Pages:
Author

Topic: Bitcoin & Tragedy of the Commons - page 3. (Read 21902 times)

legendary
Activity: 1246
Merit: 1016
Strength in numbers
March 15, 2012, 07:41:48 AM
Of course it won't happen like this in reality, there will be a constant equilibrium where the increase of miners in low fee pools results in the decrease of profits for everyone which basically results in low fee miners moving back to high fee pools because that's the only way they can keep mining profitably.


They can sell their power to someone who realizes it will make more coin by working together.
legendary
Activity: 1246
Merit: 1016
Strength in numbers
March 15, 2012, 07:36:43 AM
@meni

It's true a tiny miner will simply migrate to a pool that takes all fees. However, in the all tiny miner  situation where no one has pricing power the tiny miner doesn't mine at all. But he has cheap/free electric, nice GPUs etc. So he offers to sell it to some smart guy. Smart guy realizes that buying the power of 4000 tiny miners will give him pricing power and profit. It happens to start raising the level of fees across the board making it harder or more expensive for him to buy more miners power because they can better profit on their own now.
legendary
Activity: 2184
Merit: 1056
Affordable Physical Bitcoins - Denarium.com
March 15, 2012, 07:29:49 AM
I know about the tragedy of the commons but let's just say that I've always been very skeptical about it, it really does not apply well to most real life scenarios. I understand what you're saying and maybe I'm the one who is clueless here but I'll try my best now to make sense of all of this.

I don't believe that high fee miners will defect to low fee pools simply because it appears that they would get more by going there. In fact they get significantly less because by doing that users don't have incentive to pay high fees anymore.

To think about this in another way is to imagine that all miners will defect to the low fee pools. What happens then? Mining becomes unprofitable and some miners will again attempt to raise fee thresholds.

Of course it won't happen like this in reality, there will be a constant equilibrium where the increase of miners in low fee pools results in the decrease of profits for everyone which basically results in low fee miners moving back to high fee pools because that's the only way they can keep mining profitably.

So in conclusion I still think that what I'm talking about could work and fairly well actually. But I don't mind if you prove me wrong.

legendary
Activity: 1246
Merit: 1016
Strength in numbers
March 15, 2012, 07:20:13 AM
A miner can try to demand high fees, but if 99% of miners accept low fees, nobody will be willing to pay these high fees.


No, that's my whole point. Anyone who wants >99% chance of being in the next block will pay higher fees. Especially if the fee is like .01 on a 100BTC tx.

Even needing to rely on this pricing power phenomenon seems unlikely to me and it's just there as back up.

Already we're paying miners fees so that non-mining nodes will take us seriously enough to pass the tx on.

There are many other things like this that can happen. Maybe some subset of people will be appalled to receive a tx that didn't have a fee. Uncertainty about who these people are may lead to a .0001 (don't hate me for being a freeloading jerk) standard.

Maybe a lot of miners won't keep a complete chain and will be unable to easily verify small or old inputs. You'll need a fee if you don't want to wait for the one generous soul who keeps the whole thing and charges no fees.
donator
Activity: 2058
Merit: 1054
March 15, 2012, 07:01:25 AM
What happens is that major mining businesses who don't want to just quit, start raising their fee thresholds. This eventually creates a situation where you might only have 10% of total hashing power in pool z and everyone else has moved on to either the high fee pools or the medium fee pools.It's true that pool z gets the fees for everything but they only find 1/10 of the blocks. All users that appreciate speedy transactions will pay more than the minimum and 90% of those blocks do not benefit pool z in any way.
Who has moved on? Miners?

You're confused about how mining and mining pools work. If a pool has N miners (suppose for simplicity all pooled miners have the same hashrate), then it finds on average N*a/D blocks per day, where D is the difficulty and a is a global constant. If the average reward per block is B, the average total reward per day is B*N*a/D, which is distributed among N miners, so each gets B*a/D on average. The only thing that changes between pools is B (based on their inclusion policy), so miners will always go to the pool with a higher B (which is the pool that includes all transactions). The fact that this pool is "only 10% of the total hashing power" has no effect on this.

A smaller pool will have more variance, but since the all-inclusive pool pays the best, there's no reason it should be small.

The end result is that pools which only include high-fee transactions will not be competitive, and 100% of the pooled mining hashrate will be in low-fee pools.

