Perhaps the damage was already done with the 2008 paper (?).

The government agencies probably know who he is for years. They have resources that journalists don't have. And if a journalist can find him, well...

How many litecoins does the litecoin creator has, in terms of $$$?

You are close, in a way. Satoshi is, "somewhat" of a time traveler, bringing the future protocols of humanity's modus operandi to this day and age.

First, they don't know what it is.
Second, they don't have easy access (say buy BTCs with paypal)
Third, they don't see the point - right now.
Fourth, they don't understand how an online currency can work.

3 and 4 are what give Bitcoin enormous potential.

It is the desire of the planetary "elite" to create a global digital currency that they can monitor, control, tax, impose fees - etc, all in a very centralized manner.

When this happens, and people start getting acquainted and understanding how the "official" centralized online currency work, and why it is a tool of tyranny and enslavement of the masses, Bitcoin will be the obvious and much-superior alternative. It will have the "problem" of having slower transactions but it will not be controlled, it will not charge fees, it will not be able to render people incapable of transacting just because the establishment said so, etc etc. By that point the whole "it's simple digits" skepticism will have evaporated, because the "official" currency will be digital also.

It would be a sound way to see it, however, the "news addiction" of daytraders is veeeery exploitable. People are waiting all day for news to buy or sell... now, imagine if you had the power to make the news (controlling the decisions that affect bitcoin, controlling the media etc). What bulls and bears? These would be your pets... you would have bears and bulls running any way you want by simply moving the magic wand that creates good or bad news - while you've positioned yourself earlier than them, because, well, you create the news.

People should give no weight to "good" news to up the price because that implies that the media has also the power to drop the price by giving out "bad" news. People can choose to allow the media and the establishment to control the decisions and news, and thus the price, or they can start thinking of their own instead of waiting for trains and crashes, news, rumors, economopolitical decisions etc - which have been played before the traders get a glimpse.

Stock markets are supposedly regulated regarding news announcements of stocks etc, so that shareholders are "protected". And still they get exploited all the time through insider trading by those calling the shots and having control and foreknowledge of events. Bitcoin "players" have no obligation to announce anything to anyone. They simply play the market as they see fit. Today some "good news", tomorrow some "bad news", and the traders will dance to the tune that some others are orchestrating...

I've been reading the last couple thousand pages from the sidelines thus I have a "moderate" understanding of how this particular "game" is "played", don't worry. I was just pointing out the power that people give to the news, usually unintentionally and without understanding the process.

Even speculation needs "stimuli", and some will provide "stimuli" to those who have developed an addiction for it. Even reloading this page 100 times a day (as most will be familiar with) is a way to quench the thirst for the news/stimuli addiction. We need mooooaaar data to speculate, or decide on what/when to sell or buy... links, rumors and everything. It's the way it goes. And, well, it's exploitable. That's just the reality of it.

I don't really like giving advice on what others should do with their money.

On a personal level I think Bitcoin is worth far more than triple-digit USDs, but whether or not it'll realize, say, five or six digit numbers is highly dependent on whether people really understand its value or due to some psychological "brake" think: "wait... this is madness... bits costing XXX.XXX dollars?" Besides, everyone has their price at which they are willing to cash out. For some it was a few pizzas, for others it was $1 or $10, etc. And if it hits, say, 20k, even 1k might seem like a joke.

One, or a few billionaires contemplating diversification away from stocks-that-can-crash-and-leave-them-with-10%-of-their-net-worth, is all that it takes for "CCMF". And we are not talking about transferring a billion USD here, much less is required for bitcoin to explode.

The amount of "wealth" stored in bubble-like stocks is immense (tens of trillions). And it has a repeated history of being evaporated due to economic anomalies, black swan events, economic turmoil due to politic-economic situations etc.

Crimea can quickly escalate to economic warfare. Russians are pulling billions from the western system and US treasuries are being dumped by the tens of billions.

I see it like that: If you are a billionaire and your net worth is fluctuating a couple hundred million USD per day in the stock market - which is subject to tremendous swings due to broader conditions (and can evaporate your "wealth" pretty easily) - why would you mind diversifying to gold, real estate, bitcoins etc. Even if 99% of the billionaires don't consider bitcoin as a hedge, there are some who will - and that's massive in itself.

Does that mean you have to feed the scammers? Nope.

Yeah I mean the issuing institutions are REALLY backing their paper scam-money with ...well.... nothing.

I think the price can spike to multi-thousand dollars but only for brief periods. 3600 BTCs flowing into the market, requiring 5000$ each, for 365 days of the year, is like 18mn usd per day to sustain the price. And that's not sustainable in itself (requires 6.5bn in buying capital per year).

Long term however, after block halvings etc, the price could go very high indeed. People do not really appreciate the scarcity of bitcoin. Owning one bitcoin is like having 15 kgs of gold (12mn coins vs 180.000.000kg of above ground gold). Such is the level of scarcity involved. People who have tens/hundreds of BTCs cannot really understand what this means for 5 years ahead, just as people in 2009 could not understand why they should be excited for having XXX-XXXX BTCs.

What else? China banned BTC sequel no 1056 

I don't get all the excitement with 600$ BTC.

Wake me up at >1000$

Even at replacing 1% of Gold, it'd be 70bn marketcap. And chances of that are severely over 5%. Actually it's a pretty good bet that it'll happen, but people in countries with hard currencies cannot really understand why that will be.

For example, having the 'security' of USD or EUR (=being American or European), you tend to see BTC as irrelevant, while if your national currency is junk, you value BTC just as you would value hard-to-find-assets like gold and hard currencies. It's a concept that is very elusive to western minds / developed countries.

Even the apparent "stability" and boredom that makes traders cringe for the 250$ mark, may be a +20% gain for someone living in a country where their national currency is on a declining curve during the last months.

This is a 4bn marketcap that could potentially be 40 or 400bn marketcap in the mid-to-long term. The cost of "controlling market perception" (and by extension => price) through multiple shills, a few paid articles etc, is peanuts in comparison.

The entire btc marketcap is multiple times lower than some random mobile messaging application for smartphones that is priced in the range of ...billions. And Bitcoin represents a financial revolution as both money (total money supply = tens of trillions in marketcap) and a player in the money-transfer market (trillions in marketcap with banks, swift, credit cards).

As for the manipulation, it's unlikely big BTC whales want to hold the price down (or induce it to an artificially higher level).

-Price suppression would cost them their BTCs (dumping to lower the price)
-A price bubble would cost them a lot of fiat to sustain, to absorb daily coin production.

The fiat Elite have more to gain by manipulating BTC.

You think that most national currencies, outside of EUR, GBP, USD, CHF etc, are "sustainable"? Some countries experience severe currency devaluation like 10-20-30% or more per year. Gold, silver, bitcoins, even mechanic or electronic equipment can be a "parachute" to inflation and devaluation.

The price also doesn't matter in transactions that have to do with individuals outside the banking system. For example if a kid wants to sell his game account or a game item to an online friend of him, he can use bitcoin to the equivalent price-target. Say the kid asks 1000$ for the game account in bitcoins... whether it's 1 BTC = 1000$, or 4 BTC = 1000$ (BTC = 250$), it doesn't matter.

Then the kid can spend this 1000$ (in Bitcoins) through the online retailers, or make it fiat or gold/silver through retailers that accept BTC if he is fearful that the price might slide. But the transaction will be at the appropriate value.

There is also a bright side: Annual inflation, at these rates, will require just <300mn USD per year. If price was ~1000 USD or 10000 USD right now, it would take 1.3bn - 13bn just to keep price level.

