Bitcoin XT - Officially #REKT (also goes for BIP101 fraud) - page 196.

knight22

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Activity: 1372

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Quote from: brg444 on September 07, 2015, 04:33:16 PM

Quote from: knight22 on September 07, 2015, 04:31:01 PM

Quote from: jonald_fyookball on September 07, 2015, 04:15:55 PM

Quote from: brg444 on September 07, 2015, 04:07:59 PM

More blocksize essentially means more opportunity to capture transaction fees. This necessarily leads to an incentive to create bigger and bigger blocks therefore considerably increasing the cost of running a full node.

Yes but...

1. non mining nodes are already doing this altruistically.

Not necessarily. Payment processors have an interest to run a full node to more efficiently broadcast their transactions to the network.

You'd be surprised by the amount of wallet services provider that don't actually run a full node.

Do you have anything that can supports that claim or is it just an assumption?

jonald_fyookball

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Activity: 1302

Merit: 1008

Core dev leaves me neg feedback #abuse #political

Quote from: brg444 on September 07, 2015, 04:22:41 PM

Quote from: jonald_fyookball on September 07, 2015, 04:15:55 PM

Quote from: brg444 on September 07, 2015, 04:07:59 PM

More blocksize essentially means more opportunity to capture transaction fees. This necessarily leads to an incentive to create bigger and bigger blocks therefore considerably increasing the cost of running a full node.

Yes but...

1. non mining nodes are already doing this altruistically.

Less so than ever before and increasing costs will not help.

2. Technology is getting better and cheaper all the time.

Technology would not keep up under a scenario without a blocksize cap. Moreover security systems can not be built on assumptions of technological progress.

3. As adoption widens, there may be more nodes coming on board, even if that hasn't happened in the last 2 years

Increased costs makes this unlikely. The number does not necessarily matter, it is the barriers to entry that do

4. The more you move things offchain, the more you introduce centralized elements.

The importance is to leave a choice: "Bitcoin is a trustworthy court enforcing contracts between parties. It's possible to take every contract to the judge, but it is rather inefficient." -gmaxwell The simple fact that Bitcoin holds the truth and can rule over and sometimes enforce contrats between user and third-party necessarily diminishes attempt for the third party to fraud.

I'm all for choice. Nothing against third partys running offchain payment solutions. However, forcing it via cap = less choice.

brg444

hero member

Activity: 644

Merit: 504

Bitcoin replaces central, not commercial, banks

Quote from: knight22 on September 07, 2015, 04:31:01 PM

Quote from: jonald_fyookball on September 07, 2015, 04:15:55 PM

Quote from: brg444 on September 07, 2015, 04:07:59 PM

More blocksize essentially means more opportunity to capture transaction fees. This necessarily leads to an incentive to create bigger and bigger blocks therefore considerably increasing the cost of running a full node.

Yes but...

1. non mining nodes are already doing this altruistically.

Not necessarily. Payment processors have an interest to run a full node to more efficiently broadcast their transactions to the network.

You'd be surprised by the amount of wallet services provider that don't actually run a full node.

Also, I have no interest in a network where only payment processors run nodes.

brg444

hero member

Activity: 644

Merit: 504

Bitcoin replaces central, not commercial, banks

Quote from: knight22 on September 07, 2015, 04:28:35 PM

Quote from: brg444 on September 07, 2015, 04:25:44 PM

Quote from: knight22 on September 07, 2015, 04:17:14 PM

Quote from: brg444 on September 07, 2015, 04:05:24 PM

How do you judge when the system becomes too centralised, particularely when it comes to nodes?

You guys have been suggesting the market is interested is in a global payment network/currency unrestricted by a transaction bottleneck. A more centralized network offers exactly that.

Are you not worried that miners can slowly capture the participants up until a point where they control a great majority of the network nodes and can trivially change protocol rules? At which point users might be presented with a choice to stay at the behest of miners and assume that they will act in everyone's interest or fork the coin and risk severely undermining the trust in cryptocurrencies in general (causing important financial losses).

I guess nearing 50% hashrate centralization is enough for the market to start panicking as shown by the Ghash episode and another similar episode with another pool which I can't recall ATM.

We all know the advantages decentralized system have over centralised one. And no, I don't think a centralized miner will be able to fool everyone as long as the system remains open. The blockchain is too heavily monitored for this to happen.