And the point remains that although all pools would be better off if all pools accept only high-fee transactions, no pool would initiate a move to higher threshold (without being part of a cartel) because it will decrease its own profitability. Which, once again, is called "tragedy of the commons", or "prisoner's dilemma" in the 2-player case.

I find it perfectly possible that all of the different pool classes can be profitable, except perhaps the one that only accepts minimum transactions. I'd imagine that at this stage a very large majority of users want to pay more than the minimum to make sure their transaction is at least in the next couple of blocks. Pool z gets a small share of that action.
It gets a share of that action proportional to its hashrate, like any pool. And in addition it gets a share of the low-fee action.

Not less profitable, more profitable. Imagine if 80% of hashing power simply decided that they've had enough of these free transactions. Their mining hardware costs money, it requires work and they want some profit. Traditional block rewards are a fraction of what they were back in the day. They want to keep mining and supporting the network but it's simply unprofitable.

Now imagine that 80% changing their fee threshold from 0.001 to 0.01, effectively increasing the fees by 10. Now users have a choice, they can either send transactions with a 0.001 fee and wait on average for 50 minutes to be included in a block. Or they can add a 0.01 fee, which is still quite cheap, and make sure that their transaction is in the next block.
Yes, if 80% of hashrate forms a cartel and make an explicit agreement to play hardball, they will increase their profit. But even after the cartel is formed, members of the cartel are better off if personally they defect from the cartel and start accepting all transactions (unless the cartel enforces it somehow), as well as non-cartel members who will still accept all transactions. The cartel would have to crush competition by rejecting all blocks who do not conform to the cartel. And that is not a scenario I wish to happen.

It's easy to think that everyone would just mine at the pool that accepts all transactions, because their blocks have the biggest rewards. Fact is that it just doesn't work like that. If everyone did that, we would be back to square one where mining is unprofitable. This is why there will be a sort of profitability index or "difficulty" for each pool, not just mining in general. If too many miners go to a low fee pool, suddenly users are not paying high fees anymore because there is sufficient hashing power in the low fee pools. Thus the profitability of all mining goes down. This is not in the interest of miners so it simply won't happen.
Now I'm sure you haven't read Prisoner's dilemma and Tragedy of the commons (the former is clearer, it refers to a 2-player case but the logic is the same). Every miner will act in his own self interest, not in the interest of other miners. Whatever other miners do, the most profitable thing to do is to defect (which in this case means accepting all transactions).

Everyone will do that, and as you correctly state, we will be back to square one where mining is unprofitable. (And it's not necessary that everyone will do that, it's enough that someone will do that).

This can be resolved if we change the rules so that the global interest is aligned with everyone's self interest. But this requires a coordinated effort, it doesn't happen spontaneously.
legendary
Activity: 2184
Merit: 1056
Affordable Physical Bitcoins - Denarium.com
March 15, 2012, 07:01:18 AM
to become even less profitable?

bad behavior is incentivized, good behavior is not. that's why it is hard to imagine it could work (similar to communism).
Not less profitable, more profitable. Imagine if 80% of hashing power simply decided that they've had enough of these free transactions. Their mining hardware costs money, it requires work and they want some profit. Traditional block rewards are a fraction of what they were back in the day. They want to keep mining and supporting the network but it's simply unprofitable.

As an attempt to make mining profitable again, the 80% change their fee threshold from 0.001 to 0.01, effectively increasing the fees by a factor of 10. Now users have a choice, they can either send transactions with a 0.001 fee and wait on average for 50 minutes to be included in a block. Or they can add a 0.01 fee, which is still quite cheap, and make sure that their transaction is in the next block.

What do you guys think users will choose? I believe a lot of people would choose paying 0.01 which would basically increase the overall profitability of mining by a lot. It would increase even for the ones who stay mining 0.001 transactions. Everyone would benefit, except the users of course, but they must understand that mining doesn't run on free hardware and free energy.
legendary
Activity: 1708
Merit: 1020
March 15, 2012, 06:52:45 AM
Pool z will include all transactions with a fee above 0.001, which includes all transactions included by pool y, which in turn includes all transactions included by pool x. The total block reward in a block find by pool z will be higher than in pool x. The expected payout for mining at pool z is higher than in pool x. Nobody will mine at pool x.
[...]
What happens is that major mining businesses who don't want to just quit, start raising their fee thresholds.
[...]
to become even less profitable?

bad behavior is incentivized, good behavior is not. that's why it is hard to imagine it could work (similar to communism).

there might be a solution to get it right simpler than proof of stake by changing the fee mechanisms.

