Sure, in theory anything can happen. The only way to resolve these kinds of arguments with finality is to examine many cases (not hand-picked ones), and that will take too long. Suffice it to say that such large, amazingly outperforming oligolies are extremely difficult to form on completely unregulated markets. I can't comment on your specific example, but this just general economic reasoning.
Some relevant videos for this blocksize issue:
http://www.tomwoods.com/blog/the-problems-with-antitrust/
https://www.youtube.com/watch?v=IYO3tOqDISE
Topic: The fork - page 2. (Read 5058 times)
Hmm sounds like you agree with Cunicula then, that one corporation running the whole thing, providing transactions at the lowest visible fee, is not a problematic outcome.
So for the "dumping" case it does not matter that they are able to use massively deep pockets or massively long term forward-looking to justify to themselves, and to actually accomplish, "dumping" long enoguh to drive all competitors out of the market and to establish sufficient barriers to entry to keep any potential competitors from being able to raise a hand, invisible or not, against them?
Getting ownership of prime tourist hotel real-estate in a quaint and picturesque locale seems like plenty of justification for "dumping" plenty of stuff.
Do you know of any references pointing to these starving people the documentary glibly chose to overlook?
-MarkM-
So for the "dumping" case it does not matter that they are able to use massively deep pockets or massively long term forward-looking to justify to themselves, and to actually accomplish, "dumping" long enoguh to drive all competitors out of the market and to establish sufficient barriers to entry to keep any potential competitors from being able to raise a hand, invisible or not, against them?
Getting ownership of prime tourist hotel real-estate in a quaint and picturesque locale seems like plenty of justification for "dumping" plenty of stuff.
Do you know of any references pointing to these starving people the documentary glibly chose to overlook?
-MarkM-
That remark about hidden costs seems disingenuous. The flour was in fact cheaper, and everyone who needed to eat bread was better off for it. Restricting that cheap flour would have been the same, at the marginal level, as starving people to death. Which are the real hidden costs?
A free market will centralize as much as is efficient, but no more. Each market actor has incentives that change with the level of centralization. I think things will take care of themselves if the miners are free to float their own limits.
A free market will centralize as much as is efficient, but no more. Each market actor has incentives that change with the level of centralization. I think things will take care of themselves if the miners are free to float their own limits.
Pool operators might have another incentive to make blocks massive too: to make it infeasible for the users of pools to check the blocks the pool has them working on. History has already shown that pool owners can get away with some pretty questionable stuff wthout users caring one whit just so long as money still keeps coming in.
But maybe that doesn't matter either, since after blocks are completed people can point to whatever nasty underhanded things the pool operator did with the hashing power the users put at their disposal and it will be seen again that the pool-users just don't care.
How far does/can/will that go, I wonder?
"Oh crybabies, moaning that our high paying pool enabled a bunch of double-spend attacks, if you care about double spends pay more protection money uh I mean insurance..." ?
By the way thanks for digging deep for your best counter-arguments, excellent work.
I saw an entire documentary once on the destruction of an entire culture, way of life, and community by "dumping" of cheap flour from over the mountain pass that is only navigable for a brief period each year. Pretty soon that cheap flour left all the independent landowning families who had lived well there for centuries out their land and their independent way of life, reduced, those of them who could even kiss enough ass to land such a "wonderful", "civilised" job to bell-hops and such in the tourist hotels that took their ancestral land right out from under them.
Just dumping simple sacks of flour "cheaper" (hidden costs such as loss of ancestral lands and independent lifestyles remaining hidden until it was "too late" to save them) than one could get it from the neighboring family you and your ancestors had traded with for generations pretty much threw everyone out of their own ancestral homes and reduced a free, independent people into servitude to their foreign new "masters".
So the claim that "dumping" never works seems somewhat dubious to me...
-MarkM-
But maybe that doesn't matter either, since after blocks are completed people can point to whatever nasty underhanded things the pool operator did with the hashing power the users put at their disposal and it will be seen again that the pool-users just don't care.
How far does/can/will that go, I wonder?
"Oh crybabies, moaning that our high paying pool enabled a bunch of double-spend attacks, if you care about double spends pay more protection money uh I mean insurance..." ?
