Topic: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion - page 19416. (Read 26610404 times)

me neither

I literally have no idea what you people are talking about.

Bitcoin is like brewer's yeast: by the time network stops growing it starts choking on its own piss, it's too late -- everything dies

The lines will not cross because it is a hard limit so that is mathematically impossible. The bottom line will curve and asymptote up to the top line as elastic demand is forced off the network. It may at best become tangent to it.

"The lines cross and omg! catastrophe happens" is the sophisticated wrapper around the bullshit argument "nobody goes there any more because it is too popular".

Andre#, have you developed a sense of humor yet or are you just as "spot on" as ever? 

I recall in the past, I had to wait for six confirmations to be able to use my coins; however, I believe that these days, I have only been needing to receive 3 confirmations before I am able to access my coins.  Maybe I need to look more closely at this as well in order to verify my own access thresholds?    Yet, so far in my bitcoin experiences, I have not really been rushed to have to move my coins a second time, once I've already moved them.  On the other hand, I understand that some other people can become more anxious, and possibly slightly less than half of the instances in which my transactions are being confirmed on the blockchain, I am sending the coins to someone else (rather than sending to myself or receiving the coins from someone else).

Coin



Explanation

It's may sound fancy, but it's very simple. This is a (logarithmic) graph of the number of Bitcoin transactions over time:



The interactive version is here: https://oxt.me/charts

The blue line is the number of transactions in a given month. In December and January there were 6 million transactions per month. The maximum per day that can be processed is about 250,000, so that's 7.5 million per month. To visualize that maximum, you could draw a horizontal line in the graph at 7,500,000. As you can see, the growth in transactions is pretty steady, in this logarithmic graph it's almost a straight line (so the growth is actually exponential). If you extrapolate that line to the future, it will cross the horizontal line at 7,500,000 tx at some point. In fact, if two lines don't run parallel, you know for sure they will cross each other sometime.




It will only take a few more months before the lines will cross. I wouldn't call that a long way off. And rolling out a hard fork takes time. So yes, time is running out fast.

You're both wrong -- it's like fitting your daughter with a chastity belt that has a thumb-size hole in it, thus assuring that ...oh, you can figure it out.

Actually, it's more like 500,000 per day after segwit is implemented in April.

And how many transactions are low value (uneconomic elastic demand) that will drop off when the spam limit comes into effect? http://rusty.ozlabs.org/?p=500

And how many are actually responding to the nascent fee market? http://rusty.ozlabs.org/?p=564

And not as many transactions are actually "stuck" because of block limits but rather bad wallet software not broadcasting correctly ... http://rusty.ozlabs.org/?p=573

Edit: let's keep our numbers fact based shall we? Pulling magic constants out of bottoms is bad engineering, but maybe good politics.

One of the USPs of Bitcoin is its fluidity. Being able to move funds in less than an hour, instead of (business) days. No need to maintain "cushions", of your own or rented (credit cards). Creating blockchain traffic jams sacrifices that huge advantage of Bitcoin.

Actually, it's more like 230,000 per day. Source: https://oxt.me/charts (Look at the maximum tx volumes in December and January).

You're making the ridiculously simple assumption that transaction demand is inelastic ... when all evidence points to the fact that it is highly elastic.

There are a majority of small, nonsensically so, transactions that wouldn't happen and have no economic rationale for including in a globally distributed ledger secured by $1million+ per day security of hashing power and massively redundant distributed storage database.

Until anyone comes up with a solid, fact-based plan for how to secure the network in the medium and long term future it makes no sense to kick the can and hope for the best, without verifying first what component of transaction demand is currently inelastic.

Nope, the 1MB limit is more like teaching your daughter to use self-discipline and situational awareness to avoid dangerous situations, and martial arts/marksmanship should an attempt be made.

Setting a huge block size and expecting spam tx to just go away is like dressing up in slutwear, blacking out drunk at a ghetto frat party, and hoping for the best.

Aroi mak mak ... 

Coin



Explanation

In order to have an informed position of the severity of the problem, yes.

But first, let me step back. I may have befuddled you with jargon, and jargon may differ from time to time and from place to place. But the concept is pretty simple, and I imagine you grasp it intuitively, if not intellectually by the jargon I employed.

In a two-dimensional plane, two lines that are not parallel will eventually intersect. This is a geometric mathematical law. Let us illustrate the concept with an example: https://blockchain.info/charts/n-transactions



What we are looking at is a chart of the number of Bitcoin blockchain transactions per day, plotted against the time axis of the last year. While it is very noisy, we can see that the trend over this year interval is that the number of transactions is clearly rising.

If we wanted to, we could engage in a process called 'curve fitting', where we kind of average out the high-frequency highs and lows, to show more of the trend, and less of the day-to-day variation. Even a moving 7-day average filters out a lot of spikiness: https://blockchain.info/charts/n-transactions?showDataPoints=false×pan=&show_header=true&daysAverageString=7&scale=0&address=



As we filter out the day-to-day noise, we get a curve that we can use to extrapolate into the future, to make educated assumptions about what is likely to happen to that quantity as time passes.

Let us now perform a curve fitting to a straight line - while this may not have great fidelity to the past, in the absence of additional info, it is about the best we can hope for as a prediction tool. Eyeballing the graph, we see that we have gone from 'about 90,000' transactions a day one year ago to 'about 180,000' transactions today now. Or roughly doubled in a year.

So let us mark a point today at 180,000, and another point one year ago at 90,000, and draw a straight line through these points.

So there is one of our non-parallel lines. For the other, we need a representation of the max transactions per day that can be processed, based upon the max block size. Today, that number is 'about 350,000'. A year ago, and in all the intervening time, that number is 'about 350,000'. Before that, dating back to the time the 1MB limit was put in place as a temporary DoS avoidance scheme (back when bitcoins were cheap as pennies, BTW), that number was 'about 350,000'.

To represent this on our graph, let us draw a mental line straight across from left to right at the level above the current graph, where 350,000 would be if we preserved the Y axis scale. This is our other non-parallel line.

So with the max block size fixed at 1MB, yielding a hard limit of 'about 350,000' transactions a day, we can project the slope of our actual transactions per day line into the future. We find that they intersect at a point somewhat less than a year away.


Look - I get that you're relatively new here. But rest assured we have been discussing this very issue for several years. Without that perspective in the rear view mirror, you may feel that the urgency is exaggerated. But to those of us who have been tracking this incipient problem for years, the situation does indeed appear dire.

The issue is that, once the lines intersect, growth is limited at the 'about 350,000' transactions a day level. The upward trending line of transactions a day flatlines - limited at the intersect to the system capacity. She can' take any more, cap'n'

You may claim that nearly a year is enough time to work things out. And that is the ~50% probability (assuming the 2x per year is a good curve fit). But those who have been around this for a while know that this animal seems to get adopted in fits and starts. If we had a proportional spike like we did in Jul, or in Sep, or in Dec, the system could not handle the volume. Period. No capacity whatsoever. If it was a spike, the backlog would eventually clear out. But how would the newcomers feel about their money being in limbo for a month? And what if it would have been Bitcoin's eternal September - we would kill all prospects of an explosion in adoption like the Internet experienced in 1993.

note: this is a napkin analysis. Quibbling on the actual numbers does not affect the outcome of 'we are indeed running out of time'.

And that is a fact.