Examples (just brainstorming):
* limit the tx fee spread within a block   (factor 10: 0.1 highest --> 0.01 lowest fee alowed)
   spread could be hard coded or voted on by the miners
* have the miners vote on future minimum fees / spread by destroying coins
legendary
Activity: 2184
Merit: 1056
Affordable Physical Bitcoins - Denarium.com
March 15, 2012, 06:52:43 AM
It's easy to think that everyone would just mine at the pool that accepts all transactions, because their blocks have the biggest rewards. Fact is that it just doesn't work like that. If everyone did that, we would be back to square one where mining is unprofitable. This is why there will be a sort of profitability index or "difficulty" for each pool, not just mining in general. If too many miners go to a low fee pool, suddenly users are not paying high fees anymore because there is sufficient hashing power in the low fee pools. Thus the profitability of all mining goes down. This is not in the interest of miners so it simply won't happen.
legendary
Activity: 2184
Merit: 1056
Affordable Physical Bitcoins - Denarium.com
March 15, 2012, 06:31:19 AM
I would like to add that it's difficult for a cartel/monopoly to happen. Bitcoin mining might get a little more centralized than it is now but it will still be very distributed. Even if someone controlled 20% of hashing power, he simply could not force anything on users. He can demand high fees but if users are not willing to pay, then he gets pretty much nothing. Users would have slightly slower transactions but by not paying the fees they would force the 20% player to lower his fee threshold because he is asking too high of a price. This is text book stuff btw.

So basically if the miners start to get rich, Bitcoin userbase has ultimate power to stop that. They only need to stop paying high fees for a while and the pools that demand higher fees are forced to correct their prices. Especially with Bitcoin price probably still being fairly volatile at that stage, it's important for users to stay awake. If Bitcoin price doubles and the pools still demand similar fees, then something is wrong.
legendary
Activity: 2184
Merit: 1056
Affordable Physical Bitcoins - Denarium.com
March 15, 2012, 06:22:03 AM
Pool z will include all transactions with a fee above 0.001, which includes all transactions included by pool y, which in turn includes all transactions included by pool x. The total block reward in a block find by pool z will be higher than in pool x. The expected payout for mining at pool z is higher than in pool x. Nobody will mine at pool x.
It's not that simple. The calculations for this gets a little complex at this point but first it's important to understand that a scenario where there is only pool z is already discarded.

Everyone mining at pool z, which basically represents the way mining works now, is not profitable anymore because traditional block rewards have all but disappeared. This is the scenario which we start with and start to work on. I have to add that it would of course always be profitable to a certain amount of people, difficulty would adjust. But a network based only on the actual cost of sending and verifying transactions is out of the question, Bitcoin will require more than that.

What happens is that major mining businesses who don't want to just quit, start raising their fee thresholds. This eventually creates a situation where you might only have 10% of total hashing power in pool z and everyone else has moved on to either the high fee pools or the medium fee pools. It's true that pool z gets the fees for everything but they only find 1/10 of the blocks. All users that appreciate speedy transactions will pay more than the minimum and 90% of those blocks do not benefit pool z in any way.

I find it perfectly possible that all of the different pool classes can be profitable, except perhaps the one that only accepts minimum transactions. I'd imagine that at this stage a very large majority of users want to pay more than the minimum to make sure their transaction is at least in the next couple of blocks. Pool z gets a small share of that action.

There would of course be constant changes in the hash power of different fee classes. Miners would change based on what users are paying and users would change what they're willing to pay for certain speed. I feel this really could work and it would create a very interesting market overall.

Quote
Once again - including transactions is cheap. You can include all of them (that is, those with fee higher than the tiny cost) and increase your profits. Everybody will do that, unless he is big enough to individually (or as part of a cartel) have a real bargaining power, which itself would be a problem.
Including transactions is cheap, that is true. What is also true is that in the future miners have more bargaining power than they do now. Mining pools will start raising their fee thresholds at some point, I see this as pretty much inevitable. It makes a lot sense and I hope Bitcoin devs are aware of this. It's not a priority issue right now but eventually we will be in a situation where the fees must be higher to sustain a mining network that secures Bitcoin. The best way to do it is enabling a market between miners and users, similarly to what I've been explaining.
legendary
Activity: 2184
Merit: 1056
Affordable Physical Bitcoins - Denarium.com
March 15, 2012, 06:01:19 AM
this is hard to imagine working as most of the time it will be more profitable for pool x to also include all the low fees.
Care to explain this further? The miners who decide to accept only high fee transactions have incentive to not include any low fee transactions. If they did, users wouldn't have any incentive to pay for higher fees. For higher fees to work, a significant amount of hashing power need to set a higher fee threshold. If they just accept whatever, then users have no incentive to ever pay more than the minimum. This is the way it is now but I can guarantee it won't be like this forever.