By the way thanks for digging deep for your best counter-arguments, excellent work.
I saw an entire documentary once on the destruction of an entire culture, way of life, and community by "dumping" of cheap flour from over the mountain pass that is only navigable for a brief period each year. Pretty soon that cheap flour left all the independent landowning families who had lived well there for centuries out their land and their independent way of life, reduced, those of them who could even kiss enough ass to land such a "wonderful", "civilised" job to bell-hops and such in the tourist hotels that took their ancestral land right out from under them.
Just dumping simple sacks of flour "cheaper" (hidden costs such as loss of ancestral lands and independent lifestyles remaining hidden until it was "too late" to save them) than one could get it from the neighboring family you and your ancestors had traded with for generations pretty much threw everyone out of their own ancestral homes and reduced a free, independent people into servitude to their foreign new "masters".
So the claim that "dumping" never works seems somewhat dubious to me...
-MarkM-
So then we should just remove all limit on block size and see how many movies people decide to store in the primary blockchain using a minor modification of the "store movies in the namecoin blockchain" tool currntly being ooh'd and aah'd over in the Alternative Cryptocurrencies forum and just see how farkin big the blockchain can get when fees are not justifiable anymore except possibly as anti-spam measures (and whats with calling movies spam, anyway, scared of needing a little bit of space or bandwidth or something?)
-MarkM-
-MarkM-
Yeah yeah right, and your block will propagate because pool operators are incapable of setting their own tolerance levels. Right.
So then we should just remove all limit on block size and see how many movies people decide to store in the primary blockchain using a minor modification of the "store movies in the namecoin blockchain" tool currently being ooh'd and aah'd over in the Alternative Cryptocurrencies forum and just see how farkin big the blockchain can get when fees are not justifiable anymore except possibly as anti-spam measures (and whats with calling movies spam, anyway, scared of needing a little bit of space or bandwidth or something?)
-MarkM-
-MarkM-
My general impression on this issue is that it's socialists vs. libertarians, or central planners vs. people who believe in spontaneous order. Is there more to it?
I can't avoid seeing it that way too.
You don't understand. I use Bitcoin because it is built upon certain principles and built in such a way that those principles can't be "legislated" away with a rule change. If this isn't the case I have no use for Bitcoin.
The main economical principles of Bitcoin are not being threatened. If they were, I would be among the "resistance" for sure.
What happens is that there's this damn constant limit Satoshi inserted in the code because he couldn't think of something better at the moment he was coding, and now this thing is haunting us.
Wanting to cripple Bitcoin scalability just because you fear that a super-cartel of pool operators would pop up without such handicapping limit? Seriously?
That looks very much too me like the argument for anti-trust laws. This talk that high-bandwidth pool operators would voluntarily pad their blocks with useless data in a desperate attempt to kick out low-bandwidth pools*, risking with that to increase their propagation time and thus also increase the chance of losing their reward... to me it sounds just like the argument that price dumping works. History and economical theory show us that price dumping doesn't work.
That summarizes it in economical jargon for me: the resistance against dropping the limit believes that "dumping techniques" can work, and fear that dropping the limit would be like dropping anti-trust laws. They are wrong.
* By the way, for totally different reasons, it's already not really possible to be a low-badwidth pool. The reason for this is not the Bitcoin protocol per se, but DDoS attacks from bot operators mining on different pools. Unfortunately most major pools were already DDoSed. Ultimately the only defense against such kind of attach is large bandwidth.
DId you read that entire thread, though, and related threads?
Apparently the ideal, for a miner, is to ignore/be-ignored-by just under half of the hashing-power.
Make your blocks big enough that only 51% of the hashing power will have time to process it.
That way the top 51% of miners drive out all competitors, while the number of them that are still part of the top 51% after each round of ousting of the minority goes down and down, until it is down to just a few super-powers, among which 51% of the hashing power still might add up to less than all of those superpowers, resulting in even superpowers starting to be squeezed out, and so on...
-MarkM-
Apparently the ideal, for a miner, is to ignore/be-ignored-by just under half of the hashing-power.
