I don't think you can use the argument that the number of computers capable of running a full node will be declining, because if it ever does, it won't be any time soon.
This is false; the number is already
shockingly low. It can only get lower with an increase in the cost of maintaining a node.
I said nothing about the number of full bitcoin nodes being up or down. I said the number of PCs capable of running full nodes is increasing and will not be decreasing any time soon. Maybe one day it will, but this decade is not it, and I seriously doubt the next decade is, either.[/quote]
Satoshi also envisioned ASICs dominating the network and being run in a more centralized manner, but many people forget that as well. Centralization is not necessarily a bad thing, depending on the circumstances and if that centralization can be counterbalanced with the ability to quickly and decisively eliminate the negative forces of centralization, then I think that outweighs the risks.
This is false as welli. Sure, many things benefit from centralizationii, but the money supply is not one of them. And then you go on to say something that doesn't make sense.. What is the "counterbalance" to "quickly and decisively eliminate the negative forces of centralization?" You say this but fail to explain it. I see the risk in centralizing the full nodes; I don't see any benefit to it, especially when the same effect can be achieved via off-chain solutions that do not compromise the security of the network as a whole.
It is not false. Centralization can be good, especially in say e.g. mining. If mining pools did not exist and it was purely a peer-to-peer operation and a hard or even a soft fork happened that required immediate tending to, it would be virtually impossible to get enough clients to change in a fast enough time frame to save bitcoin. You'd have a massive hard fork and lots of angry people and a complete loss of confidence in bitcoin. This applies to the current state of bitcoin - that may change in the future, who knows, but it's true as of now. That being the case, since there are pools if a hard fork happens due to a protocol problem, a bug, some as yet unknown attack, etc... it will be (comparatively) trivial to get the top 5 or 6 major pools to change to a new bitcoin core node and all start mining the same chain, instead of a huge mess of tens of thousands of clients needing to change simultaneously to start mining the proper chain.
I'm not saying centralization is great, or even good. But it is the lesser of two evils in some instances and if it's a choice between a somewhat centralized bitcoin and no bitcoin at all, I'd say centralization falls on the side of good.
As for the counterbalance, one example is lined above. Having a centralized structure housed in 4 or 5 or even 15 top pools means if there's an attack or threat, the blockchain can evolve rapidly. The counterbalance I'm talking about is that if some pools go rogue, they can be shut out of the network fairly easily. Now, you can make the counter argument that it's easier to subvert X number of pools and take them rogue vs subverting X number of decentralized clients and taking them rogue and you'd be correct. We've seen with the massive botnets that it's possible to harness the power of a vast number of machines, and with bitcoin in it's current state, it is not out of the realm of possibility for even private individuals with moderately substantial means to subvert enough end clients to subvert the bitcoin network if one were sufficiently motivated and the network were completely decentralized. Neither is a perfect solution, but what I do know is that limiting the transaction volume to a paltry 1 MB is going to not only hurt bitcoin, but completely kill it as far as global, massive uptake goes.
Off chain solutions are a brain dead solution to a problem that doesn't exist. The problem is how to fix bitcoin and make it scalable... not how to make new software to accomplish the same task but in a different way. There are probably many uses and reasons to explore off chain and side chain scenarios, but none of them are even remotely close to the solution for the problem being discussed here.
i :
Bitcoin: A Peer-to-Peer Electronic Cash SystemThe proof-of-work also solves the problem of determining representation in majority decision
making. If the majority were based on one-IP-address-one-vote, it could be subverted by anyone
able to allocate many IPs. Proof-of-work is essentially one-CPU-one-vote.
So by extension, we can say that you believe anyone able to allocate many CPUs should be allowed to subvert the blockchain? I don't get what you're getting at here.
ii :
In which we discuss Datskovskiy's discussion of MPExJust so is the case with Bitcoins and markets : it makes perfect sense for the currency itself to be decentralized. It makes absolutely no sense at all for the marketplace to be decentralized. In fact, a decentralized market is about as much a market as a deenginized car is a car. The market is precisely where economic agents come together, that's what it does, it centralizes trade. Further, it is sensible for the currency itself to be as trustless as possible, and thus mechanisms that implement trustlessness are a net gain in that field. A market can never exist at all without trust, and so mechanisms that purportedly implement "trustlessness" are nothing but clunk in this field.
I'm sorry, maybe I don't understand where you're coming from, but why are you quoting Mircea Popescu? I admit I have not read this entire thread, so maybe there's a reason... but I don't see what value there is to quoting an insane, misogynistic, racist drug addict here? The guy has shown time and again that he has no idea what he's talking about and everything he has ever done in his life is complete garbage (just going by what I've read of and from him, so I could be incorrect). His quotes are like quoting "1, 2, 3, potato!" for all the value it brings.
