could argue that the Shannon Entropy in a new block will not in general be proportional to the size of the block, but that doesn't make any sense to me.  In fact, the only way I can imagine that it would be possible is if the block solutions contain no information about the included transactions at all (i.e., the case of infinite coding gain).  But if there's no information communicated about the transactions included in a block, then in my opinion the miners aren't peers but slaves and the system is already centralized.  

If the network is composed of peers who build blocks based on their own volition, then I argue that information (Shannon Entropy) about the transactions contained within the new blocks must be communicated as part of the block solution.  If this is the case, the fee market will remain healthy (according to the definition of a healthy fee market given in feemarket.pdf).

Basing the argument on information theory is problematic because there are 2 phases to the communication (txn exchange and block solution broadcast) and we are just focused on the second phase.  Observations like communication must be proportional to # txns apply to the whole communication not its parts.

[Peter R]

Basing the argument on information theory is problematic because there are 2 phases to the communication (txn exchange and block solution broadcast) and we are just focused on the second phase.  Observations like communication must be proportional to # txns apply to the whole communication not its parts.

The fact that there are two phases in the communication is what allows the block solution to be compressed by a factor of γ (the coding gain).  The model takes this into account.

[iCEBREAKER]

Gold up.  Cypherdoc collapsing.

I LOL'd.  Sad to see Frap.doc is not immune to the contagious stupidity of Reddit, and has been reduced to posting cute doggy pics in place of his formerly astute analysis and insight.

It's almost as if Team Gavin had something on him and is forcing this daft, nonsensical, out-of-character recent misbehavior.   

[tvbcof]

...
again, one of my reasons for wanting to increase blocksize is to increase competition in mining outside of China to those who have greater bandwidth.  this would help level the playing field.

'Again', eh?  I'd never heard you make that argument before though you are a veritable fountain of desperate nonesense.

But ya, we like totally have to keep them slanty-eyed chinks from horning in on our distributed crypto-currency.

As Gavin says, people are obviously going to trust their own government more than others to manage things in the best interests of their countrymen.  And you never know what those commies would do if they got control.

[solex]

As said many times by others, current solutions just kick the can down the road and a proper solution for propagation in the network remains to be found and implemented

Unfortunately, "kicking the can" is a common pejorative term which can be thrown like mud at any interim solution.
It is perfectly valid to implement medium-term engineering changes in steps which are not an ideal end-solution, but may be built upon to get there, or replaced entirely when the "ideal" solution is found and achievable. This is particularly true in order to maintain a known current state (i.e. the headroom for growth state which has persisted since Jan 2009) which will undergo an unpredictable state change within 12 months due to inaction.



or a single MB

[cypherdoc]

i'll be spending more time here:  https://www.reddit.com/r/bitcoin_uncensored/

[cypherdoc]

Bitcoin will like this:

http://www.bloomberg.com/news/articles/2015-08-11/china-weakens-yuan-reference-rate-by-record-1-9-amid-slowdown

[brg444]

i'll be spending more time here:  https://www.reddit.com/r/bitcoin_uncensored/

 

I refuse to believe you are actually an adult person.

[solex]

i'll be spending more time here:  https://www.reddit.com/r/bitcoin_uncensored/

Great! Thanks for the link.
Subscribed.

[Mengerian]

Peter_R:

Great paper! The last paragraph got me thinking though, and I think I have come up with another way of visualizing the system that could generalize the result to the case where block reward is zero.

Mempool Demand Curve:

I think it simplifies things if block reward and transaction fees are treated as the same thing, where the block reward is simply treated as a transaction with a large fee (ie, coinbase transaction would be a very tall skinny triangle). The block reward can then be included in the mempool demand curve, causing it to pretty much start at R instead of 0.

Block Space Supply Curve:

Again, when considering the revenue per block, I will combine the reward and fees (R and M) and call it M_rev. The profit equation then becomes:

Profit = M_rev (h/H) e^(-τ/T) - ηhT
(Sorry for the rudimentary looking equation, I'm not sure how to enter it properly here)

In your paper, you base the supply curve on the "neutral profit". The problem with this is that the analysis breaks down when the block reward is zero. Instead of assuming a profitable empty block, I will simply solve for the total revenue (reward plus fees) needed to yield a profit. So, to get the block space supply curve, simply set the profit to 0 and solve for M_rev, yielding:

M_rev = ηHT e^(τ/T)

Similar to your formulations, this curve will curve upward as block size increases, but will intersect the y axis at ηHT. So for a miner to profit by mining an empty block, the block reward must be greater than ηHT.

Plotting the Supply and demand curve together looks like this:
(I have normalized both curves to a single miner’s point of view by multiplying by h/H)

https://i.imgur.com/mxgW7UE.jpg

And the miner’s profit is the distance of the revenue curve above the cost curve.

The nice thing about plotting it this way is that we can also consider what would happen if transaction fees become a significant source of revenue and the block reward is not sufficient to profitably mine empty blocks:

https://i.imgur.com/Cd1Anik.jpg

We can see that in this case, it would only make sense for the miners to include enough transactions to be in the region of the graph where revenue exceeds cost. This would also work in the extreme case where R=0.

[iCEBREAKER]

or a single MB

Good insight solex.  Bitcoin's ongoing (yet still potential) Great Schism does appear to cleave along Taoist/Buddhist cypherpunk vs Confucian corporatist lines.

Betting (and especially fighting) against the Chuang-Tzu acolytes of Crypto-Shaolin is highly contraindicated...

Our Supreme Abbot is worth twelve hundred thousand inferior imperial functionaries (whether they hail from DC, London, or Beijing).  And as Hearn enrages the young blood, XT will be (subtly) massacred....

[Zarathustra]

Using logic, I can see two possible reason for being a block minimalist developer.

1)  Since "Uh oh, here it is we who decide the size of the blocks", because having power is good. Since there is no consensus within the self appointed dominator group, we have to wait until the royals can come to agreement.

2) They want to suffocate bitcoin, permanently if possible, to get a head start on their endevour into competing systems.

Yes:

The iCEman: "more debate prolongs the stalemate"

https://bitcointalk.org/index.php?topic=68655.msg12067133#msg12067133

[NewLiberty]

Using logic, I can see two possible reason for being a block minimalist developer.

1)  Since "Uh oh, here it is we who decide the size of the blocks", because having power is good. Since there is no consensus within the self appointed dominator group, we have to wait until the royals can come to agreement.

2) They want to suffocate bitcoin, permanently if possible, to get a head start on their endevour into competing systems.

Or the opposite of #1.  As a developer, having power is very bad.  
The goal of the project is to avoid centralization of power, and at least some are working on achieving that goal for themselves by divesting of it while it remains possible to do so.  (BIP100)

This improvement proposal is the only significant one so far that removes the dev team from picking arbitrary numbers and dates and puts the size to the market of miners.

There are some other proposals on miners paying to a forward pool to increase the block size, but they are not so formalized yet.