Make your blocks big enough that only 51% of the hashing power will have time to process it.
That way the top 51% of miners drive out all competitors, while the number of them that are still part of the top 51% after each round of ousting of the minority goes down and down, until it is down to just a few super-powers, among which 51% of the hashing power still might add up to less than all of those superpowers, resulting in even superpowers starting to be squeezed out, and so on...
-MarkM-
I suppose it's not technically a fork if the majority of miners chose something is it? Here is a relevant quote from the development forum
I think this is exactly the right thing to do.
There is still the question of what the default behavior should be. Here is a proposal:
Ignore blocks that take your node longer than N seconds to verify.
I'd propose that N be: 60 seconds if you are catching up with the blockchain. 5 seconds if you are all caught-up. But allow miners/merchants/users to easily change those defaults.
Rationale: we should use time-to-verify as the metric, because everything revolves around the 10-minutes-per-block constant.
Time-to-verify has the nice property of scaling as hardware gets more powerful. Miners will want to create blocks that take a reasonable amount of time to propagate through the network and verify, and will have to weigh "add more transactions to blocks" versus "if I add too many, my block will be ignored by more than half the network."
Time-to-verify also has the nice property of incentivizing miners to broadcast transactions instead of 'hoarding' them, because transactions that are broadcast before they are in a block make the block faster to verify (because of the signature cache). That is good for lots of reasons (early detection of potential double-spends and spreading out the verification work over time so there isn't a blizzard of CPU work that needs to be done every time a block is found, for example).
So the gist of it is......... if we don't raise the block size limit we will have to make bitcoin clearing houses or the network will become unusable except for moving large amounts of money. And transaction fees will be 20+ dollars for moving money. Sounds like a bad idea to me. Exchanges are already the weakest link of bitcoin because government intervention is the greatest potential problem and taking down an exchange is the easiest target. Clearing houses would make things easier to disrupt. Destroy? Maybe not. But it will certainly destroy peoples wealth if they store it in bitcoins. The whole idea that raising the limit will create centralization of miners seems bogus to me and not an actual real problem.
Why don't we just let miners to decide the optimal block size?
If a miner is generating an 1-GB block and it is just too big for other miners, other miners may simply drop it. It will just stop anyone from generating 1-GB blocks because that will become orphans anyway. An equilibrium will be reached and the block space is still scarce.
If a miner is generating an 1-GB block and it is just too big for other miners, other miners may simply drop it. It will just stop anyone from generating 1-GB blocks because that will become orphans anyway. An equilibrium will be reached and the block space is still scarce.
I think this is exactly the right thing to do.
There is still the question of what the default behavior should be. Here is a proposal:
Ignore blocks that take your node longer than N seconds to verify.
I'd propose that N be: 60 seconds if you are catching up with the blockchain. 5 seconds if you are all caught-up. But allow miners/merchants/users to easily change those defaults.
Rationale: we should use time-to-verify as the metric, because everything revolves around the 10-minutes-per-block constant.
Time-to-verify has the nice property of scaling as hardware gets more powerful. Miners will want to create blocks that take a reasonable amount of time to propagate through the network and verify, and will have to weigh "add more transactions to blocks" versus "if I add too many, my block will be ignored by more than half the network."
Time-to-verify also has the nice property of incentivizing miners to broadcast transactions instead of 'hoarding' them, because transactions that are broadcast before they are in a block make the block faster to verify (because of the signature cache). That is good for lots of reasons (early detection of potential double-spends and spreading out the verification work over time so there isn't a blizzard of CPU work that needs to be done every time a block is found, for example).
So the gist of it is......... if we don't raise the block size limit we will have to make bitcoin clearing houses or the network will become unusable except for moving large amounts of money. And transaction fees will be 20+ dollars for moving money. Sounds like a bad idea to me. Exchanges are already the weakest link of bitcoin because government intervention is the greatest potential problem and taking down an exchange is the easiest target. Clearing houses would make things easier to disrupt. Destroy? Maybe not. But it will certainly destroy peoples wealth if they store it in bitcoins. The whole idea that raising the limit will create centralization of miners seems bogus to me and not an actual real problem.