Ideally you want coin distribution to be done as cheaply as possible, in order to not drain investment capital and then you proceed with the "pump" when inflation is not an issue or a lesser issue.

If you pump while coin distribution is still in place, and it's proceeding at a fast rate, then you need too much money to sustain the price.

We'll see what the price does a few months after the next halving...

finviz added BTC

http://finviz.com/forex.ashx

This could really boost adoption... 

Don't get your hopes up with a Greek rebellion or something. Bitcoin's value is definitely >250 but that isn't necessarily related to what Greece may or may not do. IMO it's bad pump material.

If we want back in time, to 2012 and we said to bitcoiners:

Would you be happy with

2013: 40-60$
2014: 140-180$
2015: 220-300$

...etc, everybody would be "HEEELLLL YEAAAHHH"

The only reason why there is even a slight perception of failure, is because people have seen higher prices in the past, even if these were created artificially. If price was going up gradually and organically, this wouldn't have happened and all bitcoiners would be happy / there would be no room for "bears".

Greeks MIGHT be interested in bitcoin if capital controls force them to use BTC to circumvent these. So far, no capital controls.

They are discussing here, daily ATM withdrawal limits of 50 euros

Quoting myself from another thread:

Let's just say that electronic money (euros) right now buys you nothing, either internally or from abroad - say buying stuff from the internet.

BTC bypasses the international barrier and you can buy pretty much everything on the Internet that is sold from a BTC retailer.

Even if I want cash, I can use BTC=>BTC gold merchant=>gold import=>local pawn shop=>cash (or something similar).

The bitcoin market is pretty small right now, so I'm not sure how one could capitalize on it even if they wanted to.

Right now I can't even spend 2$ with my credit card on ebay. Transactions are being rejected.

With banks closed etc, wires are not being processed. So outgoing money (Greece=>abroad) to buy btcs is out of the question for Greeks. The pump will not come from there.

This rise should not be about whether Greeks buy BTCs, but that Greece is a further example, after Cyprus, that people need to have control of their money and not be based on a centralized, government controlled system, that can confiscate their money (probable bail-in might be on the cards after the referendum, given the ECB threats), or render their money useless (digital euros right now are useless in Greece, compared to cash), or disallow them from transacting globally.

Real pump material is when ECB demands greek bank account haircut... 

With ~8% of the votes counted, NO is at 60%.

I'm watching greek tv... so no links...

edit: oh, poster above posted a screen cap from a greek tv channel.

Ok link available now: http://ekloges.ypes.gr/current/e/public/index.html#{%22cls%22:%22main%22,%22params%22:{}}

Second line (now 17%) is percentage of the total counted so far.

1) Greek capital controls remain in place, ATM withdrawals are at 50/60 euros per day, no matter the deal. Which means the only way for buying something from abroad is BTC.

2) There is increased risk for bail-in, which is far "better" pump material than capital controls

The deal has not solved any of the fundamental banking issues.

I'm seeing some small-scale activity in Greece, in the use of BTC to bypass capital controls. It's primarily done through credit / prepaid cards that are fed with BTC. Apparently the BTCs are being bought from a greek BTC exchange that accepts payments through local banks.

Cash or bank account money => Local BTC exchange => buying BTC => using a visa service that is being fed by BTCs => ability to buy something from abroad

Can somebody explain this to me like I'm a 5 year old:

XT is supposed to make bitcoin futureproof, but how is it going to achieve that, when it can be spammed up to ~1.15gb / day, meaning that it'll take just 100 days for a determined attacker to increase the blockchain to +115gb, and around a year to take it up half a terabyte. Is this "futureproofing" or ensuring that the future of bitcoin is one where it dies out of bloat and where no-one wants to download it?

Increasing the fees within the 1mb limit is a far more acceptable strategy. If that means bitcoin not doing microtransactions (at least in the traditional / on-chain way), so be it. Gold coins weren't used for microtransactions either, they had silver and copper coins for that.

The worst case scenario is that someone starts spamming the blockchain with the 8mb blocks. Then, next thing you know, people will say "ohh these 8mb blocks are full, we need bigger blocks". Then you get 20mb blocks and ~3gb/day of bloat / >1 tb per year. And who is to stop them spamming the 20mb blocks and getting them full too? What's next? We'll be asking for 100mb blocks? This is madness.

Personally I don't believe that even the 750k/1mb blocks are full by legitimate transactions and not bogus transactions. I believe these bogus transactions are created to stir a "debate" about "ohh we need bigger blocks" and stuff so that we can then go on and shoot ourselves in the foot by "accepting" larger blocks as the "natural evolution".

We have to deal with a reality here: Big banks, credit cards, swift etc, don't want BTC to succeed. Bloating it is a very cheap way they can use to kill it. It's much cheaper than a 51% and cheaper than manipulating the BTC market. And it will be FAAAAAAAAAR cheaper to enable that attack vector with 8mb or 20mb blocks.

Bloating the blockchain to DOA levels will disrupt bitcoin, not the banksters.

Besides, 8mb blocks, or even 80mb blocks, aren't enough to scale to such levels. You'd need enormous storage (and bandwidth) per day to compete with the volume of banks and credit cards.

Visa does 2000 tx/s. Bitcoin needs 300-700mb/blocks to do that, not accounting for spam.

If you add mastercard, bank transfers, swift, paypal, and, finally, cash transactions from person to person that could be digitized with btc, not even 1gb blocks would scale.

A not-so-sophisticated attacker could spam the hell out of the blockchain, while also ensuring that his bloat doesn't have the potential for much pruning.

Speaking of gold: Gold has been demonetized (ie, there are no gold coins in circulation as national currencies), so it's not like millions of gold transactions are happening every day. In terms of transactions per second, it's not very unlike Bitcoin. Yet, the ~5.8bn ounces / ~180 kilotons of gold have a marketcap of 6.5 trillion USD.

BTC is digital gold. It doesn't need to scale its transactions to billions per day for fear of death. You are only looking at the transaction aspect / epayment system aspect, and you are overlooking the store-of-value aspect.

The store-of-value aspect of Bitcoin benefits massively from the ability of any individual to run a full wallet, with the entire blockchain, and the individual being able to be their own banker and have their own bitcoins under their control, while these BTCs appreciate even from their ...non-use and scarcity, relative to the fiat money supply which is inflating and devaluing itself.


Bitcoin, aside from being a coin and payment system, is also code that can be cloned/duplicated in altcoins... so it can scale if you make multiple bitcoin-like coins, use them for fast and cheap transactions and then discard them in the long run when their blockchain is bloated (if they can't be pruned). It's like using silver, copper and nickel for other coins that are traded daily, while you leave your gold coin under the mattress.

Right now we are using our gold for dust transactions of a few thousand satoshis and pretend that we need larger block sizes. This is ridiculous waste of blockchain space - which represents a barrier to entry as it increases in size (not to mention what happens when it increases dramatically, in terms of mining, centralization etc). Let the fees take care of this kind of waste and not multiply this wasteful behavior.


Dogecoin, IIRC has 1mb blocks per minute, so, in that sense, it scales 10x compared to BTC - which is even larger than XT. But it's not like people are saying "hey the dog can scale like crazy, let's all buy the dog and go to the moon"...

I mean why hasn't anyone brought it up as a major selling point for altcoins like LTC (4x), DASH / DRK (4x), DOGE (10x) that they can scale much more than BTC due to their more frequent blocks (of similar size) if that's all it takes to overtake bitcoin, that will supposedly die from not scaling, while these coins have already "solved" that and thus they will scale much better?