Quote
I can see mining guilds forming that ddos pools accepting low fees.
This is a valid point but it's not that big of a problem. I imagine p2pool type solutions will become more common in the years to come and they are very ddos resistant.
donator
Activity: 2058
Merit: 1054
March 15, 2012, 05:34:36 AM
In addition to only accepting transactions with a certain fee, miners might not even attempt to mine a block at all until it has enough in fees to be profitable.
Unless something else can be done with the hardware, it's quite possible miners will keep mining to avoid thermal cycles. Whether this will happen is TBD.

1) Plenty of people have reasons to get their transaction fully confirmed ASAP. For example, MtGox users. So, users will include a large transaction fee in hopes of convincing more miners to turn on to mine the block.
Tragedy of the commons, the contribution of a sender to confirmation time is everyone's, the cost of the included transaction fee is all his own. ie, the personal effect on paying a fee for the confirmation of your own transaction is negligible.

They'd then likely send fee-only transactions in the next 5 blocks to make sure that the mining keeps up.
Even more tragedy of the commons, since they don't even get any preferential treatment for fees paid this way. But it would be interesting to find an incentivization scheme which does incentivezes the miners of the next blocks.

4) Businesses will contract out to certain miners to ensure that low priority transactions (such as low-value POS transactions where the person also provided their ID) get included in a semi-timely manner for a monthly rate (businesses love stability). MtGox already does this.
Explanation required.

7) Miners will have invested a good deal of money in specialized hardware to mine bitcoins. As a result, any attack that could potentially undermine Bitcoin would likely be met with the FULL force of ALL specialized mining hardware which will have been programmed by their owners to reverse the attack in order to protect their investment. As an added plus, we gain a huge security through obscurity benefit here since it'd be impossible for an attacker to predict how much mining power the whole network actually has until they've tried attacking it.
See also this thread.
legendary
Activity: 1764
Merit: 1002
March 15, 2012, 05:27:21 AM
I think you guys totally underestimate the desire of the marketplace to disintermediate the banks:

 http://www.telegraph.co.uk/finance/economics/9143581/Technology-could-take-the-bankers-out-of-banking-says-BoE-policmaker-Andy-Haldane.html
donator
Activity: 2058
Merit: 1054
March 15, 2012, 05:19:48 AM
Block space is limited, as is the computing power to validate the signatures in the transactions.  Right at the moment neither of these is really scarce, as understood by laymen, but they aren't unlimited either.
Block size currently has an arbitrary limit of 1MB. It is generally understood that when there are too many transactions it will be lifted or relaxed, so actually there is no real limit. (If a sufficiently tight permanent limit is set, we will not have this problem. But this of course could hurt scalability). The cost of validating signatures is negligible.


To put it simply what will happen is this:

We will have a large number of pools and most likely many different p2pools as well. I will pull some numbers out of my ass to illustrate this, in reality the market will decide these numbers.

Pool x has a fee threshold of 0.1, meaning that they only accept transactions that have at least 0.1 bitcoins as a fee. This is the "high speed, high prices, low volumes" pool.

Pool y has a fee threshold of 0.05, which is "if you want decent speed but don't want to pay a premium" type pool.

Pool z has a fee threshold of 0.001, this is the "cheaper than the competitors, but slow as fuck" type pool.
Pool z will include all transactions with a fee above 0.001, which includes all transactions included by pool y, which in turn includes all transactions included by pool x. The total block reward in a block found by pool z will be higher than in pool x. The expected payout for mining at pool z is higher than in pool x. Nobody will mine at pool x.