See here:

Quote from: laurentmt on September 07, 2015, 04:07:26 PM

What really matters to miners is a market thinking that mining is decentralized, not a really decentralized mining ecosystem.
It's important to remember that most (all ?) available statistics describing the (de)centralization of mining rely on weak (and easy to cheat) heuristics.

Also you have again conveniently ignored my point that hashrate centralization is not the only centralization concern.

Well remove hashrate and my point still remain the same.

Your point doesn't really hold unless you predicted the SPV mining centralization that occured recently and caused a fork of the network.

The miners action are far from transparent.

knight22

legendary

Activity: 1372

Merit: 1000

--------------->¿?

Quote from: jonald_fyookball on September 07, 2015, 04:15:55 PM

Quote from: brg444 on September 07, 2015, 04:07:59 PM

More blocksize essentially means more opportunity to capture transaction fees. This necessarily leads to an incentive to create bigger and bigger blocks therefore considerably increasing the cost of running a full node.

Yes but...

1. non mining nodes are already doing this altruistically.

Not necessarily. Payment processors have an interest to run a full node to more efficiently broadcast their transactions to the network.

knight22

legendary

Activity: 1372

Merit: 1000

--------------->¿?

Quote from: brg444 on September 07, 2015, 04:25:44 PM

Quote from: knight22 on September 07, 2015, 04:17:14 PM

Quote from: brg444 on September 07, 2015, 04:05:24 PM

How do you judge when the system becomes too centralised, particularely when it comes to nodes?

You guys have been suggesting the market is interested is in a global payment network/currency unrestricted by a transaction bottleneck. A more centralized network offers exactly that.

Are you not worried that miners can slowly capture the participants up until a point where they control a great majority of the network nodes and can trivially change protocol rules? At which point users might be presented with a choice to stay at the behest of miners and assume that they will act in everyone's interest or fork the coin and risk severely undermining the trust in cryptocurrencies in general (causing important financial losses).

I guess nearing 50% hashrate centralization is enough for the market to start panicking as shown by the Ghash episode and another similar episode with another pool which I can't recall ATM.

We all know the advantages decentralized system have over centralised one. And no, I don't think a centralized miner will be able to fool everyone as long as the system remains open. The blockchain is too heavily monitored for this to happen.

See here:

Quote from: laurentmt on September 07, 2015, 04:07:26 PM

What really matters to miners is a market thinking that mining is decentralized, not a really decentralized mining ecosystem.
It's important to remember that most (all ?) available statistics describing the (de)centralization of mining rely on weak (and easy to cheat) heuristics.

Also you have again conveniently ignored my point that hashrate centralization is not the only centralization concern.

Well remove hashrate and my point still remain the same.

brg444

hero member

Activity: 644

Merit: 504

Bitcoin replaces central, not commercial, banks

Quote from: knight22 on September 07, 2015, 04:17:14 PM

Quote from: brg444 on September 07, 2015, 04:05:24 PM

How do you judge when the system becomes too centralised, particularely when it comes to nodes?

You guys have been suggesting the market is interested is in a global payment network/currency unrestricted by a transaction bottleneck. A more centralized network offers exactly that.

Are you not worried that miners can slowly capture the participants up until a point where they control a great majority of the network nodes and can trivially change protocol rules? At which point users might be presented with a choice to stay at the behest of miners and assume that they will act in everyone's interest or fork the coin and risk severely undermining the trust in cryptocurrencies in general (causing important financial losses).

I guess nearing 50% hashrate centralization is enough for the market to start panicking as shown by the Ghash episode and another similar episode with another pool which I can't recall ATM.

We all know the advantages decentralized system have over centralised one. And no, I don't think a centralized miner will be able to fool everyone as long as the system remains open. The blockchain is too heavily monitored for this to happen.

See here:

Quote from: laurentmt on September 07, 2015, 04:07:26 PM

What really matters to miners is a market thinking that mining is decentralized, not a really decentralized mining ecosystem.
It's important to remember that most (all ?) available statistics describing the (de)centralization of mining rely on weak (and easy to cheat) heuristics.

Also you have again conveniently ignored my point that hashrate centralization is not the only centralization concern.

brg444

hero member

Activity: 644

Merit: 504

Bitcoin replaces central, not commercial, banks

Quote from: jonald_fyookball on September 07, 2015, 04:15:55 PM

Quote from: brg444 on September 07, 2015, 04:07:59 PM

More blocksize essentially means more opportunity to capture transaction fees. This necessarily leads to an incentive to create bigger and bigger blocks therefore considerably increasing the cost of running a full node.