If it was such an issue, the money would have already decided in favor of altcoins that are "better" than the "flawed" Bitcoin - which is also "flawed" with its very slow confirmations compared to most alts that are lightening fast when, say, you deposit into an exchange. But the reality is that the parameters of Bitcoin are known for years. People know that btc is more expensive in its tx's, that it's slower, etc etc, yet it is still dominating the crypto-market due to the store-of-value aspect which seems to be (to the market) more important than the transaction aspect.

So why all that "urgency" with the XT crap and the stress tests that were in line with a problem-reaction-solution modus operandi? Who, really believes that bitcoin will ...die, if several dust and faucet transactions which are now conducted for peanuts, are replaced by more valuable transactions?

As for the IOU argument, that's partly correct and that's why, personally, I'm less in favor of such fractional tactics, as I am in favor of altcoins or some embedded system on BTC that does something similar, instead of a third party running a fractional reserve scheme.

I'm just pointing out that even with not so many transactions, you don't simply "die" - and evidence of that is the marketcap and mobility of gold, because bitcoin is not simply a payment system, but also a store-of-wealth system.

BTC's transaction capacity was always small, and even with 8 or 32mb blocks, it's still small.

If just 10% of the global population used BTC, and they did an average of just 1 transaction per day, we'd need blocks larger than 1 GB.

Suppose we make it 1GB per block, to "scale". What will happen then? Will it "scale", or will it simply become unusable? It's a bullshit argument that "bigger is better" in this case. It isn't.

And what if we take the scenario of the entire population using it, with an avg of 2 tx per day, which requires >20gb per block?

Bitcoin will not scale to the level you want it to and definitely not by simply increasing the block size. It needs smart methods to do so.

The fact that BTC requires a lot of resources to scale, should make it expensive to use those resources. Seeing dust transactions that take up space for minimum fees, is already too painful to watch.


Nobody in the Elite would benefit from abusing network resources back then. However, the situation is different with the blockchain which, if you supply the tools to abuse it, it will be abused and bloated and rendered unusable.

Have you asked potential bitcoin users, whether they are interested in downloading TBs of blockchain before using it?

We'll send all these potential guys to use online wallets or online-based wallets, meaning a centralized ecosystem?

Besides, the cartel in the HDD industry, reminds me of the stagnation in the CPU industry after AMD lost the plot and Intel didn't rush things much in terms of evolution.

I think it was early 2011 when I bought my WD 1TB for like 60 euros, and it still costs nearly the same: I'm not seeing any serious price reduction. So HD prices don't scale as much as we'd like.


Yes he was. There wasn't any urgency or crisis that demonstrated a breakdown of the decision-making process. The dev team acknowledged that scaling improvements can be done, they issued BIPs and were debating what's the best.

Is it some kind of best practices when someone comes along and says, yes, we'll do this, and if we don't, we'll fork it? 

If Hearn's dictatorship plan passes, there will be no core devs remaining to even have a decision process. I doubt any will stay to be ordered by the "dictatorship" of Andersen/Hearn. Who will maintain bitcoin then? Hearn -who isn't very active- and Andersen? That's not going to work and it's extremely bad for the future of Bitcoin.

In the end of the day, if you ask me what Bitcoin-dev-team will do the best for the currency, it's a no brainer that current core-devs are far better, active and responsible than XT's devs.

In theory it scales as much as you want it too, but in practice it creates problems. There are tradeoffs for making a trust-less and decentralized system that consumes a lot of bandwidth and disk space to scale.

In anonymous/private coins, the scaling debate was much further ahead because their mixing or zero proof systems create much more bloat that have the potential to render their blockchain DOA - even while having tx volume like 1% of BTC.


There is no bottleneck if you pay a bit more. The fees are pretty decent, even for top priority, for a "crowded" block anyway. If someone wants his dust to move at once though, by paying peanuts, let him wait.

Bitcoin is both store of value and a service. And the service has a cost/reward ratio when using it.

My mailman has a certain limit of how many letters or packages he can deliver per hour. However the postal costs prevent companies from mailing millions of spam envelopes, and, indirectly asking my local mailman to deliver 10.000 spam envelopes per hour. Thus snail mail is used when the cost/reward ratio is adequate for the one who is using it.

I need to pay 0.60 euro, for a simple envelope that will be delivered in the same city I live - even if it's the house next door. Why shouldn't I pay a few cents for transferring 10 btc / 2300$ - when a wire transfer would take tens of dollars?

If I want to move around 0.05$, and the fee is too big, it's ok - I won't do it. That's what real life is all about. Compromises. When you want to send money to a friend through paypal (using CC), paypal charges 70 cents, whether it's 1$, or 10$, or 100-1000$. It's apparent that in the case of 1$ you won't even consider it due to the charge.

Likewise, I have a ton of junk that I could be selling in ebay, but I'm not doing it because they are heavy and the cost to mail them is, in many cases, much larger than the item itself. Thus I'm not able to sell these junk stuff because a buyer sees the item at, say, 20$ and postal fees at 30$ or 50$ or 100$ due to weight, so he is like, ok, this is absurd - fuck it. That's because the postal service has limitations while carrying weights that make you pay a lot if you are "overusing" their service. Again: These are compromises we make all the time, why would anyone expect that BTC will do everything without any compromise whatsoever?

So in crypto, in theory, you could make very large block sizes and make a mandatory fee structure that escalates dramatically as it tries to fit in a lot of transactions that are considered above rational capacity - to emulate the postal service. But, still, you won't compete with VISA's 2000tx/sec average because you can't do microtransactions at low cost.  Maybe BTC can compete with certain SWIFT and Western Union transactions, cost wise, and then get altcoins, modeled after bitcoin, to do the VISA stuff for microtransactions. Or find another way to do it.

For as long as half the block transactions are dust or near-dust, there's not much rush. Yeah, some companies might try to flood the network to "prove" that we need a bigger block, and then after the block is raised to say 8mb or 20mb, the same companies might be doing similar tests and saying "oh, yes, you see at this rate of increase for a determined attacker like us that is willing to spend XXX BTC per day in fees, it's just a matter of X time for BTC to become unusable for most, or centralized, so we have to find alternatives - and we are now selling to you the new, offchain service that will protect the future of Bitcoin"

People are saying that 1mb promotes interests of offchain companies etc, but wait what'll happen if it ever goes to 8 or 16 or 32mb blocks and these same companies become much more "necessary" to "protect the future of btc".

An increase of TPS is already being discussed by core-devs, and they are trying to find the optimal way to implement it.

With a very large percentage of BTC txs being dust, they have plenty of time to figure it out.

What we don't have the luxury to do, is to start rogue forks that create friction in the dev community. But then again, what doesn't kill you makes you stronger.

As for spam, fees and block sizes: Altcoin Monero has a dynamic sized block. Let's say that, dynamically, the size can enlarge significantly. When it was spam-attacked last year (hint: the bloat created by anonymous coins is multiple size that of bitcoin), do you think people were like "oh, it's ok we have big blocks and we are ok"? No. They had to quickly implement high fees to stop the attack as it would bloat it to unusable levels. It was the fees that stopped the attack, not the self-adapting increasing blocksize.

LTC also used a patch, in the past, to prevent some spam techniques that were used against it. BTC might need to integrate it too.

In a sense, it happened with email. Email was invented and suddenly people could communicate with virtual mails, that didn't even have the cost of paper, envelopes and stamps. A tremendous volume of communications started being done through emails, however the overpriced mail service didn't go bankrupt. Alt-services also developed, mainly for premium and higher-speed deliveries (courier) that took further load off.