Once again - including transactions is cheap. You can include all of them (that is, those with fee higher than the tiny cost) and increase your profits. Everybody will do that, unless he is big enough to individually (or as part of a cartel) have a real bargaining power, which itself would be a problem.
legendary
Activity: 1708
Merit: 1020
March 15, 2012, 04:48:03 AM
[...]'nother dimension[...]
+1, good post

really hope it will work like this

edit: this will cause quite some thermal stress for the mining hardware


[...]I will pull some numbers out of my ass to illustrate this[...]
Cheesy

Quote
[...]
Pool x has a fee threshold of 0.1, meaning that they only accept transactions that have at least 0.1 bitcoins as a fee. This is the "high speed, high prices, low volumes" pool.

Pool y has a fee threshold of 0.05, which is "if you want decent speed but don't want to pay a premium" type pool.

Pool z has a fee threshold of 0.001, this is the "cheaper than the competitors, but slow as fuck" type pool.
[...]

this is hard to imagine working as most of the time it will be more profitable for pool x to also include all the low fees.


I can see mining guilds forming that ddos pools accepting low fees.


legendary
Activity: 1050
Merit: 1003
March 15, 2012, 01:38:29 AM

Altogether, this will come together in such way that Bitcoin will remain secure and block times will be fairly stable. There are so many variables in play here that it's really quite brilliant. At this point, the only thing I would be concerned about is a 51% miner that rejects everyone else's blocks. Any other attack, economic or not, will fail miserably.

This is a completely ridiculous argument. Are you braindead or just fucking with us?

Let me paraphrase you:

Sally and Harry might be convinced to mine some.
That proves that people can be convinced.
Therefore, it will be possible to convince enough people to mine.
legendary
Activity: 1204
Merit: 1015
March 14, 2012, 06:39:19 PM
There is a whole 'nother dimension to this that you guys are ignoring, and that's time. In addition to only accepting transactions with a certain fee, miners might not even attempt to mine a block at all until it has enough in fees to be profitable. Alone, this may be bad. However, there are several interesting dynamics to consider, even if you assume miners are completely logical:

1) Plenty of people have reasons to get their transaction fully confirmed ASAP. For example, MtGox users. So, users will include a large transaction fee in hopes of convincing more miners to turn on to mine the block. They'd then likely send fee-only transactions in the next 5 blocks to make sure that the mining keeps up.
2) Many people will need to do this several times per day, however they won't know when they'd be able to "freeride" off of someone else until the transaction is on the network. Besides, if you need something to clear right now, you didn't plan ahead in the first place, and it's impossible to guess if someone else might shortly cover the cost of running a large amount of miners for you.
3) Different miners have different profitability points. Even if someone else already paid to have several miners running, there are always several more miners that can run if you pay just a bit more in fees. Currently, all active miners are mining at 100% anyway, so this is an effect that you can't yet see.
4) Businesses will contract out to certain miners to ensure that low priority transactions (such as low-value POS transactions where the person also provided their ID) get included in a semi-timely manner for a monthly rate (businesses love stability). MtGox already does this.
5) A certain amount of people will mine no matter what, likely including every transaction they safely can (remember, the larger a block is, the longer it takes to validate, the more likely it is that someone else will find another block that orphans yours).
6) After a miner successfully mines a (particularly profitable) block, they will either mine at full power for a few blocks to protect their block, send fee-only transactions using stored up funds that will hopefully be reimbursed out of their profits from the block to entice other miners to mine the block (this is where a protocol change would be nice so that this can actually come directly out of the mined funds or at least be dependent on them), or likely a combination of both. This will help smooth block times a bit.
7) Miners will have invested a good deal of money in specialized hardware to mine bitcoins. As a result, any attack that could potentially undermine Bitcoin would likely be met with the FULL force of ALL specialized mining hardware which will have been programmed by their owners to reverse the attack in order to protect their investment. As an added plus, we gain a huge security through obscurity benefit here since it'd be impossible for an attacker to predict how much mining power the whole network actually has until they've tried attacking it.

Altogether, this will come together in such way that Bitcoin will remain secure and block times will be fairly stable. There are so many variables in play here that it's really quite brilliant. At this point, the only thing I would be concerned about is a 51% miner that rejects everyone else's blocks. Any other attack, economic or not, will fail miserably.
legendary
Activity: 2184
Merit: 1056
Affordable Physical Bitcoins - Denarium.com
March 14, 2012, 05:44:37 PM
Block space is limited, as is the computing power to validate the signatures in the transactions.  Right at the moment neither of these is really scarce, as understood by laymen, but they aren't unlimited either.
This is a good point. That is a real issue that actually requires some effort from Bitcoin developers in the next couple of years. Bitcoin still has some room to grow, a lot of room actually, but it doesn't scale very well after a certain point. This is one of the bigger priorities but I'm not too worried about that. Bitcoin has very smart people working on it and it seems that the majority of Bitcoin use will move toward client-server wallets which buys us a good amount of time to come up with real solutions.