It looks like the natural order will take care of this.
If transactions fees rise and confirmation times prove an obstacle and there is no fork, Mt. Gox and others will be incentivized to set themselves up as clearinghouses, large and low-priority transactions will still happen on-chain, and to the extent that the centralized nature of those clearinghouses becomes problematic eventually Ripple or other spontaneous solutions will arise.
If on the other hand there is a hard fork split about half and half, we may end up with a sort of "gold and silver" bi-bitcoinism with each coin's value ending up halved (which would set the price back a whole month), confidence would be shaken because the 21 million coin limit would seem to some to be continually expandable, but then the problem would be solved and in a few years/months confidence would be regained. Not ideal, but if there is really a problem here there may have to be some slowing in adoption for it to be resolved.
If transactions fees rise and confirmation times prove an obstacle and there is no fork, Mt. Gox and others will be incentivized to set themselves up as clearinghouses, large and low-priority transactions will still happen on-chain, and to the extent that the centralized nature of those clearinghouses becomes problematic eventually Ripple or other spontaneous solutions will arise.
If on the other hand there is a hard fork split about half and half, we may end up with a sort of "gold and silver" bi-bitcoinism with each coin's value ending up halved (which would set the price back a whole month), confidence would be shaken because the 21 million coin limit would seem to some to be continually expandable, but then the problem would be solved and in a few years/months confidence would be regained. Not ideal, but if there is really a problem here there may have to be some slowing in adoption for it to be resolved.
Long, long ago, there was a gold hard fork, it generated a green gold which is as light as feather, and there was a government rule: From now on we should use green gold to exchange, since it is much easier to carry and store
Conversion rule: Each one cattle worth of original gold can claim one cattle worth of green gold, and owner can keep that original gold, since it is not supported in the new government trading system anymore.
But, the original gold still can be used in old trading system which would become more like a black market after the government trading rule change
What happened then ...
The funny thing is, there is some similarity in this story and a currency reform performed by north korea not long ago:
https://bitcointalksearch.org/topic/another-extreme-on-the-planet-144141
The similarity? Rule change impacted the monetary ecosystem in an unpredictable way
Conversion rule: Each one cattle worth of original gold can claim one cattle worth of green gold, and owner can keep that original gold, since it is not supported in the new government trading system anymore.
But, the original gold still can be used in old trading system which would become more like a black market after the government trading rule change
What happened then ...
The funny thing is, there is some similarity in this story and a currency reform performed by north korea not long ago:
https://bitcointalksearch.org/topic/another-extreme-on-the-planet-144141
The similarity? Rule change impacted the monetary ecosystem in an unpredictable way
I use Bitcoin because it is built upon certain principles and built in such a way that those principles can't be "legislated" away with a rule change. If this isn't the case I have no use for Bitcoin.
A hard fork has to happen before year 2036 in order to bump the timestamp from a 32 to a 64 bit integer. Will you be ditching Bitcoin for that reason? What's the difference between calling the 32-bit timestamp requiring a hard fork to change a fundamental principle and any other hard fork change? If your answer is "a change tweaking the economic side of things" does that mean the Bitcoin contract only includes economic reasons and not technical? Who defines what change is economic vs technical? Why do you think this contract exists when nobody's bothered to spell it out?
It appears to me that what we have here is a situation where some people have dreams of being the next JP Morgan by forging Bitcoin into a solution whereby only a few can run it. Namely themselves in their dream world I suspect. The pesky block size limit is interfering. The sad thing is that Bitcoin is already large enough that these folks would likely fall to the 'big fish, little fish' phenomenon...although they still might make some money off it.
A lot of people who were initially drawn to the Bitcoin solution will innately reject the centralization which would occur with unlimited growth. Hopefully the core developers who most people put a some of faith in will as well. Confident assurtions that Stratum is 'the future of Bitcoin' aside, a lot of us are going to think it sucks just on principle if nothing else. Not to mention disgust at ham-handed OPs on the bitcointalk.org forum trying to put words in Gavin's mouth.