Yes but...

1. non mining nodes are already doing this altruistically.

Less so than ever before and increasing costs will not help.

2. Technology is getting better and cheaper all the time.

Technology would not keep up under a scenario without a blocksize cap. Moreover security systems can not be built on assumptions of technological progress.

3. As adoption widens, there may be more nodes coming on board, even if that hasn't happened in the last 2 years

Increased costs makes this unlikely. The number does not necessarily matter, it is the barriers to entry that do

4. The more you move things offchain, the more you introduce centralized elements.

The importance is to leave a choice: "Bitcoin is a trustworthy court enforcing contracts between parties. It's possible to take every contract to the judge, but it is rather inefficient." -gmaxwell The simple fact that Bitcoin holds the truth and can rule over and sometimes enforce contrats between user and third-party necessarily diminishes attempt for the third party to fraud.

hdbuck

legendary

Activity: 1260

Merit: 1002

Quote from: brg444 on September 07, 2015, 04:14:46 PM

Quote from: hdbuck on September 07, 2015, 04:09:42 PM

Quote from: brg444 on September 07, 2015, 03:47:52 PM

Quote from: ?? on ??

Quote from: brg444 on September 07, 2015, 03:27:16 PM

Quote from: Peter R on September 07, 2015, 03:19:03 PM

Quote from: laurentmt on September 07, 2015, 03:03:39 PM

Quote from: Peter R on September 07, 2015, 02:09:09 PM

Will mining centralize around one single miner? No one knows. This is why Bitcoin is still a risk.
But if this doesn't happen--if there remains more than a single miner--then the fee market does exist.

I think the point of contention is really about this conclusion.

My understanding is that it may also happen with several miners if they have an incentive to synchronize their mempools (with a mechanism like IBLT).

Do you agree that this conclusion applies to the way the network is now and the way it has always been?

I ask, just because I want it to be clear to readers that this "point of contention" is about a hypothetical future scenario. And that we already know that there are hypothetical future scenarios, such as mining centralized around a single super pool, that would be bad for Bitcoin.

It absolutely doesnt. Miners already optimize for profit by centralizing in various ways. The recent SPV mining near-catastrophe is an excellent example.

Your conclusions hold under no existing and future scenario. It makes assumptions that are untenable and require absolute altruism from miners.

The crux of the issue is that miners incentives are not aligned with the network's users. The max block size cap mitigates the fact that they are expected (for security reasons) to prioritize financial profit over network decentralization. Yes, there might be no other way to align these incentives than by forcing it through consensus code.

hey! i disagree!! Grin

in my view miners are nothing if it was not for the users they validate the transactions for: users do the speculation, users gives bitcoin its value, which then makes it profitable to mine (and not any other altcoin) .

remember what happened btc price wise when ghash.io almost had 50% of the network? massive sell out.. Roll Eyes

hence, miners do have an incentive to keep on mining the longest VALID chain, which, by definition means the one that has the more value potential.
so they better not screwing around with some power grabbing fork, else they loose everything...

this is bitcoin's consensus.

I agree with most of what you said but I don't believe it really addresses my point.

The GHash situation is very different as it was very public. The SPV mining fiasco is a better example of a situation users were not readily aware of yet causes considerable risk to the ecosystem. The miners do have incentives to maintain the users trust but they have a certain flexibility and ability to optimize for profit in a "bend but don't break" manner. Anyway, Peter Todd always makes a good point that we should not build this system based on "best-behaviour" assumptions but rather expect any potential attack.

The centralization I refer to relates to geographical and technical optimization that give larger miners a slight advantage over smaller ones that slowly but surely dries out the smaller miners revenue.

It is not something that is immediately apparent to most users and the extent to which such centralization can occur is difficult to examine.

That is not to suggest they are expect to fork off or create immediate damage but it is a slippery & dark road that can slowly lead to a level of centralization that enables considerable throughput hence the centralization pressure externalized to the network nodes.

ah yea well, do not underestimate the weight of real bitcoiners (as in early libertarian paranoid adopters with most bitcoins) that would seriously damage btc value by a click the minute they sense a security hole that some soft centralization would ultimately imply.

+ i think that besides the noobs over here and reddit, most of us know why we are here, and would retaliate (or even abandon ship, or stick to a more "core version") the second we feel our investment's security would be put at risk by the greedy corporations/banks/gov/ph0undation/etc.

Yes that all goes without saying.

