Topic: Block-size debate solution (Read 1791 times)

Incremental increases in block-size will work to avoid the sighash verification attack so long as the blocks fill up not too long after each increase.
(So bumping blocksize up to 2mb or so now should be fine, then again larger later when 2mb blocks are reliably full with TX fee paying transactions.)

Why?
The sighash verification attacker forsakes the TX fees in order to get the coinbase miner subsidy.
Larger full blocks are the swiftest and surest way to move to a TX-fee supported network.
When this occurs, the incentive for this variety of attack goes away and blocksize is no longer limited by this attack vector.

How?
Simple increases (as Satoshi suggested back in 2010), manually introduced as needed, will work just fine.
The main criticism of this is that it is central-banker like activity, however as shown, the need for this manual activity disappears in a finite amount of time in the relatively near future (when bitcoin becomes a fee-supported network).

lets say as example ψ has start a coffee shop and he hire an employee waiter to serve the customers,after two months it is observed that the customers have increased * 10 and the waiter can not cope with the demands the customers because they have increased considerably, customers are angry because the have not yet received their order after, ψ notice that a customer gives a high tip to waiter in order to get their order faster and some customers leave dissatisfied

Now put where employee = 1mb where customers = bitcoin users where order = confirmation where high tip = high fee and read it again

so ψ need to increase their employeeys in order to serve their customers fast without waiting and and high tips,if ψ don't increase their employee he will lost their customers +++ simple maths, in my humble opinion bitcoin cant scale with 1mb, sorry for my enlgish I hope you understand what i mean

I don't think that would happen on the 100 tx/s chain I was talking about. A average transaction amount of $20 is already indicating it's not being used for extremely small micro-transactions or senseless zero-amount transactions - because the fee for these extreme use cases would be too high.

I think that due to competition for space, a chain of this capacity with the usage level I put as an example will have fees that are very similar to Bitcoin's today or even a little bit higher, because for a $10, $20 or $30 transaction 0.10$ or even 0.20$ in fees is still acceptable, but for $1, it is not.


That would only be true if we scale today from 3 tx/s to 100 tx/s in one giant step and not in a gradual manner - as Satoshi says in the sentence you quoted, "when it's needed" (actually, I think our standpoints are not so far away one from another). The example of a 100 tx/chain with 20$ average transaction amount is obviously settled in the distant future when there is already a Bitcoin mass adoption.

But unfortunately I think that in the present we're already needing a block size increase if we really target mass adoption. I estimate we're presently needing roughly 1,5 to 2x the actual blockchain space for a flawless Bitcoin experience for the coming months without bottlenecks - keep in mind that in 2015 and 2016, transaction volume increased approximately by 30% and we can expect the same for 2017.

So Segwit alone is enough for now, but in 2018-2019 there would be another increase needed. And for the future, as I already said, I am in favour of a continuous block size increase of 10-20% per year - that's even less the expected volume increase but with off-chain solutions it should be enough.



I see that value for a blockchain that has the same utility like Bitcoin today (or better: in 2016, because actually we are having bottlenecks that scare away new users) and can be easily used for $10-20 transactions. But in the near future this "threshold" will rise to $30, then to $50 and $100 without block size increase. Already in 2018, if nothing happens, for many presently viable use cases Bitcoin will be too expensive.

Extreme cases like the one you pointed out with a $1000 average transaction amount would limit participation to wealthy individuals and companies and relegate the rest of the people to sidechains and offchain solutions, which are of lower quality and a more centralized nature.

I think in this case, an alternative chain with higher capacity would take away users from Bitcoin - and Bitcoin's value would eventually decrease or even crash hard because there would be virtually no "backing" for its price and speculation against its price would be easy.

It's intentionally simple to illustrate the point.


You have to remember that high capacity (and consequent low fees) bring with them uses that are not necessarily economic in nature. For example, using the bitcoin blockchain as a distributed storage file, for storing all kind of irrelevant things - in a sense we are talking about txs with 0$ transfer of value. If someone wants to use the blockchain to store gigabytes per day in bullshit, paying peanuts, they can. And you can't stop them.


Yes it can, but with decentralization cost and users relying on third parties.

Plus real usage is not even 1/10th of that, which means 9+/10ths of the blockchain would be occupied with crap. Why would anyone impose 700gb of crap on everyone else? It's insane.


By its users and its properties to be able to move around non-trivial amounts of money with very small fees.

The benefit of bitcoin widens the larger the amount of money being transferred is. If you want to transfer 10cents and have to pay 20 cents fee, that's not effective. If you want to transfer 100$ or 10k$ and have to pay 20 cents fee (saving you 3$ or 300$ from, say, a paypal) that's far better.

This is not something theoretical btw. You go over at apmex, for example: http://www.apmex.com/product/102251/2017-1-oz-gold-american-eagle-bu?toppicks1

And see:

Quantity   Check/Wire   CC/PayPal

1 - 9            $1,310.69   $1,365.30

+55$ for doing the exact same purchase through CC/Paypal...


I think the use cases are determined based on a profitability equation. Our threshold might be around 5-10$ right now, meaning that if you want to transact more than that, it's probably more profitable going through BTC, than through other electronic payment means. If paypal requires users to pay, say, 3-4% in fees + 0.35$, then a 10$ transfer would cost around 0.65-0.75$.

Are there use cases for moving around more than 5-10$ and saving money in the process, while also enjoying the benefit of knowing that no one will freeze your account, demonetize your currency, reverse your txs, etc etc? The answer is a qualified yes.