But bitcoin is more than a service. It's also a store of value, like gold, due to it's limited nature. Even at 0.x TPS, even if all bitcoins were placed in a physical coin (21m physical coins) and sold as collectibles, being the "first digital, trustless, decentralized currency in human history", their price, as collectibles that would rival in significance of human progression the first ancient minted coins out of precious metals, could easily exceed 1000$ for their numismatic value alone.

People would be surprised to know that there are uncirculated nickels, cents or dollars, that cost hundreds or thousands - way more than a bitcoin costs, yet bitcoin, historically, is far larger in historical significance than an uncirculated coin of a century ago.

What I'm saying here, is that the price of BTC has a lot of speculative elements, inlcuding being the first, being scarce, being the primary means through which all altcoins are transacted to/from (BTC/altcoin pairs), being able to currently transact by itself something like 500k transactions per day, etc etc. It's not just its capacity to serve a lot of transactions - which is not exceedingly good at, that is important. And even if it becomes good at that, then, by necessity, it will lose a lot in many other areas that make bitcoin what it is.


People do not really appreciate right now what blockchain size costs. This lack of appreciation was bigger, the further back you go and it will be increasingly smaller as we go forwards. If there was a "futures" price for blockchain size utilization, the futures price would be quite high - given historical trends. Giving far more space for cheap is not what should be done. I'm in favor though for providing more space at premium or escalating prices - in order to both increase theoretical tx/s and prevent abuse.

If valid transactions are something like 1.1mb and the free space is another 6.9mb, there is high risk of including several megabytes of transaction spam per block, with very low or even zero fees. It will become expensive only if an attacker tries to fill the entire 8mb block, otherwise his average cost per megabyte of spam will be cheaper.

There are like 150-200 countries in the world, and each one has its own postal service, so it's not relevant whether the USPS is an agency like FBI and CIA, because most countries don't really have an FBI and a CIA. Where I live, postal services are regarded as something close to a utility company. They just provide a basic service to the people, like the water company or the telcos.



Works of art, collectible coins of certain age and high quality, rare antiques etc etc, always go up in value and they definitely don't fall over a cliff overnight.

Now, beanie babies, that's a different story altogether.
 

Because some parameters, when adjusted either way, work as a tradeoff. You gain something, you lose something else.

I can gain more tx/s, but I'll lose in terms of decentralization, people accepting to join Bitcoin by downloading the client, etc etc.


I mean that the price per KB that we are currently paying, will seem absurdly low in a couple of years. It will also seem absurd that we were allowing dust transactions to take place and bloat the database at virtually no cost.

What you are asking already exists: Just buy litecoin or dogecoin man.

LTC 4x block frequency / 4x capacity / cheaper to transact

DOGE 10x block frequency / 10x capacity / practically free to transact

And the solution is to change bitcoin's parameter with a TV-ads approach of "bigger is better" and "faster is better" pseudo-campaign?

So next thing we know, people will be forking bitcoin because

- it has small blocks that "don't scale" (fork already provided in the form of XT- check)

- it has 10 minute blocks ("should be 5minutes or 2 minutes, so we'll fork it for the lolz, because, yeah, people can't wait 10minutes or 60 minutes if a block is late... that can't rival visa that way"

- (once the price goes over 5-10.000$ and transactions are done in 0.00x - 0.000x btc) "it has too many decimals, most people don't like them, let's fork it with proper integer units to adequately reflect value!".

- it is very centralized due to asic manufacturers etc... "we need to shift from sha256 to an asic-resistant algorithm... we'll fork it right away".

- (after the block size increase doesn't provide adequate fee compensation for the miners): "We need to increase inflation to keep our network secure, so the 21m coin cap will be no more. The alternative of non-scaling can't be sacrificed, so we'll sacrifice the fixed cap. Fork it..."


No thanks. I prefer intelligent dialogue between the core team until they have consensus. This is a multi-billion project, you can't go like a raging bull around the place.

There is no straw man here. It's attacking the fundamental rationale behind what is happening.

2 devs saw that BTC should go another way regarding one of its parameters and they forked it. If they can do that, why not do the same for some other parameter, as they see fit?

Poster earlier said "we need faster btc, not 10 minutes BTC".

Andersen and Hearn said "we need bigger btc, not 1mb BTC"

Next thing you know, a guy who doesn't follow protocol, just like Andersen and Hearn did, forks it in favor of 2x - 5x faster transactions and claims all the other guys are cripple coiners for insisting on a time limit that is slow and that can't rival visa. He proclaims that speed is a necessary element for getting wide adoption and that otherwise we'll be favoring payment processors that can take 0-conf transactions - so we really NEED these lower conf. times.

See how good it sounds? But these populist appeals to bigger-better-faster are bullshit.

If you ask anyone whether they want a bitcoin that can transact faster or be able to cope with more transactions, they will all say yes. Why wouldn't they? But there are very good technical reasons why we don't currently have 10mb blocks, or a high block frequency, or zero fees, or or or.

For most people these technical reasons are elusive, and that means that their decision in favor of a "better" bitcoin can be heavily influenced due to all those factors that they ignore.

So let's just leave the actual devs that know how BTC works, and that perform very thorough analyses on how it'll work out if they change key parameters, to decide the next development steps of BTC.

It's not stupidity. It's just that most people in the ecosystem are formulating an opinion based on a fraction of the data and possible implications.


I'm saying leave the experts of the core team to do their work. They know what to do and they're doing it well.


Well, if avg block size is currently at 0.4mb (and even that is full of dust / spam txs which will be wiped out once fee competition starts for 1mb inclusion) and he says we "urgently" need 8mb and pretends that this is a very serious reason to fork it while in the process creating a rift among the devs and risking market uncertainty, well... you don't need to be a rocket scientist to realize that something very fishy is going on.

I don't believe he doesn't know what he is doing. He probably knows full well. It's the whole false rationale, motives and modus operandi that I'm having issues with.

This proves the point that there was no rush to get ...20MB or 8MB blocks.


That's more like a DOS attack that is temporary and can be circumvented by someone paying higher fees to get confirmed immediately.

Spam attack, in the sense of bloating the blockchain for the lolz, would be far cheaper with larger blocks as no competition means that a spammer could easily push through a few megabytes, with almost zero fees. And that kind of spam attack leaves a permanent imprint for the future. And then there is also the possibility that some third party actually wants to spend money in fees just to spam the blockchain for years worth of transactions, in a couple of weeks.


The bolded part is an assumption. Assumption is the mother of all fuckups, and, when network abuse is concerned, it will be a guaranteed disaster.

Security assumptions like "noone is going to spam the blockchain" cannot be taken for granted. If they do, then bitcoin XT is DOA. Such a level of irresponsibility and wishful thinking is unacceptable for a multibillion dollar project that wants to rival the traditional money system.

The attack vectors surrounding a system like Bitcoin, from a game theory perspective, are wider than the Bitcoin ecosystem itself.

For example, from a game theory perspective, and if we look at this only from inside the ecosystem, a spam attack that costs a few BTC per day to make the blockchain bloated doesn't make sense, so it's illogical and would not happen.

But if we look at it from the broader financial ecosystem, a rival (a bank, a credit card, the governments etc etc) might want to do just that and be willing to pay the few BTCs in fees to bloat the hell out of the blockchain. And make sure that they do that as cheaply as possible, and with as little pruning potential as possible, by designing the proper "transactions". So they pay a few hundred BTCs per day in fees just to make the blockchain unusable.

In what financial world is it acceptable for a multibillion project to be under threat through such cheap attack vectors?