The exercise here is really in pointing out to the noobs the risks and holes behind their "demands".

Sometimes I do wonder why it is I spend so much time doing it Grin

I guess it also helps me to model and sharpen my understanding of Bitcoin as a whole....

eheh, im done tho, half the forum is on ignore now.. Grin

knight22

legendary

Activity: 1372

Merit: 1000

--------------->¿?

Quote from: brg444 on September 07, 2015, 04:05:24 PM

Quote from: knight22 on September 07, 2015, 03:57:25 PM

Quote from: brg444 on September 07, 2015, 03:47:52 PM

Quote from: ?? on ??

Quote from: brg444 on September 07, 2015, 03:27:16 PM

Quote from: Peter R on September 07, 2015, 03:19:03 PM

Quote from: laurentmt on September 07, 2015, 03:03:39 PM

Quote from: Peter R on September 07, 2015, 02:09:09 PM

Will mining centralize around one single miner? No one knows. This is why Bitcoin is still a risk.
But if this doesn't happen--if there remains more than a single miner--then the fee market does exist.

I think the point of contention is really about this conclusion.

My understanding is that it may also happen with several miners if they have an incentive to synchronize their mempools (with a mechanism like IBLT).

Do you agree that this conclusion applies to the way the network is now and the way it has always been?

I ask, just because I want it to be clear to readers that this "point of contention" is about a hypothetical future scenario. And that we already know that there are hypothetical future scenarios, such as mining centralized around a single super pool, that would be bad for Bitcoin.

It absolutely doesnt. Miners already optimize for profit by centralizing in various ways. The recent SPV mining near-catastrophe is an excellent example.

Your conclusions hold under no existing and future scenario. It makes assumptions that are untenable and require absolute altruism from miners.

The crux of the issue is that miners incentives are not aligned with the network's users. The max block size cap mitigates the fact that they are expected (for security reasons) to prioritize financial profit over network decentralization. Yes, there might be no other way to align these incentives than by forcing it through consensus code.

hey! i disagree!! Grin

in my view miners are nothing if it was not for the users they validate the transactions for: users do the speculation, users gives bitcoin its value, which then makes it profitable to mine (and not any other altcoin) .

remember what happened btc price wise when ghash.io almost had 50% of the network? massive sell out.. Roll Eyes

hence, miners do have an incentive to keep on mining the longest VALID chain, which, by definition means the one that has the more value potential.
so they better not screwing around with some power grabbing fork, else they loose everything...

this is bitcoin's consensus.

I agree with most of what you said but I don't believe it really addresses my point.

The GHash situation is very different as it was very public.

The centralization I refer to relates to geographical and technical optimization that give larger miners a slight advantage over smaller ones that slowly but surely dries out the smaller miners revenue.

It is not something that is immediately apparent to most users and the extent to which such centralization can occur is difficult to examine.

That is not to suggest they are expect to fork off or create immediate damage but it is a slippery & dark road that can slowly lead to a level of centralization that enables considerable throughput hence the centralization pressure externalized to the network nodes.

I don't think it is such a dark path as long as the market has the hability to fork if the system becomes too centralised. If that happen the market will reacted because they is no incentives for them to use such a system.

How do you judge when the system becomes too centralised, particularely when it comes to nodes?

You guys have been suggesting the market is interested is in a global payment network/currency unrestricted by a transaction bottleneck. A more centralized network offers exactly that.

Are you not worried that miners can slowly capture the participants up until a point where they control a great majority of the network nodes and can trivially change protocol rules? At which point users might be presented with a choice to stay at the behest of miners and assume that they will act in everyone's interest or fork the coin and risk severely undermining the trust in cryptocurrencies in general (causing important financial losses).

I guess nearing 50% hashrate centralization is enough for the market to start panicking as shown by the Ghash episode and another similar episode with another pool which I can't recall ATM.

We all know the advantages decentralized system have over centralised one. And no, I don't think a centralized miner will be able to fool everyone as long as the system remains open. The blockchain is too heavily monitored for this to happen.

jonald_fyookball

legendary

Activity: 1302

Merit: 1008

Core dev leaves me neg feedback #abuse #political

Quote from: brg444 on September 07, 2015, 04:07:59 PM

More blocksize essentially means more opportunity to capture transaction fees. This necessarily leads to an incentive to create bigger and bigger blocks therefore considerably increasing the cost of running a full node.

Yes but...