Keep in mind that in the same discussion, the previous message of satoshi, says:


...which indicates he wanted blocksize increases on a need-to basis. Which is what I'd expect from a rational man who has glimpsed the problem of giving away too much space for abuse and seeks a solution. The automated proposal of his next message cannot evaluate needs. Humans can (subjectively). And that's where friction comes in.

That math is too simple, sorry.

Network 1 would be a pure microtransactions network. In this case 100tx/sec would be too few for a global currency (It could be a regional cryptocurrency, but then it would not be a competitor to Network 2).

100tx/sec (a block size of ~15 MB assuming a 250 byte average 1-address-to-1-address-transaction) would be more suitable for a mid-size-transactions-network, let's say with an average transaction amount of $20. That would be 172 mn usd per day in transaction volume - that would be a more realistic competitor to the 1000-per-transaction chain (let's call it Network 1b).

The question is now: would the costs to maintain network 1b prohibitively higher than that of network 2? If yes, then Network 2 could have a competitive advantage. Network 1b would mean a ~788GB/year blockchain. Even today that can be handled by consumer-level storage hardware - and more so in the near future. Professional hardware has no problems with it. And modern Bitcoin clients allow pruning. The problem would be bandwidth - but many Big Blockers are Chinese and apparently do not fear big blocks despite having more limited bandwidth because of the Great Firewall.


And how did the value from Network 2 come from? That's the question. A small-block network will have few use cases (as outlined in the link I brought in above), much less users and therefore is more vulnerable to speculation attacks because its "intrinsic value" (=usability / network effect) is much more limited and its liquidity is much lower.

PS: Despite of all this I'm a Segwit and LN supporter and I don't want 15 MB blocks now, 2 MB with a 10-20% yearly increase (like Satoshi's idea) would be fine. But I want LN as a microtransactions network and not as the standard way to transact with BTC.

Network 1: Tx capacity 100tx/sec, does 1$ per tx = 8.6mn usd per day in trade volume
Network 2: Tx capacity 5tx/sec, does 1000$ per tx = 432mn usd per day in trade volume

Just the fee savings that Network 2 can have, compared to, say, Paypal or Western Union fees, exceed Network 1 entire trade volume.

Obviously the value of network 2 would be much higher.

That alone would not be very important, as the fee is calculated per byte and not per transaction. Micro-transaction providers only really help scalability if most of the transactions can be carried out inside their ecosystem (e.g. between online wallet accounts of the same provider). With Lightning Network the same thing occurs but at least the LN providers cannot run away with your money (if you are wary).


I disagree, and this blog post (I think I remember the author being a "big blocker", but I hope I'm allowed to link to it here) explains why. There is no advantage being a "digital gold" - the advantage of a cryptocurrency like Bitcoin to others is their user network (=network effect).

The second layer is Micro-payment processors. They are already around like Epay.info and FaucetHub.io for faucets. It's very easy because Bitcoin stays the same, and the 3rd party sends bulk transactions with a SINGLE FEE.

Ultimately you have to trust 3rd parties for your micro and dust transactions. Or use Litecoin, Ethereum, Dogecoin, etc. They are accepted most places anyway. We must not sacrifice the security of Bitcoin for the comfort of buying a coffee cheap.

Bitcoin is meant to be a "Digital Gold" and you don't go buying coffees with Gold Dust.

You can't have peer-to-peer electronic cash if the nodes are centralized in datacenters cause the average joe cannot anymore run their own nodes.

So you have to choose. Unfortunately, we can't scale anywhere near VISA levels onchain, so we need a second layer.

Whoever comes up with a coin that scales onchain to massive levels, is instant, decentralized, cheap... will have a real bitcoin 2.0. That seems sci-fi to me, so until then... bitcoin is king.

I wrote some days ago in a topic that will come that day that some people who do not agree with satoshi words will try to prove it as fake, so people's agree only with their views, 2 years ago a supporter of Bitcoin xt when he see this message https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2015-August/010238.html will wonder maybe its fake because this message was against their view about Bitcoin Xt, now core supporters because was to avoid a block-size increase wonders if the words from mike Hearn is really or not, so I don't have the knowledge and I'm wonder how Bitcoin can scale with 1mb block ?

I think that quote is taken somewhat out of context. Satoshi was discussing why it would not be a good idea to integrate a cryto-currency whose purpose is not to be a peer-to-peer version of electronic cash, in that case a domain registrar. Satoshi was discussing how someone who wants to buy a cup of coffee does not want to download entries relating who owns which domain, and those who want to register a domain does not want to download entries relating to who had paid for their coffee. Also he somewhat implied that if you integrate domain registrars into Bitcoin, then other registrars will likely also get integrated (that similarly have nothing to do with spending cash), for example, various county registries of deeds might get integrated into Bitcoin, and similarly, someone buying coffee in timbuktu does not care who owes property commonly known as 123 Elm Street in Maimi-Dade, FL.

I personally think that Satoshi's vision of Bitcoin was one that involved on-chain scaling in a way so that the overwhelming majority of bitcoin transactions would show up on the blockchain. I also think that one reason why Satoshi left the Bitcoin community was so that people would not say "we should make this change because Saotshi said...."

If you want to disagree with Satoshi's original vision of Bitcoin, that is within your rights, and I believe that Bitcoin was designed in a way so that if there is consensus, then Bitcoin can be changed.

I wouldn't believe Mike Hearn if he told me the sky was blue-- but regardless-- we all learn, and what I quoted was written by Satoshi years later. (I also wonder if that was the email that Hearn posted while editing out mention of payment channels, -- I know he did that in one instance)

why not give an end to block-size debate, based on satoshi view https://bitcointalksearch.org/topic/m.15366 ?