The alternative attack vector of DoSing the transactions confirmed by fee competition is far more acceptable because it doesn't leave a permanent imprint and it can be bypassed by the user who wants transaction priority.

If user A wants to pay user B 10 BTCs and the confirmation can be done in one block with 0.002 instead of 0.001 btc, if he so decides to pay them, he'll pay them and get on with it.

Block size should increase in parallel with actual usage to prevent the bloat-vector conducted by a Bitcoin enemy. Scaling should be primarily improved through work in the underlying protocol or data storage.

Fee measures should already be taken to eliminate dust and spam due to this:

Apparently Satoshi was also a cripplecoiner for accepting the 1MB limit in light of the potential bloat attack vector...

Thing is, since it has been implemented, a solution has not been found regarding this issue. Lifting the cap simply negates the economic and technical disincentives to make Bitcoin XT => DOA, due to bloat.

Height   Age   Transactions   Total Sent   Relayed By   Size (kB)
373920   4 minutes   643   2,916.16 BTC   F2Pool   219.8
373919   9 minutes   127   516.29 BTC   F2Pool   36.25
373918   10 minutes   613   2,228.98 BTC   F2Pool   222.58
373917   14 minutes   294   3,492.46 BTC   AntPool   849.87
373916   17 minutes   348   1,386.76 BTC   BitFury   974.75
373915   20 minutes   1   25.00 BTC   BW.COM   0.23

LOL

No, we are just gonna see a lot less dust txs.

There was a long term chart, I think charted q3 or q4 2014, that was very successful in long-term price prediction for 2015+. Does anyone have the link?

Catchy

Half a megabyte which is full of dust / spam transactions.

The blockchain is extremely valuable to be used in this way.

Some. Most are genuine dust, spam and microgambling txs.

Because we all "know" that ...crypto is done, right? 

It depends on the nature of capital controls. Usually they are implemented to protect a government's supply of foreign exchange. Greece is "unique" in terms of having its own currency as its foreign exchange asset as well (euro), so there was a liquidity problem in the economy as well. When people don't even have cash in local currency, the problem is quite big and definitely you need the local currency to conduct everyday shopping, pay the bills etc.

It can be vastly different if local currency is ok but the only thing affected in the capital control scenario is international trade with hard currency that is prohibited by a government who want to control foreign exchange outflows.

I haven't studied the Chinese economy so I can't speculate on it that much. However, if there is any danger on capital controls for China, specifically for foreign exchange and definitely not CNY (as China controls its own currency, unlike Greece), maybe it is because people could be turning their bank deposits into USD or something, if they fear that there will be an even bigger devaluation down the road.

CNY => USD would seem to preserve wealth better than keeping it in CNY (if CNY is going to be devalued, say, 10%).

To some extent this could also be done with BTC, although BTC can be kept at your own digital wallet, instead of a USD bank account that is kind of fictitious, in the sense that plenty of governments around the world allow people to have USD accounts but are using them as their own foreign exchange reserve, and, in effect, practicing a fractional scheme with the USD of the depositors - so these USD are like "claims" rather than actual USD holdings. With a new law, all USD accounts could be turned to CNY accounts, or taxed, or, or, or, for "national interest" purposes.

If I was a Chinese worrying about CNY devaluation, I'd probably have options like these:

- turn my CNY into USD (cash, not bank account), swiss francs, euros etc
- turn my CNY into gold/silver
- turn my CNY into hard assets and investments, like real estate or serious stock
- turn my CNY into cryptocurrency

If we are talking about >1 trn economy, a couple hundred million USD that are turned into crypto, can easily fuel a small or larger rally.

Traditional money moves way too slow.

The later he has to cover it, the better

By the look of things it might take minutes, or a couple of hours

It was a matter of minutes... 419 finex

Terabytes of blockchain that are to be filled with junk, with near zero cost, does not equal scaling but an open-wide attack vector to destroy BTC.

The miners.


Money velocity of multiple dust transactions = spamming the blockchain and bloating BTC.


Can I make a script right now and start spamming the blockchain when it is in low-utilization days, with almost zero fee tx's? The answer is yes. Even with 1mb limit. And it will be far easier to do that with 10mb limit. And that's irregardless of the mining fee. You cannot simply implement a higher blocksize without enforcing a system that prevents cheap malicious use of that capacity to self-destruct BTC. It would be an idiotic move of epic proportions and people would then say "so, we are at the mercy of script kids right now?" and then claim BTC devs are incompetent for not having foreseen how their actions are enlarging the blockchain by the tens of gigabytes, and how they (or the miners) must take action to prevent this kind of spamming, and how useless these devs are for not preventing it in the first place through fee competition in a much more limited block size, etc etc.

Fixed it 

It seems like it was yesterday at 230 and now 460...

Huobi might be crashing at 2900 but it is extremely thin up to 3300.

The fundamentals are even better. Auction ended, btc miners have dumped a ton at elevated prices (so their dumping munition is much lower for future rises) etc.

1 full bitcoin (1.0 BTC) is as scarce as 12kg of above ground gold. The price will readjust itself in the long run to reflect this. I'm not saying it will go to the value of 12kg gold, but price has to adjust to accommodate the scarcity factor.

There are around 180.000 tons of above ground (=mined) gold. This is 180.000.000kg / 15.000.000btc = a ratio of 12kg per 1 btc. Or 386 troy ounces per 1 btc.

People said "oh, hubris, 1 btc is priced like gold at 1200$" but there were like 11mn btcs and 5.7bn ounces of gold. If BTC was priced in the thousandths of the BTC, or if gold was priced by the kilogram, nobody would say anything. It's all perception.

Btw, that's the ratio right now. I'm not talking about what might be mined in the future, in either gold or btc.

Scarcity on something that is useless in every sense, probably not. But bitcoin is not in that category.

Gold's annual production is around 2500 tons. There are a few metals which have a production that is counted in just a few tons per year, typically in the PGE (Platinum Group of Elements). These metals fluctuate wildly in their prices as their scarcity alone allows their marketcap and price to be squeezed high through a single buy, or dumped quite lower with a few not-so-dramatic moves in terms of $$$. But noone says "ohh Iridium is a pump and dump because it was $400 in 2010, $1100 in 2012 and fell to $400 in 2013". You know it's a small market and that fluctuations are to be expected.

Bitcoin is similar in a sense. Yet, beside being scarce, it also has something to offer. It can do online payments, it can preserve wealth in the long run - especially for multiple countries that run double digit inflation, it can be a diversification asset, it can bypass capital controls, it can offer banking services even to kids who are gaming and want to sell or buy a fictional item or a game account in an MMORPG - which would otherwise be impossible without using their parents bank/CC/paypal etc, it can even be considered a collectible as the first decentralized digital currency (which is a historic event analogous to the first coins or first paper notes). People are paying hundreds or thousands of dollars for a good condition uncirculated coin of 100 years ago, just because this type of coin is harder harder to find than a coin in average circulated or worn condition. In any case, as far as BTC is concerned, the scarcity factor means that not many people can hold 1 BTC - but we all know that. Which, by necessity, will make the prices go much higher.

Many people that are trading bitcoin do so from the U.S. or Europe and they have a fundametal problem in appreciating it. We do not really understand or appreciate the benefits of what bitcoin can do for countries that do not have numismatic stability or easy international transactions through banks/paypal/credit cards etc due to quotas, controls, government approvals to buy even 10 dollars worth of stuff, etc.

For an American or a European, bitcoin is a very misunderstood asset because most of its benefits are not readily visible. The same is true for gold btw - most people will prefer money in the bank rather than gold. Having numismatic stability for a few decades makes you forget that your currency is just faith-backed money that can fall over the cliff overnight just because there was an international shock, a war, some political mess, etc etc. But countries that are immersed in that kind of shit do not value their fiat - they only value land, gold, tangible assets, hard currency (if they can get their hands on it) and Bitcoin (because through bitcoin they can actually have the equivalent of hard currency - despite their government blocking access to hard currency). So, in a sense, hard currencies like the dollar are not directly competitive with Bitcoin, but weaker ones are, because Bitcoin is the medium to have access to dollars despite a government's effort to prevent the population from stacking foreign exchange or using it to store wealth, or using it to conducting international trade.

Traders are in awe when they see a nice 10-15% spread to a Chinese exchange, but they have no idea that some people are arbing 50 or 100% for selling BTCs (in local currency equivalent of $$$) in countries that have numismatic instability.

No because they can't go to an exchange, sell BTC, get USD to their bank account and then go to their bank and withdraw USD. They can't do that. They will get national currency instead - in most cases.

So they use BTC as a hard currency / USD-equivalent currency. The BTC payment processors do the rest: If a payment processor can accept BTC as currency and send you a shipment of tangible assets like gold, silver, technology stuff (iphones, laptops, etc etc), it's like you have actually paid with USD and paypal. But it's not necessary to spend your BTC - you can also hold them as a safer alternative (compared to local currency that is devaluating), as some do with their hard currency holdings.

Bitcoin is still "trivial". If this was happening on a large scale, we wouldn't still be at 4bn marketcap.

Usefulness + scarcity go hand in hand in this case, so both are essential elements.

Regarding the 12kg / 1 BTC scarcity ratio, there is one key parameter that is lagging for BTC in order to start catching up in price (and I'm not speaking of catching the price of 1oz of gold, but rather 400 oz of gold).

This parameter is the mining cost.

The cost of mining 12kg gold / 386oz of gold is from 200.000 USD to 400.000 USD - with a mining cost estimated at ~500 to ~1000 USD per ounce, depending the field.

The cost of mining 1 bitcoin is currently nowhere near 200k or 400k USD needed for extracting 12kg of gold and this affects its perceived value.

When bitcoin generation starts to become much slower, and mining competition makes mining quite harder, this will have to change.

Those who are in for the longer term and co-factor the mining curve situation, have a very different price estimate from those who are trading day to day.


You asked me for large scale. There is no large scale use of BTC right now, whether we are talking about the "west" or developing nations. If it was happening widely we wouldn't be at 330$. But that's precisely why the situation is bullish, because what is now happening on the fringes of society, by a few tech-savy people who happen to know and use BTC, has the potential to spread to a far bigger % of the population. One of the safest assumptions is that adoption and use will increase - unless something catastrophic happens.

You are confusing the "it's happening on a trivial scale" with "it's happening on a non-trivial scale".

Messaging software, like ICQ, back in 1996 had trivial use. A few hundred thousand people were using it. A "skeptic" could say back then 'oh, so if it's not used by the whole population it must be a failure".

....Or they could be more reasonable and say "look, this is something new, most people don't know about it, but as they do and they learn what it does and how it can make their communication better, they will start to adopt it and it's just a matter of time before the user base expands significantly".

Today messaging software of all types is used by billions of people. It has attained large scale adoption.


It's up to each individual investor to understand why they are holding it and whether it has any potential or not. But if it had already realized its potential we wouldn't be here price-wise. Nor there would be any debate on scaling, etc.


It is safe to assume 99.999%+ of the people do not know what gives gold its value (and I don't mean the obvious market demand = price). They think they do, but they don't. However to really understand the value of gold you must also understand the nature of the reality we are in. And that's something that is more scientific, esoteric - even metaphysical.

Bitcoin transactions are growing. Payment processors like Bitpay release stats that show increasing usage. Things are moving forward. Could they move faster? Of course. IMO they could move way faster if there was integration of online games and Bitcoins so that an entire new generation of tech-savy kids can grow up with Bitcoins. They don't need to be "educated" in its use nor will they find it "too complicated". The user base could explode if a few large game companies allowed gamers to buy/sell with BTCs (or altcoins) from inside the game's marketplace - while they take a commission from these transactions for maintaining the marketplace.


If you've bought at 3$ you are up 100 times and if you bought at 30$ you are up 10 times.

Losing and gaining is highly dependent on your point of entry.

In the end of the day, the spike is irrelevant. If the spike never occurred, and you told people back in the start of 2013 that in the end of '13 we'll be at 100$ from 30$, in the end of 2014 we'll be at 200$ and in the end of 2015$ we'll be at 300$ - everyone would be happy, except bears, trolls and shorters .

It's the perception that it went higher and then lower that plays with people's feelings. Otherwise the long-term trend is good.

If you want to see some real pumps and dumps in speculative commodities, check the Rhodium long-term chart;

Again, it depends where you live.

If you are in India, which is an extremely large holder of gold, and people deal with gold all the time, your national currency used to buy 1 USD with 45 INR in the start of 2011. Now you need 66 INR to buy 1 USD.

What this means, if you are living in India, is that if you dumped your INR for gold (which hundreds of millions do - something that is unimaginable for us, westerners), your fiat "losses" in your national currency are much different than those of an American.

When you have to store your wealth, and you live in a "developing" country with foreign exchange issues, capital controls, or even gold restrictions or taxes to prevent you from dumping your national currency in order to buy the X or Y hard asset, your options are limited.

This is the reality of billions of people around the world and it's an argument in favor of "sound money" compared to confetti* fiat. Naturally money will find its way towards gold, silver, btc.



* Even in the US and EU, our money is not even worth the metal it is printed on. 1c coins are zinc. In Europe it's even worse. 1c/2c/5c are all iron (steel).

Iron FFS

And they plate it with a thin layer of copper to make it appear valuable.

Fiat money was not supposed to be backed by precious metals, but then the debasement got so high that they can't even be minted on base metals like nickel and copper.

They are manipulating people perception with the copper plating - a process which adds a lot to the minting cost.

The US mint could use a zinc alloy, and in EU, they could be using a stainless steel alloy, as is, without any plating whatsoever, but they don't. They want people to think their money is copper

Monetary perception is everything for the value of money. Bitcoiners could learn a thing or two from the banksters.

Lesson learned

Reading this: https://exchange.gemini.com/user-agreement

I don't get how they can get away with reversing transactions 

"The Exchange Ledger enables immediate settlement of sale or purchase transactions when the transacting accounts contain sufficient funds. "

"All buy transactions are purchases of Digital Assets with fiat currency that settle immediately from a pre-funded Fiat Account, are recorded on our Exchange Ledger. All sell transactions are sales of Digital Assets for fiat currency that settle immediately from a pre-funded Digital Asset Account and are recorded on our Exchange Ledger."


The "GEMINI INFORMATION ACCURACY, LIABILITY AND RISKS" part, is also saying that if you settle a transaction, or incur big losses, etc, etc, tough luck.

"v. for any transaction that is completed;
...
vi. for the price at which you buy or sell Digital Assets on Gemini;"

...
"Please also note the following risks in accessing or using Gemini:

i. The risk of loss in trading Digital Assets may be substantial and losses may occur over a short period of time."
...
v. transactions in Digital Assets may be irreversible, and, accordingly, losses due to fraudulent or accidental transactions may not be recoverable;


About reversals there is the "SYSTEM DISRUPTIONS OR MALFUNCTIONS" part, which is not really about user errors as I read it.