1. non mining nodes are already doing this altruistically.
2. Technology is getting better and cheaper all the time.
3. As adoption widens, there may be more nodes coming on board, even if that hasn't happened in the last 2 years
4. The more you move things offchain, the more you introduce centralized elements.

So, you may have some arguments against bigger blocks, but I'm not like, you know, super convinced. Cheesy

brg444

hero member

Activity: 644

Merit: 504

Bitcoin replaces central, not commercial, banks

Quote from: hdbuck on September 07, 2015, 04:09:42 PM

Quote from: brg444 on September 07, 2015, 03:47:52 PM

Quote from: ?? on ??

Quote from: brg444 on September 07, 2015, 03:27:16 PM

Quote from: Peter R on September 07, 2015, 03:19:03 PM

Quote from: laurentmt on September 07, 2015, 03:03:39 PM

Quote from: Peter R on September 07, 2015, 02:09:09 PM

Will mining centralize around one single miner? No one knows. This is why Bitcoin is still a risk.
But if this doesn't happen--if there remains more than a single miner--then the fee market does exist.

I think the point of contention is really about this conclusion.

My understanding is that it may also happen with several miners if they have an incentive to synchronize their mempools (with a mechanism like IBLT).

Do you agree that this conclusion applies to the way the network is now and the way it has always been?

I ask, just because I want it to be clear to readers that this "point of contention" is about a hypothetical future scenario. And that we already know that there are hypothetical future scenarios, such as mining centralized around a single super pool, that would be bad for Bitcoin.

It absolutely doesnt. Miners already optimize for profit by centralizing in various ways. The recent SPV mining near-catastrophe is an excellent example.

Your conclusions hold under no existing and future scenario. It makes assumptions that are untenable and require absolute altruism from miners.

The crux of the issue is that miners incentives are not aligned with the network's users. The max block size cap mitigates the fact that they are expected (for security reasons) to prioritize financial profit over network decentralization. Yes, there might be no other way to align these incentives than by forcing it through consensus code.

hey! i disagree!! Grin

in my view miners are nothing if it was not for the users they validate the transactions for: users do the speculation, users gives bitcoin its value, which then makes it profitable to mine (and not any other altcoin) .

remember what happened btc price wise when ghash.io almost had 50% of the network? massive sell out.. Roll Eyes

hence, miners do have an incentive to keep on mining the longest VALID chain, which, by definition means the one that has the more value potential.
so they better not screwing around with some power grabbing fork, else they loose everything...

this is bitcoin's consensus.

I agree with most of what you said but I don't believe it really addresses my point.

The GHash situation is very different as it was very public. The SPV mining fiasco is a better example of a situation users were not readily aware of yet causes considerable risk to the ecosystem. The miners do have incentives to maintain the users trust but they have a certain flexibility and ability to optimize for profit in a "bend but don't break" manner. Anyway, Peter Todd always makes a good point that we should not build this system based on "best-behaviour" assumptions but rather expect any potential attack.

The centralization I refer to relates to geographical and technical optimization that give larger miners a slight advantage over smaller ones that slowly but surely dries out the smaller miners revenue.

It is not something that is immediately apparent to most users and the extent to which such centralization can occur is difficult to examine.

That is not to suggest they are expect to fork off or create immediate damage but it is a slippery & dark road that can slowly lead to a level of centralization that enables considerable throughput hence the centralization pressure externalized to the network nodes.

ah yea well, do not underestimate the weight of real bitcoiners (as in early libertarian paranoid adopters with most bitcoins) that would seriously damage btc value by a click the minute they sense a security hole that some soft centralization would ultimately imply.

+ i think that besides the noobs over here and reddit, most of us know why we are here, and would retaliate (or even abandon ship, or stick to a more "core version") the second we feel our investment's security would be put at risk by the greedy corporations/banks/gov/ph0undation/etc.

Yes that all goes without saying.

The exercise here is really in pointing out to the noobs the risks and holes behind their "demands".

Sometimes I do wonder why it is I spend so much time doing it Grin

I guess it also helps me to model and sharpen my understanding of Bitcoin as a whole....

hdbuck

legendary

Activity: 1260

Merit: 1002

Quote from: brg444 on September 07, 2015, 03:47:52 PM

Quote from: ?? on ??

Quote from: brg444 on September 07, 2015, 03:27:16 PM

Quote from: Peter R on September 07, 2015, 03:19:03 PM

Quote from: laurentmt on September 07, 2015, 03:03:39 PM

Quote from: Peter R on September 07, 2015, 02:09:09 PM

Will mining centralize around one single miner? No one knows. This is why Bitcoin is still a risk.
But if this doesn't happen--if there remains more than a single miner--then the fee market does exist.

