This is there to create demand/limit supply, and to allow miners to collect fees for securing transactions in the network.
Where did Satoshi mention coding the 1MB limit so that miners can collect more fees?
does it matter?
My point is that a sensible version of Bitcoin will have a limit on how much data is put into the blockchain, i.e. that scarce resources (disk space and network bandwidth) are allocated in an optimal way. The optimal way will be determined by what transactions miners voluntarily include and which blocks the market considers valid bitcoin transactions.
Think about this scenario.
A hard fork is created with a self-adjusting block size limit. All users have a balance of original, authentic 1Mb-limit bitcoins, and also, a balance of 1+XMb limit, bigblockchaincoins (BBCcoins). Exchanges will be created that allow people to exchange these two types of coins between forks.
As the two forks compete, the BBCcoins will see their blockchain keep getting larger at an exponential rate, while the bitcoin blockchain is pinned to linear growth at 1MB/10mins. People will start realizing that the vast size of the BBCblockchain is leading to lots of centralization (only few nodes verifying everything, only large mining ops able to compete). Now they are wondering whether the original bitcoin blockchain is preferable to mine/verify due to its smaller data size, and the presence of less spam, and higher fees/MB mined.
Inevitably, the original bitcoin miners are less centralized, due to the smaller, spam-free blockchain. The added security makes bitcoins more valuable than the BBCcoins, and people start selling their BBCcoins. The lower fees/Mb in mining BBCcoins also makes people want to mine bitcoins for the higher fees, and over time, BBCcoins become worth a lot less, having a 4TB blockchain, while bitcoins are worth a lot more, having a 500GB blockchain. The smart investors win, the free market wins, BBCcoin holders lose, SD bots lose.
I'm sensing some serious deja vu reading this. It sounds like another 14 point plan...
Let's be generous and assume an average 90% probability that each step in the predicted chain of events occurs as described...
Event Probability
1 100%
2 90%
3 81%
4 73%
5 66%
6 59%
7 53%
8 48%
9 43%
10 39%
11 35%
12 31%
13 28%
14 25%
End result:
25% Smooth transition. All: "Hail misterbigg"
75% Train wreck, emergency block size increase. misterbigg: "Sorry, my next prediction will be better!"
>totaleclipseofthebank