Another important issue is how do we actually make the shift to the transaction fee market scenario that I'm talking about. It would probably go smoother if Bitcoin developers co-ordinate with all the big pool operators so it is a smooth experience to Bitcoin users. It will take time for Bitcoin users to get used to the fact that transactions will cost something and that the speed of their transactions will depend on how much they pay. From an UI and usability perspective this needs to be clear and easy to understand. The clients also need to be constantly up-to-date on how long it takes on average for a transaction to be included in a block at a certain fee.

However that issue is probably even less of a priority than the scaling issue. It will still take many years until there is real pressure to raise transaction fees. Even a block reward of 25 BTC is still quite adequate to not worry about this. Scaling could become a real issue before we have to worry about miners' rewards.
kjj
legendary
Activity: 1302
Merit: 1026
March 14, 2012, 05:32:41 PM
There is an aspect of this which is textbook tragedy of the commons, but it's kind of abstract. The scarce public good being consumed is the bargaining power of miners. As long as miners have that power, they can demand enough fees to fund the mining required to secure the network. If a miner accepts low-fee transactions, he consumes this bargaining power (since then senders will have no reason to include fees) for his own benefit, making everyone worse off (miners who are now unable to collect fees, and Bitcoin users who will now not have a secure network).
I don't think you quite grasp the way markets work. What you're describing makes no sense to me. The mining network will form a near-perfect market environment where some will have a business based on volume and some will base their business on higher prices and faster transactions. Miners won't just quit in the same way as they do now, if the fee they are accepting suddenly becomes unprofitable, they can simply change their fees to find a more optimal level. A more optimal level could just as well be higher, not necessarily lower.
A miner can try to demand high fees, but if 99% of miners accept low fees, nobody will be willing to pay these high fees.

You are forgetting that (unless limitations are placed), space for transactions is an abundant resource. It does not work like a market where participants manufacture a scarce product. The only thing to lose by including a transaction is bargaining power - which is everyone's, not just the individual miners.

If the mining community is too crowded compared to Bitcoin transaction counts (and to an extent price and difficulty as well, just like now), then some will quit mining and thus difficulty goes down meaning more blocks and thus more reward for everyone else (not as block rewards, but as transaction fees).
That's exactly the problem, miners will quit and the network will be less secure.

Block space is limited, as is the computing power to validate the signatures in the transactions.  Right at the moment neither of these is really scarce, as understood by laymen, but they aren't unlimited either.
legendary
Activity: 2184
Merit: 1056
Affordable Physical Bitcoins - Denarium.com
March 14, 2012, 05:25:22 PM
A miner can try to demand high fees, but if 99% of miners accept low fees, nobody will be willing to pay these high fees.

You are forgetting that (unless limitations are placed), space for transactions is an abundant resource. It does not work like a market where participants manufacture a scarce product. The only thing to lose by including a transaction is bargaining power - which is everyone's, not just the individual miners.
You must understand that this will in fact work just like any market, fundamentally. If 99% of miners accept low fees and get enough profit by doing that, then everything is completely fine. But I don't see this happening once Bitcoin starts the shift to transaction fee rewards. What happens is that when miner or mining pool x starts to get unprofitable, they will not just quit, they will raise the fee threshold first. Most likely there are other miners in this 99% that feel the same way and they also raise their fee threshold.

Now what happens from the user's perspective is that suddenly 50% (just thrown out there) of the mining network doesn't accept low fee transactions anymore, because it's not profitable! Users suddenly need to choose either to pay more to get their transactions through in 10 minutes average or continue to pay low fees and get them through in 20 minutes average. I bet that a good portion of users will agree to pay slightly more to get faster transactions.

This is where everything changes. We don't have this scenario yet because regular block reward is all that counts. Bitcoin price and difficulty is all that matters. In the future the main thing that matters is the amount of transactions and how much users are willing to pay for faster transactions.
Pages:
Jump to: