Topic: Facts about the blocksize issue (Read 1061 times)

There are people who actually want this. They are arguing for a hard max blocksize limit forever. They want Bitcoin to be forever limited to 7 transactions per second TOTAL.  These people do not understand that Bitcoin gets its value from network effects. That when Reddit, Mega, Wordpress, Bitpay merchants, Porn companies, Gambling companies, VPN companies, cab companies, restaurants, youth hostels, etc accept payment in Bitcoin it gives Bitcoin its value AND its trust (which then reinforces its value). Those companies then also need some quantity of Bitcoins for transactions which reinforces the steady demand for the currency.

If Bitcoins cost more to send they are worth LESS. They are less competitive against other methods. They are less useful, and they are certainly less used. You think the recent run up in price is due to people thinking that long term Bitcoin is basically a crippled wire transfer replacement? Maybe for people who send a lot of wires. There are more than 7 wires sent per second sent in the world. Ultimately Bitcoin couldn't even be price competitive against that one single shitty use case.  In the US we use credit cards for everything. Bitcoin makes all goods purchased with credit cards about 2% cheaper. That's an unbelievable achievement.

This fear over losing the decentralized nature of Bitcoin is ridiculous. Mining already requires specialized hardware and resources. Validation could theoretically too. However that will likely never happen. The max block size could increase 10x TODAY without affecting the the ability of almost anyone to validate on commodity hardware and bandwidth. That's today, ignoring that even if you believe Moore's law is over, some improvement will continue to be realized in storage and bandwidth. And certainly in technology as well.

If you want a crypto currency that is forever limited to 7 transactions per second go start another one. Because if this is what you want, then you ultimately want Bitcoin to fail.

If someone can come up with the average amount of transactions per day for seven billion people, it would probably help. The population is not going to rise that much in the coming decade.

Plus, when we get people on Mars, or other places, how are they going to use bitcoin? (Thinking ahead)

Exactly. The miner with the most hash power could charge a larger transaction fee for faster processing than the other miners. A smart miner would never forward transactions that included a large transaction fee To other nodes, so that they can earn the transaction fee when they finally find a block... I think trying to capitalize too early on transaction fees is just stupid. That's why we have The block reward for so many years. Don't forget, miners can force a smaller limit if they so choose. Thus, if the biggest miner has a large hash power, they may only include a few transactions in each of their blocks to increase fee they can charge.

Miners can do this now.  Nothing is stoping them.  No miner has to include free transactions.

There should be NO transaction without a fee!

Reason 1:
Fees prevent or put a cost on spam.

Reason 2:
Fees provide income for miners.

Whoever wants their tx in the block should pay. Only that is fair!

The current limit is to protect against transaction spam...at least According to the wiki. I don't think the intent was ever to leave the block size at seven transactions per second. Compared to approximately 10,000 transactions per second For a real payment processing network, seven is slightly anemic. We can't expect Bitcoin to be of any significant value if we limited to only seven transactions per second.

This whole blockchain thing is way beyond my simple scripting knowledge but what I can't understand if there's such a problem with the blockchain why not make a currency that can handle that kind of thing? Or better yet, come up with an entirely new system that works without the problems involved. This is what open source is about and what the internet is for, you have programmers from all over the world who could very easily just get together and solve the problem. Granted, they obviously wouldn't be able to mess with the original Bitcoin code but they could easily grab it and make an alternative currency that works better like with Litecoin, at least that's what I think.

Making block size a scarce resource helps seeing the limits' effect.
Of course if 7 billion people do one transaction per day, that is 7 * 10^9 * 10^3 bytes per day = 7 * 10^12 bytes / day = 7TB/day which might become an issue at some point regardless of the block size limit being 7TB/24/6=50GB/block. At such a point you will need a cluster to keep track and you will need some very good internet connection … or we keep it at 1GB/block so an averyge laptop with an average internet connection will be able to keep up by 5 years from now standards. I will watch no matter what you decide. I'm not passionate about the one side or the other.

It's fascinating to see the free market in action. However, the process can be messy too. This thread is an attempt at some organization to help people form opinions. I'm hoping this thread, as it lengthens, can contain generally agreed upon truths about the blocksize issue.

Please repost and edit with the following approx. format:

AGAINST Raising the Blocksize
__________________________________________

fact: Dynamic resizing of blocks leads toward centralization because ...

myth: ...



IN FAVOR of Raising the Blocksize
__________________________________________

fact: The current hard limit of 1MB means about 7 transactions per second. To put that into perspective about 220 million people could do 1 transaction per year.

myth:  ...