I think the point of contention is really about this conclusion.

My understanding is that it may also happen with several miners if they have an incentive to synchronize their mempools (with a mechanism like IBLT).

Do you agree that this conclusion applies to the way the network is now and the way it has always been?

I ask, just because I want it to be clear to readers that this "point of contention" is about a hypothetical future scenario. And that we already know that there are hypothetical future scenarios, such as mining centralized around a single super pool, that would be bad for Bitcoin.

It absolutely doesnt. Miners already optimize for profit by centralizing in various ways. The recent SPV mining near-catastrophe is an excellent example.

Your conclusions hold under no existing and future scenario. It makes assumptions that are untenable and require absolute altruism from miners.

The crux of the issue is that miners incentives are not aligned with the network's users. The max block size cap mitigates the fact that they are expected (for security reasons) to prioritize financial profit over network decentralization. Yes, there might be no other way to align these incentives than by forcing it through consensus code.

hey! i disagree!! Grin

in my view miners are nothing if it was not for the users they validate the transactions for: users do the speculation, users gives bitcoin its value, which then makes it profitable to mine (and not any other altcoin) .

remember what happened btc price wise when ghash.io almost had 50% of the network? massive sell out.. Roll Eyes

hence, miners do have an incentive to keep on mining the longest VALID chain, which, by definition means the one that has the more value potential.
so they better not screwing around with some power grabbing fork, else they loose everything...

this is bitcoin's consensus.

I agree with most of what you said but I don't believe it really addresses my point.

The GHash situation is very different as it was very public. The SPV mining fiasco is a better example of a situation users were not readily aware of yet causes considerable risk to the ecosystem. The miners do have incentives to maintain the users trust but they have a certain flexibility and ability to optimize for profit in a "bend but don't break" manner. Anyway, Peter Todd always makes a good point that we should not build this system based on "best-behaviour" assumptions but rather expect any potential attack.

The centralization I refer to relates to geographical and technical optimization that give larger miners a slight advantage over smaller ones that slowly but surely dries out the smaller miners revenue.

It is not something that is immediately apparent to most users and the extent to which such centralization can occur is difficult to examine.

That is not to suggest they are expect to fork off or create immediate damage but it is a slippery & dark road that can slowly lead to a level of centralization that enables considerable throughput hence the centralization pressure externalized to the network nodes.

ah yea well, do not underestimate the weight of real bitcoiners (as in early libertarian paranoid tech savy adopters with most bitcoins) that would seriously damage btc value by a click the minute they sense a security hole that some soft centralization would ultimately imply.

+ i think that besides the noobs over here and reddit, most of us know why we are here, and would retaliate (or even abandon ship, or stick to a more "core version") the second we feel our investment's security would be put at risk by the greedy corporations/banks/gov/ph0undation/etc.

brg444

hero member

Activity: 644

Merit: 504

Bitcoin replaces central, not commercial, banks

Quote from: laurentmt on September 07, 2015, 04:07:26 PM

Quote from: ?? on ??

hence, miners do have an incentive to keep it decentralized whilst mining the longest VALID chain, which, by definition means the one that has the more value potential.
so they better not screwing around with some power grabbing fork, else they loose everything...

A short parenthesis about the miners and the market.
What really matters to miners is a market thinking that mining is decentralized, not a really decentralized mining ecosystem.
It's important to remember that most (all ?) available statistics describing the (de)centralization of mining rely on weak (and easy to cheat) heuristics.
End of the parenthesis Wink

Thank you, very important point!

brg444

hero member

Activity: 644

Merit: 504

Bitcoin replaces central, not commercial, banks

Quote from: jonald_fyookball on September 07, 2015, 04:02:21 PM

Quote from: brg444 on September 07, 2015, 04:00:28 PM

Quote from: jonald_fyookball on September 07, 2015, 03:51:39 PM

Quote from: brg444 on September 07, 2015, 03:27:16 PM

The crux of the issue is that miners incentives are not aligned with the network's users.

Both parties need a secure network. If miners raise fees enough (raising fees is in their interests already) to get to a baseline level of security, would users walk away? I don't think they would.
Do miners really need to be coerced into charging an adequate fee by a block limit? I don't think they do.

Miners need to be coerced into limiting the load exercised on nodes who are not rewarded for their work.