I will use a gold analogy to show something here: Bitcoin's mining game theory is slightly different than the one gold has, in the sense that when the price of gold goes down mining can be temporarily halted in deposits which require more energy expenditure in terms of diesel etc. The gold miner knows the gold will be there to dig later, in the more "expensive" cut of land, if gold prices rise and it becomes profitable.

Now in Bitcoin there is a race against time as the production is steady for 4 years, then halved, then halved, etc. So, unlike gold, where a spike in prices can lead to production increase of the unmined gold in the expensive cuts, BTC will still get -50% production every 4 years. This knowledge of the dwindling supply (that if I don't mine today, tomorrow it won't be there to get mined - it will be lost), makes the game theory aspect somewhat more speculative and risky.

What if I mined today and dumped much later when coins-to-be-mined will have been reduced significantly and my price for the same coins will have gone up? It's something that must be factored in. So even if a miner says, ah crap, we got a halving of -50% so it's not worth it anymore, he has to remember that even at a -50% rate, in 4 years from that time, the rate will be even lower (-50% again). It's something that also works in his favor.

I'm willing to bet that all the money he'll get from the mega-banks will afford him quite a lot of financial freedom. Not sure about the rest 7bn people though

The situation with various chips claiming 28-22-20-14nm is that this is not a very "precise" measurement. For example, some components of a chip might be 28nm and some others might be 14nm. There's quite a bit of misleading practices going around with nanometer labeling.

Ideally, detailed specs would be like:

Component A of the chip is: X nm
Component B of the chip is: Y nm
Component C of the chip is: Z nm

Until then you could have a very "stretched" specification based on a single aspect of the chip.

The quality of saturation is the critical element one should be worried about.

Saturation from dust, spam, worthless micro-txs, faucets, dice, "stress tests", scripts that are purposefully wasting space in the blockchain for minimal fees, etc = nobody should even bother.

Saturation from legit txs should get a bump to accommodate for new capacity.

If you enlarge the block size prior to being genuinely saturated, you are just opening the bloat-attack-vector, wide open. And then users will say 'ohhh, this is bullshit, this program BTC requires me to download 2 tb of data prior to using it"... or, if someone is in a country where bandwidth is expensive and they are charged for over-the-top use, after, say, 100gb/month, "aaah, I can't even sync this without going over my monthly quota". Or "shit, I have to send these money out, and I'm syncing the last 30 hours and it takes an hour to do so"... because 8mb blocks are full of cheap spam and dust.

If someone says "but we can send these users to thin clients, web wallets etc", just contemplate that if this happens now, and having your own bitcoin-qt is unsustainable for a lot of people, then what will happen in 5 years or 10 years?

Block size needs a glide path that co-incides with actual usage, and marginalizes spam/dust, or makes it expensive for such txs.

Restricted space => creates fee competition => dust will become non-economically viable to move around.

So you have a policy right there. It doesn't yet work because blocks are half-full (~500kb on average) so you can still move dust with near zero cost (if you have the patience to wait), but the policy will work when legitimate transactions increase in volume to approach the block size limit. We are not there yet.

There is no "artificial limitation on everybody". Those who pay a competitive fee are included next block, even if the block size is ...100kb.

That's where the chain breaks.

Expensive is a relative term compared to your competition.

How much does a bank charge for an international bank wire?

If BTC costs < Western Union costs, Bank costs, etc = adoption continues to grow because your competition is still much more expensive than you. The money transfer industry won't go to zero fees overnight to compete with BTC.

Sounds like it will finally work like it should be.

The blockchain is too valuable a resource to be wasted by zero and ridiculously low fee txs.

And it's not only scaling but usability too. If I have a 100mb block size and it takes me a couple of hours just to sync the last day or a day to sync the last week (before I send a payment), will this be usable? Or will people say, ah yes, now you lost the ability to run bitcoin-qt, just use a thin client...

We have different interpretations of stupidity.

When I have a system that has a hole in it (bloat in blockchain through low or no fees, that can be abused as an attack vector and kill bitcoin usage and adoption in the long run), I will not go and make it larger so that someone else can sink my boat. *That* is stupidity.

Scaling is not an issue right now. Not the processing of transactions. If you want to make a legitimate transaction, you'll pay a normal fee and you'll be processed in one block.

If you enlarge the block before scaling becomes an issue, then you open the attack vector wide open for further abuse (because it is already abused with over half the transactions being dust and spam). This is beyond idiotic.

I believe when the time comes, and the need is real, the block size can be increased. If it doesn't, there will be just some fee competition that prevents a lot of low and very low value tx. So what? This is certainly the lesser of the two evils involved here.

And downloading terabytes of blockchain bloat will?

Bitcoin is a protocol and while it is true that scaling issues exist, they are being worked on to find solutions. But nobody says we all have to use just one blockchain for storing everything, and doing so with zero cost. This is not feasible. We can transact with Dogecoins for the lulz if we want to. It's still bitcoin-based tech. You can have 100 chains, or 1000 chains. The sky is the limit.

As for cost: In Greece, in order to conduct a bank wire from one bank acc of bank A to another bank account of bank B, it goes like cost 1 euro for sender, cost 3 euro for receiver. Total 4 euros of charge even if I transfer like 10 euros. Do you think this puts people off from transacting with the banks? No. They just don't do it for small amounts, or if they do they are using something like "offchain" transaction by using the same bank for internal transferring of one bank account to the other, which typically has zero cost.

So in real life you have multiple payment systems for different purposes, with multi-tiered costs, speeds etc.

In Bitcoin you want to make from microtransactions to billion $$$ transactions, in the same way, with the same speed, with the same minimal cost. Ah well, give it some time until it gets there, right now it clearly isn't capable to scale to that level. And it won't be by doubling or quadrupling, or 1000x the block size. You can't scale such a system to the degree that hierarchical systems do, but other problems plaguing hierarchical systems are dealt with. It's a balancing act.

Bloat always makes the situation worse.


Not for Bitcoin the protocol, but Bitcoin as in BTC, the currency, the BTC blockchain etc.

Gold was currency.
Silver was currency.
Copper was currency.

They were in circulation simultaneously. Why didn't they only have gold or silver coins? Because each thing served a different need.

If transactions go up significantly, there is no problem in having spillover of microtransactions into bitcoin-based altcoins. Faster, cheaper and their blockchain is a far less valuable resource that can be ...discarded in the long run if it bloats to unusable levels.


The protocol exists for all this world of opportunities. People can still use an alternate chain if they want to use the blockchain to store data, contracts, intellectual property etc etc. There is no "necessity" that it must be done on BTC's blockchain. And it won't be some kind of failure if everything doesn't fit in the BTC blockchain.

Bitcoin, as a protocol, can do that. But it doesn't need to be ONE chain for everything.

Just because one hard disk doesn't fit the world's data it doesn't mean that hard disk drive was a useless invention.

We can still use multiple hard disks, even with their finite capacity limits.

Likewise, we can use multiple blockchains to store transactions and other stuff.



Historically it was. This can't be disputed really.

Gold = high denomination coins
Silver = medium
Copper = small

Multiple blockchains do not reduce bloat on aggregate, they multiply it. However, you only download the blockchains you want. You are not forced to use 1000 blockchains if there are 1000 altcoins. You only download and use those that you like.

The vulnerability is that one can make bitcoin unusable and centralized through a very low cost attack vector if the block size is increased.

I wouldn't mind large blocks (even 20mb) if there was an adequate fee structure in place that prevents abuse.

Let's say I'm the US government and want to shut down BTC... what kind of attack vectors do I have?