Edit: --- I should have read the corresponding tech thread first. On that thread I strongly agree with the OP of this thread's stance, and disagree with the Gavin's and Mike's posture on the topic. I believe that both Gavin and Mike underestimate the risk of Bitcoin needing to deal with an actively hostile block of governments and corporations in the days and years ahead.
I use Bitcoin because it is built upon certain principles and built in such a way that those principles can't be "legislated" away with a rule change. If this isn't the case I have no use for Bitcoin.
A hard fork has to happen before year 2036 in order to bump the timestamp from a 32 to a 64 bit integer. Will you be ditching Bitcoin for that reason? What's the difference between calling the 32-bit timestamp requiring a hard fork to change a fundamental principle and any other hard fork change? If your answer is "a change tweaking the economic side of things" does that mean the Bitcoin contract only includes economic reasons and not technical? Who defines what change is economic vs technical? Why do you think this contract exists when nobody's bothered to spell it out?
In other words what the other guy mentioned bitcoin clearing houses? How does that help decentralization?
Note that Bitcoin Clearing Houses don't centralize Bitcoin.
Such clearing houses have no power to create coins or prevent their transfer (users could revert to the core network).
A rudimentary form of this already exists. See https://en.bitcoin.it/wiki/Green_address
Mt.Gox provides green addresses and a few merchants recognize them (see bottom of the above link). Mt.Gox also conducts an estimated 80% of all bitcoin currency exchange. It probably holds sizable coin storage for the community too.
Mt.Gox could already act as a Bitcoin Clearing House, in other words. That doesn't mean Bitcoin is centralized.
Note: I think it's unwise to store a majority of coins with one eWallet like Mt.Gox. A BCH, as I see it, only holds a small balance of user's coins, the amount they expect to usually transfer. Users should probably drain their balance periodically too by default.
I can understand how needing greater bandwidth can cut off a minority of miners.. but how can it concentrate it into the hands off just the few? If you look at bandwidth usage statistics aren't a majority of the people that mine bitcoin currently considered high bandwidth already? Therefore this "centralization" simply means into the hands of what already is a majority which should theoretically get even more dispersed the more high bandwidth connections are available right? Or is some extremely powerful bandwidth connection able to eliminate "normal" high bandwidth users?
What makes you think miners are "high bandwidth"? Pools tend to have reasonable amounts of bandwidth, if only to resist DDoS attacks, but the pools aren't the issue, validation is. P2Pool is currently the best example, because every miner participating in P2Pool runs their own fully validating node that ensures the blocks produced follow the Bitcoin rules. With the getblocktemplate and stratum mining protocols, again miners know what blocks they are actually mining and can fully validate them to ensure the rules of Bitcoin are followed.
Relay nodes matter too. Because running a fully validating node is very cheap, there are lots and lots of relays out there. A core principle behind Bitcoin's security is that information is easy to copy, and hard to censor, which means that the large number of relays protect you because it's very likely you'll connect to an honest relay and you'll get an honest, uncensored view of what is happening on the network.
So your biggest fear is that alternative solutions to the block size limit won't be made? In other words what the other guy mentioned bitcoin clearing houses? How does that help decentralization?
You don't need to trust clearing houses and other payment services built on top of Bitcoin if you can run a fully validating node. The protocols by which those payment services operate can be written in such a way that everything they do, every single transaction, is auditable, and critically, if they commit any fraud, you'll be able to prove that fraud. You publish your proof of fraud on a P2P network, it'll get broadcast to everyone on the network in seconds, and the payment services business will collapse immediately. I've written about these concepts multiple times; I'll post a big summary of the options later tonight.
On the other hand, if you can't run a fully validating node, you can't monitor the on-chain activities of those clearing houses to make sure they really are still holding the funds they claim they do. You have to take their word for it. At the same time, if you can't fully validate blocks, what's to stop miners and the few remaining validating nodes from getting together and creating blocks that collect fees from transactions that don't exist, thus inflating the money supply?
I can understand how needing greater bandwidth can cut off a minority of miners.. but how can it concentrate it into the hands off just the few? If you look at bandwidth usage statistics aren't a majority of the people that mine bitcoin currently considered high bandwidth already? Therefore this "centralization" simply means into the hands of what already is a majority which should theoretically get even more dispersed the more high bandwidth connections are available right? Or is some extremely powerful bandwidth connection able to eliminate "normal" high bandwidth users?