Remember that our objective is not only to optimize the miners' revenue model but to do so while recognizing the impact this has on the security model of the network.

I really don't understand what you're saying. What do the non mining modes have to do with this?

Well of course they have to keep up with the appetite of the miners. Miners are perfectly happy to sell more block space since they don't pay for it (they pay for the hashing power). More blocksize essentially means more opportunity to capture transaction fees. This necessarily leads to an incentive to create bigger and bigger blocks therefore considerably increasing the cost of running a full node.

laurentmt

sr. member

Activity: 384

Merit: 258

Quote from: ?? on ??

hence, miners do have an incentive to keep it decentralized whilst mining the longest VALID chain, which, by definition means the one that has the more value potential.
so they better not screwing around with some power grabbing fork, else they loose everything...

A short parenthesis about the miners and the market.
What really matters to miners is a market thinking that mining is decentralized, not a really decentralized mining ecosystem.
It's important to remember that most (all ?) available statistics describing the (de)centralization of mining rely on weak (and easy to cheat) heuristics.
End of the parenthesis Wink

brg444

hero member

Activity: 644

Merit: 504

Bitcoin replaces central, not commercial, banks

Quote from: knight22 on September 07, 2015, 03:57:25 PM

Quote from: brg444 on September 07, 2015, 03:47:52 PM

Quote from: ?? on ??

Quote from: brg444 on September 07, 2015, 03:27:16 PM

Quote from: Peter R on September 07, 2015, 03:19:03 PM

Quote from: laurentmt on September 07, 2015, 03:03:39 PM

Quote from: Peter R on September 07, 2015, 02:09:09 PM

Will mining centralize around one single miner? No one knows. This is why Bitcoin is still a risk.
But if this doesn't happen--if there remains more than a single miner--then the fee market does exist.

I think the point of contention is really about this conclusion.

My understanding is that it may also happen with several miners if they have an incentive to synchronize their mempools (with a mechanism like IBLT).

Do you agree that this conclusion applies to the way the network is now and the way it has always been?

I ask, just because I want it to be clear to readers that this "point of contention" is about a hypothetical future scenario. And that we already know that there are hypothetical future scenarios, such as mining centralized around a single super pool, that would be bad for Bitcoin.

It absolutely doesnt. Miners already optimize for profit by centralizing in various ways. The recent SPV mining near-catastrophe is an excellent example.

Your conclusions hold under no existing and future scenario. It makes assumptions that are untenable and require absolute altruism from miners.

The crux of the issue is that miners incentives are not aligned with the network's users. The max block size cap mitigates the fact that they are expected (for security reasons) to prioritize financial profit over network decentralization. Yes, there might be no other way to align these incentives than by forcing it through consensus code.

hey! i disagree!! Grin

in my view miners are nothing if it was not for the users they validate the transactions for: users do the speculation, users gives bitcoin its value, which then makes it profitable to mine (and not any other altcoin) .

remember what happened btc price wise when ghash.io almost had 50% of the network? massive sell out.. Roll Eyes

hence, miners do have an incentive to keep on mining the longest VALID chain, which, by definition means the one that has the more value potential.
so they better not screwing around with some power grabbing fork, else they loose everything...

this is bitcoin's consensus.

I agree with most of what you said but I don't believe it really addresses my point.

The GHash situation is very different as it was very public.

The centralization I refer to relates to geographical and technical optimization that give larger miners a slight advantage over smaller ones that slowly but surely dries out the smaller miners revenue.

It is not something that is immediately apparent to most users and the extent to which such centralization can occur is difficult to examine.

That is not to suggest they are expect to fork off or create immediate damage but it is a slippery & dark road that can slowly lead to a level of centralization that enables considerable throughput hence the centralization pressure externalized to the network nodes.

I don't think it is such a dark path as long as the market has the hability to fork if the system becomes too centralised. If that happen the market will reacted because they is no incentives for them to use such a system.

How do you judge when the system becomes too centralised, particularely when it comes to nodes?

You guys have been suggesting the market is interested is in a global payment network/currency unrestricted by a transaction bottleneck. A more centralized network offers exactly that.

