Topic: Scalability - because it's good to have stretch goals - page 2. (Read 3371 times)

When something becomes so difficult that only a small fraction of entities can do it, there will be at most only a small fraction of entities doing it.  This is utterly common sense and examples abound.

For instance it is technically difficult and expensive to become an MSB and consequently there are relatively few entities doing it and thus it is possible to exert significant pressure on them from a centralized authority.  Failure to comply with requests will result in forfeiture of a significant investment and opportunity so it is not common to push back sufficiently.

Do you think that those who choose to operate in China (Microsoft, Yahoo!, etc) wish to hand over their customer info to the govt?  No, they do it because that is how the real world works.  Unfortunately we don't live in some fantasy la-la-land where Gordon Moore swoops in and makes everything OK.

Ker-ist it sounds like cjp is saying having no size limit results in forming cartels and justusranvier is saying imposing a limit aids forming cartels.

I don't care if you are or are not biased - all I care about is whether or not your concerns have a basis in reality. I've asked for this several times already, but nobody has ever been able to answer this: please show me a historical example where imposing a production quota results in decentralization.

All evidence I am aware of shows the exact opposite happens: production quotas aid the formation of cartels.

I agree as well. "Making off-chain services profitable" is a bad (evil) reason for artificially limiting block chain capacity. All other things being equal, a higher block chain capacity is better.

However, there are several reasons to think that a completely unlimited block chain capacity (or even one that's only limited by hardware capabilities) will destroy the decentralized nature of Bitcoin mining. It's not worth discussing those reasons in this thread (there are other threads for that), but if one of those reasons is true/plausible, that would justify a limitation of the block chain capacity in my opinion, even an "artificial" one. "Artificial" isn't as bad as it sounds: the 21 million BTC limit is equally "artificial", and nobody wants to get rid of that, for good reasons.

Call me biased if you want, but I'm afraid that completely removing the block size limit will make mining a centralized business, thereby destroying (nearly?) all advantages Bitcoin has over fiat currencies.

I think it doesn't fit well in any of these categories. Maybe this is because there is no real global consensus-making involved: only those parties who are involved in the transaction need to reach consensus. In the concept I'm working on, consensus is reached by the publication of data which corresponds to a previously distributed hash value. This is done by the payee, so you could say that for a single transaction, the payee is the "authority" who decides whether a transaction is committed or not.

The attack modes I've found so far are limited to "denial of service": keeping someone else's money "locked" for a limited amount of time so they can't spend it. This risk is completely user-configurable: you can limit the amount of money that can be locked this way (trade-off: it will also limit your own maximum transaction size), and you can limit the time it is locked by others (trade-off: if you set it too short, you end up doing in-blockchain transactions all the time, defeating the purpose of the off-blockchain network). Theft is not possible: someone who tries to assign himself more coins than allowed by the protocol will not be able to spend those coins either in the blockchain or in the off-blockchain network.

I think we're in agreement.

And I support optional off-chain services that people can choose to use when if doing so best meets their needs. I oppose deliberately limiting Bitcoin to make those services artificially profitable or necessary.

If it turns out that no set of technical innovations will allow miners to process extremely high transaction rates at prices that users are willing to pay, fine. If miners could process those transactions profitably but are prevented by protocol from doing so because somebody wants to inflate the value of their preferred alternative, that's not fine.

Okay, now I see what you mean. I agree. That's true...

BUT, one thing to remember is that Bitcoin is many things. Right now we all refer to it as the value that's trading on Mt.Gox at $70+. However, Bitcoin is also namecoin which now has a value of a few cents at the BTC-e exchange; it's also litecoin which has a value of $.55 on that exchange; it's also novacoin, etc. In other words, the things you cite as desirable for bitcoin transactions - irreversibility, anonymity, etc. - are always going to be available I believe. A person might not be able to conduct a certain transaction with those exact features with BTC at a time, but they could buy 100K NMC to do it, or 700 LTC, etc. As long as any cryptocurrencies of any value at all exist, people will have access to those features.

There are all kinds of transactions in the world, high priority ones, public ones, private ones. By and large most people don't always need anonymity, irreversibility, etc. I'm speaking of the current financial system. People's bank accounts are subject to all those vulnerabilities you cite. However, for many people that's not a problem. Those problems become more prominent when government encroaches on payment freedom, but that doesn't make great difference in many cases.