So your biggest fear is that alternative solutions to the block size limit won't be made? In other words what the other guy mentioned bitcoin clearing houses? How does that help decentralization?
So your biggest fear is that alternative solutions to the block size limit won't be made? In other words what the other guy mentioned bitcoin clearing houses? How does that help decentralization?
Read up on "high frequency trading".
What you are thinking of as "high bandwidth" is godawfully slow compared to, say, a composite cable less than half a mile long of parallel optic fibres, or whatever the currently state of the art fastests fattest most-direct short-hop direct link is. Basically it could become infeasible to mine anywhere else than in the mining district of the mining colony in the arctic or in antarctica, with the final showdown being between those two (or actual best, since they might not have cheap power to go along with cheap cooling, so maybe Iceland as the "artic" one), with only one pole being able to win since the other is too far away to compete with it. Maybe a see-saw between them as each increases hashing-power to try to make its hemisphere the world's mining capital instead of the other hemisphere...
-MarkM-
Otherwise the basic plan seem to be to pull a bait-and-switch, selling people on a purportedly person to person grassroots currency then pulling the rug out from under them by migrating it to business-to-business then to megacorp-to-megacorp...
If the blocksize limit is lifted, and blocks continue to grow without bound, to me the plan seems to be a bait-and-switch, selling people a purportedly decentralized currency that anyone in the world can validate without having to rely on third parties, then pulling the rug out from under them by migrating it to a system where only big businesses able to invest the thousands of dollars required to purchase high-speed network connections and lots of harddrive space can validate blocks.
For it to be a p2p network, I think we need to do something like look at the median, mode or mean home computer on the median, mode or mean home internet connection and ensure our limits keep it reasonable for folks to run full nodes on such systems without sacrificing their ability to run their accounting software and their word processor and their browser at the same time...
...and a 1MiB blockchain limit does this. That's 55GiB/year, low enough that anyone will be able to afford the hard-drive space to store a full copy of the block chain for years to come. Anyone will be able to also afford an internet connection, nearly anywhere in the world, with the capacity needed to participate as a full, validating node.
Like it or not we can't have every transaction using Bitcoin on the block chain. We need to develop alternate solutions anyway for small-value transactions, and since we're doing that, why not use those solutions for day-to-day spending and keep the blocksize low enough to keep Bitcoin itself truly decentralized?
My biggest fear is these small-value transaction solutions won't be developed, and instead we'll see pressure to just keep raising the blocksize, losing decentralization each time until Bitcoin is just another PayPal.
I can understand how needing greater bandwidth can cut off a minority of miners.. but how can it concentrate it into the hands off just the few? If you look at bandwidth usage statistics aren't a majority of the people that mine bitcoin currently considered high bandwidth already? Therefore this "centralization" simply means into the hands of what already is a majority which should theoretically get even more dispersed the more high bandwidth connections are available right? Or is some extremely powerful bandwidth connection able to eliminate "normal" high bandwidth users?
So your biggest fear is that alternative solutions to the block size limit won't be made? In other words what the other guy mentioned bitcoin clearing houses? How does that help decentralization?
Yes, but, the alternative might have to be an expensive but not restricted (by KYC, privacy invasion, AML, what you are allowed to buy, who you are allowed to buy it from, which nationalities, races or creeds you can or cannot do business with etc etc etc) form of value transfer (bitcoin with block limits that keep it reasonable to run a full node at home), and/or a whole bunch of such forms so that each individual form fits easily on home computers and maybe even some home computers can merged-mine many of the forms at once like I still do right now.
(
Imagine: Pay with: BTC (highest fee), NMC (lower fee, popular with domain speculators), IXC (lower fee, lower security)...
or
Imagine: Pay withBTC: not applicable (cart's total is too low for high-value network), NMC (highest fee network handling such low value transactions), IXC (lower fee, lower security)..
etc
Or even BTC: pay whole coin, change tendered in NMC or IXC, etc...