Are you not worried that miners can slowly capture the participants up until a point where they control a great majority of the network nodes and can trivially change protocol rules? At which point users might be presented with a choice to stay at the behest of miners and assume that they will act in everyone's interest or fork the coin and risk severely undermining the trust in cryptocurrencies in general (causing important financial losses).

jonald_fyookball

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Activity: 1302

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Core dev leaves me neg feedback #abuse #political

Quote from: brg444 on September 07, 2015, 04:00:28 PM

Quote from: jonald_fyookball on September 07, 2015, 03:51:39 PM

Quote from: brg444 on September 07, 2015, 03:27:16 PM

The crux of the issue is that miners incentives are not aligned with the network's users.

Both parties need a secure network. If miners raise fees enough (raising fees is in their interests already) to get to a baseline level of security, would users walk away? I don't think they would.
Do miners really need to be coerced into charging an adequate fee by a block limit? I don't think they do.

Miners need to be coerced into limiting the load exercised on nodes who are not rewarded for their work.

Remember that our objective is not only to optimize the miners' revenue model but to do so while recognizing the impact this has on the security model of the network.

I really don't understand what you're saying. What do the non mining modes have to do with this?

brg444

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Bitcoin replaces central, not commercial, banks

Quote from: jonald_fyookball on September 07, 2015, 03:51:39 PM

Quote from: brg444 on September 07, 2015, 03:27:16 PM

The crux of the issue is that miners incentives are not aligned with the network's users.

Both parties need a secure network. If miners raise fees enough (raising fees is in their interests already) to get to a baseline level of security, would users walk away? I don't think they would.
Do miners really need to be coerced into charging an adequate fee by a block limit? I don't think they do.

Miners need to be coerced into limiting the load exercised on nodes who are not rewarded for their work.

Remember that our objective is not only to optimize the miners' revenue model but to do so while recognizing the impact this has on the security model of the network.

knight22

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Activity: 1372

Merit: 1000

--------------->¿?

Quote from: brg444 on September 07, 2015, 03:47:52 PM

Quote from: ?? on ??

Quote from: brg444 on September 07, 2015, 03:27:16 PM

Quote from: Peter R on September 07, 2015, 03:19:03 PM

Quote from: laurentmt on September 07, 2015, 03:03:39 PM

Quote from: Peter R on September 07, 2015, 02:09:09 PM

Will mining centralize around one single miner? No one knows. This is why Bitcoin is still a risk.
But if this doesn't happen--if there remains more than a single miner--then the fee market does exist.

I think the point of contention is really about this conclusion.

My understanding is that it may also happen with several miners if they have an incentive to synchronize their mempools (with a mechanism like IBLT).

Do you agree that this conclusion applies to the way the network is now and the way it has always been?

I ask, just because I want it to be clear to readers that this "point of contention" is about a hypothetical future scenario. And that we already know that there are hypothetical future scenarios, such as mining centralized around a single super pool, that would be bad for Bitcoin.

It absolutely doesnt. Miners already optimize for profit by centralizing in various ways. The recent SPV mining near-catastrophe is an excellent example.

Your conclusions hold under no existing and future scenario. It makes assumptions that are untenable and require absolute altruism from miners.

The crux of the issue is that miners incentives are not aligned with the network's users. The max block size cap mitigates the fact that they are expected (for security reasons) to prioritize financial profit over network decentralization. Yes, there might be no other way to align these incentives than by forcing it through consensus code.

hey! i disagree!! Grin

in my view miners are nothing if it was not for the users they validate the transactions for: users do the speculation, users gives bitcoin its value, which then makes it profitable to mine (and not any other altcoin) .

remember what happened btc price wise when ghash.io almost had 50% of the network? massive sell out.. Roll Eyes

hence, miners do have an incentive to keep on mining the longest VALID chain, which, by definition means the one that has the more value potential.
so they better not screwing around with some power grabbing fork, else they loose everything...

this is bitcoin's consensus.

I agree with most of what you said but I don't believe it really addresses my point.

The GHash situation is very different as it was very public.

The centralization I refer to relates to geographical and technical optimization that give larger miners a slight advantage over smaller ones that slowly but surely dries out the smaller miners revenue.

It is not something that is immediately apparent to most users and the extent to which such centralization can occur is difficult to examine.

That is not to suggest they are expect to fork off or create immediate damage but it is a slippery & dark road that can slowly lead to a level of centralization that enables considerable throughput hence the centralization pressure externalized to the network nodes.

I don't think it is such a dark path as long as the market has the hability to fork if the system becomes too centralised. If that happen the market will reacted because they is no incentives for them to use such a system.

Topic: Bitcoin XT - Officially #REKT (also goes for BIP101 fraud) - page 196. (Read 378996 times)