For the record, though, I do support large enough network capacity to handle global transactions.


Yes, I know thanks. However, the majority of Blockchain.info's users trust the site operator to (and have a noncompromised server to) do things that way. That doesn't always have to be the case. Many or most people only know what their screen shows them.

Just a note, blockchain.info encrypts/decrypts the wallets locally on the client's machine.  Assuming you have a secure password, blockchain.info can't steal your funds like MtGox could, for example.

I'm saying that restricting Bitcoin's transaction processing capability such that most users have no choice but to use off-chain transaction services, including those like Mt. Gox and Blockchain.info, will result in heists, thefts, hacks, scams and losses, cuts off nearly all users from the benefits that Bitcoin promised to provide, and makes the entire project a waste of time.

What are you saying? That services like Mt.Gox and Blockchain.info should not and will not exist in the future?

You do realize you're making my point for me, right?

Bitcoin's design doesn't prevent dishonest operators, disgruntled employees, compromised servers, government-mandated backdoors etc.

All these things are possible now with things like Mt.Gox and Blockchain.info where thousands of users trust these site operators to manage their funds appropriately.

Exactly.

This is actually the biggest worry I have about this Bitcoin "experiment". My time on the Internet has shown me people can have diametrically opposing views even when answers seem obvious.

Bitcoin is decentralized, meaning everyone has a say/vote in a way for how things work. If there is not clear consensus on how to move forward things can get messy, like with the block size issue. This problem intensifies as adoption increases and there are more opinions. For this reason I feel we need to get Bitcoin's software/protocol implementation to a sustainable change-free state sooner than later.

Before I look at the specific proposal, I want to lay out the general possibilities I see with regards to all off-chain services. Let me know if I've missed any.

1: It relies on trusted authorities for its security - Centralized systems are always less secure than Bitcoin because they are susceptible to dishonest operators, disgruntled employees, compromised servers, government-mandated backdoors, and other attacks which Bitcoin's design prevents.

2a: It relies on distributed consensus using a proof of work system - Less secure than the main chain because no individual off-chain system will have as much processing power devoted to it as the main chain. Some attackers who could not successfuly double spend on the main chain will be able to attack the off-chain system.

2b: It relies on distributed consensus using something besides proof of work which is inferior in practice - It's less secure than the main chain.

2c: It relies on distributed consensus using something besides proof of work which is superior in practice - We should switch to a cryptocurrency that uses this other method for its main chain instead of proof of work.

In none of the above cases does it make sense to use an off-chain transaction system, but if I've left something out please let me know.

Aargh, another one who doesn't get it! To me this feels like talking to people who think that Bitcoin can't have value because it isn't backed by anything. It's kind of hard to convince both groups; the difference being of course that the Bitcoin value has proven itself, while trust-free off-blockchain transactions are a theoretical concept at this moment.

If you like reading the theory, please see this thread:
https://bitcointalksearch.org/topic/decentralized-networks-for-instant-off-chain-payments-152334
If you think it isn't going to work / there are important vulnerabilities, please describe it in detail in that thread. Your contribution will be appreciated!

I'm working hard on a proof-of-concept; as soon as it's finished I'll invite some critics of the concept to try to steal from me. If even that doesn't convince you, please feel free to stay inside the blockchain, while the rest of the world goes forward.

this, fucking this.

Another example of people trying to plan future take up and getting it very wrong was IP address needs.  Lucky ipv6 has sorted this problem although it's a messy solution for some.

I would actually aim for 10 times more than we can possibly imagine as a target as it still will be wrong in some cases.

The whole beauty of bitcoin is that technically it should be able to scale to fit and only be held back by matters outside it's control, such as hardware,

10 billion users should not each create 100 transactions per day. First the majority most likely will be niggers. Second there absolutely is no need to send bitcoin transaction each time you click on someones boobs.

Bitcoin must act as a backbone when blockchain tx is required. Successful services can operate with BTC eventually like MtGoatse, but only with the same qualities as Bitcoin - anonimity, security and so on.

You should really read the off chain article before making assumptions and comparing it to paypal. Contrary to paypal it is secure by locking funds on the chain, doing multiple transactions offchain, then moving back to the chain for final settlement. It requires minimal trust, comparable to the trust of carrying cash without being robbed.