)
-MarkM-
(
Imagine: Pay with: BTC (highest fee), NMC (lower fee, popular with domain speculators), IXC (lower fee, lower security)...
or
Imagine: Pay with
etc
Or even BTC: pay whole coin, change tendered in NMC or IXC, etc...
)
-MarkM-
Yep.
You just suggested what I predicted 4 months ago in my post Solution to the Bitcoin Foundation.
...
What I think this means is cryptocurrencies should be used transactionally, rather than as primary stores of value. I see a cryptocurrency version of xe.com showing all alt-coins values relative to gold (or USD to start). Exchange rates would be updated and available to merchants in real time. They could quote product prices in one, two, three or more currencies. They might prompt users with CC (as in currency choice, meaning they accept gold, fiat, crypto etc.) or CCC (crypto-currency choice) pricing signs.
Average consumers would store the majority of their wealth in which ever form of money they deemed most stable (likely gold) and keep about 2% or so of their wealth in other (crypto) currencies. Traditionally, actual physical exchange and storage of money has made it impractical and costly to trade in and out of currencies frequently, but the Internet and cryptocurrencies reduce or remove such barriers.
...
What I think this means is cryptocurrencies should be used transactionally, rather than as primary stores of value. I see a cryptocurrency version of xe.com showing all alt-coins values relative to gold (or USD to start). Exchange rates would be updated and available to merchants in real time. They could quote product prices in one, two, three or more currencies. They might prompt users with CC (as in currency choice, meaning they accept gold, fiat, crypto etc.) or CCC (crypto-currency choice) pricing signs.
Average consumers would store the majority of their wealth in which ever form of money they deemed most stable (likely gold) and keep about 2% or so of their wealth in other (crypto) currencies. Traditionally, actual physical exchange and storage of money has made it impractical and costly to trade in and out of currencies frequently, but the Internet and cryptocurrencies reduce or remove such barriers.
...
In before someone says p2p means peer to peer not person to person:
I suspect grassroots peer to peer networks' concept of a peer is more akin to peers as in "a jury of your peers" than to "peers as in members of the House of Lords". Pick any twelve people on the internet at random, and try to ensure the vast majority of any such picks will result in almost all of them being qualified as in having easily enough computer and network at home to run the thing.
-MarkM-
I suspect grassroots peer to peer networks' concept of a peer is more akin to peers as in "a jury of your peers" than to "peers as in members of the House of Lords". Pick any twelve people on the internet at random, and try to ensure the vast majority of any such picks will result in almost all of them being qualified as in having easily enough computer and network at home to run the thing.
-MarkM-
Otherwise the basic plan seem to be to pull a bait-and-switch, selling people on a purportedly person to person grassroots currency then pulling the rug out from under them by migrating it to business-to-business then to megacorp-to-megacorp...
If the blocksize limit is lifted, and blocks continue to grow without bound, to me the plan seems to be a bait-and-switch, selling people a purportedly decentralized currency that anyone in the world can validate without having to rely on third parties, then pulling the rug out from under them by migrating it to a system where only big businesses able to invest the thousands of dollars required to purchase high-speed network connections and lots of harddrive space can validate blocks.
For it to be a p2p network, I think we need to do something like look at the median, mode or mean home computer on the median, mode or mean home internet connection and ensure our limits keep it reasonable for folks to run full nodes on such systems without sacrificing their ability to run their accounting software and their word processor and their browser at the same time...
...and a 1MiB blockchain limit does this. That's 55GiB/year, low enough that anyone will be able to afford the hard-drive space to store a full copy of the block chain for years to come. Anyone will be able to also afford an internet connection, nearly anywhere in the world, with the capacity needed to participate as a full, validating node.
Like it or not we can't have every transaction using Bitcoin on the block chain. We need to develop alternate solutions anyway for small-value transactions, and since we're doing that, why not use those solutions for day-to-day spending and keep the blocksize low enough to keep Bitcoin itself truly decentralized?
My biggest fear is these small-value transaction solutions won't be developed, and instead we'll see pressure to just keep raising the blocksize, losing decentralization each time until Bitcoin is just another PayPal.
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