Some examples:

a) Built an expensive NSA farm to get the 51%. Doable but it will cost me a few hundred millions. The reward would be to wipe off competition for the USD.
b) Bribe or hack centralized mining systems that tend to have lots of hashpower.
c) Coordinate attacks that allow a 51% attack to go through by preventing others from hashing.
d) Start stealing people's private keys through the use of monitor equipment in people's hardware (that would 'burn' that option from future use, and make it publicly known)
e) Make various DDOS / DOS attacks that have low cost
f) Bloat BTC to infinity, if BTC allows itself to be bloated in this way (and it will with large blocks), again at very low cost. Thus it will become difficult to download, adoption will be hampered and you get it to a much more centralized and vulnerable point.
g) Accumulate or confiscate stashes of BTC to manipulate price and through market manipulation, destroy the BTC market. You can also "use" various exchange owners after they get an offer they cannot refuse ("please cooperate or else you'll be thrown in jail for decades with charges of assisting money laundering").
h) Do mass damage to unsuspecting people and then claim it's BTC's fault, so you need to ban it. Stuff like mass hacking of PCs, encrypting their data and blackmailing people. Or media attacks, association with criminal activities etc etc.
i) Ban it, but then it will flourish elsewhere. So you pressure various governments to do the same. But, that too, shows desperation and panic so it's better not to ban it and go more "subtly" about it (GOTO other attack vectors).

- stuff like that.

(f) is an avoidable attack vector.

Let's say I accept DASH but you only have LTC or DOGE. At that point there are several solutions:

1) I use an exchange account for deposits of coins that I do not regularly receive, so you do nothing but send your LTC or DOGE. I then convert those to DASH which I accept and withdraw them to my wallet.
2) You first convert your LTC or DOGE to DASH which I accept, in some exchange, and send them to my wallet.
3) We use a payment processor

(in the future)
4) We use some kind of decentralized currency exchange and this process of alternating between blockchains becomes seamless, with minimal risk compared to current exchanges.

It can fit because it has a 1mb limit in place, and not, say, 20mb. It would require just 50 blocks to fill 1 gb if someone made a script to do just that.

You cannot have a multibillion dollar currency that has such an issue looming over its head.

If you have a currency where someone can throw 1 btc in fees to fill a 20mb block, then with 144btc spent you get around 3gb of bloat per day.

In a month you will need 4320 BTCs to fill 86.4gb, and in a year you'll have exceeded 1 TB for a cost of 51840 BTCs (21mn USD at current prices, much less in terms of USD if the government has hacked them or confiscated them).

Even if one is paying the fees, and is not basing his approach on waiting to confirm a lot of low fee or no fee transactions, the price is way too low for destroying a multibillion dollar currency / making it unusable / rendering it centralized.

If I were threatened by BTC and had the resources, I'd go for it. It's pretty cheap compared to what you get in return (a bloated system and the perception that "ah crap, crypto is done, it can't scale because it's way too bloated). What more could I say?

What we *really* need is to fit way more transactions in the same amount of space. And we also need a much higher fee structure, implemented ...yesterday if possible.

Eh, no. Because the issue is pretty much solvable.


First, most cryptocurrencies are based on the bitcoin protocol. So bitcoin is still in use, as a protocol, even if it isn't as a currency for a particular transaction.

If I use LTC, I still use the bitcoin protocol. The elements are pretty much the same.

Second, in some of the options, like having an exchange account, you can either use BTC, or not. For example you can accept 100 different altcoins and have it set to be converted to BTC on arrival and then make 1 fat BTC withdrawal in the end of the day (if you are a merchant). So you might have gotten paid for 300 coffees with DOGE, these money go to the payment processor or exchange, and in the end of the day you get, say, 2 BTC.


Code-wise it shouldn't be that difficult. It might be a lot of work but in essence it is a decentralized asset exchange, specifically for cryptocurrencies/altcoins, merging functionalities of different wallets in order to transact in multiple blockchains.

The logic fallacy:

When someone leaves their house, don't they lock the door? The answer is yes.

If one leaves their house they have less than 0.01% of their house being broken into. YET THEY LOCK THE DOOR.

By your rationale it would be dumb to do so... "just because one left their house doesn't automatically mean that his house will be broken into, I mean look at the statistics of how few times this has happened!!!".

The security assumption you are making, stated simply, is that just because something isn't been done on a regular basis, it's ok if we leave the gap for it to get abused. If you design systems like that you will be fucked pretty swiftly. If you want to make a robust system you start by assuming the WORST POSSIBLE SCENARIOS and trying to find mitigation strategies for dealing with them. Otherwise some other guy will say "so, let's start looking for vulnerabilities here" and they will find them if you have made assumptions of "reasonable behavior".

If BTC was made for reasonable behavior assumptions it would be a joke-coin that would not be worth billions - it would have been violated plenty of times already, in every possible way that isn't "sealed off".


That's true even with a 1MB block yet many miners are filling it with dust and near zero fee txs. This is not rational behavior.

Can the network be based on the security assumption that miners will always be rational regarding what transactions they process? I believe the answer is no, especially since they have a track record where they obviously do not behave rationally and have assisted in the bloating of the blockchain for zero cost and increased risk for the miner who might get orphaned. So you have to circumvent human stupidity at the protocol level.


Even if the fees are raised significantly it'll still be way lower than many current fees that are charged for a whole range of transactions. Besides, you are making the assumption that most people already have at their disposal paypal, banks, cards, etc and that Bitcoin is just another means of payment that they can choose from. If you already have access to paypal, banks, cards, etc, Bitcoin might be near useless to you as it offers nothing new compared to what you did yesterday. Perhaps a bit less fees or something, at the expense of market volatility where you could lose way more money from currency fluctuations compared to a predictable set-fee charge.

However, in many cases, Bitcoin is the most people will get in terms of online transactions. This applies for BILLIONS OF PEOPLE who are possible candidates to use it. Whether they are kids playing a MMORPG and wanting to buy/sell virtual stuff (and aren't of legal age to use banks/cards etc, thus using Bitcoins), or being in a country where sending $$$ internationally through the banks is problematic due to currency restrictions, etc etc.

Bitcoin is more revolutionary for countries of the non-western world than it is for the western world. Even for its property as money (and not money-transfer service) which can be considered hard currency compared to local inflationary currency.

My "no" was not in terms of dissimilarity but in terms of "the worst of both worlds". You make it sound like it's a nightmare scenario when it is not.


Bitcoin as a network protocol, blockchain technology etc, yes. Bitcoin as the BTC currency, BTC blockchain etc, no.


1) Convertibility to FIAT (BTC is the gateway to fiat)

2) Volatility reasons. Bitcoin is much more stable as a store of value than most altcoins which have very large fluctuations.

If DOGE goes down 10% without me locking it into BTC, it's like having sold 30 cups of coffee (of the 300 total) for free.


Is NXT an uber-complex cryptoccurency for developing something to that effect? http://multigateway.org/

Well, there are like 200 countries in the world. It's not a disaster if people use 5-10 cryptocurrencies.


Store of value of BTC > Store of value of altcoins


No because it is understood that in the long run, the increased use means a coin with a very bloated blockchain that will become increasingly difficult to transact with, or have a properly syncing wallet.

The idea of disposable blockchains / altcoins, that serve a role for some time and then die, should not be ruled out if scaling issues with bitcoin make tx spillover into altcoins.


Most exchanges don't support turning all shitcoins to fiat, only a few. And even then their trading pairs are very thin in volume so it's preferable to go through BTC/shitcoin pair before getting fiat. If you can't even dump a few BTCs worth of shitcoins without crashing their USD price => goto BTC pair.


It depends which fiat you are talking about. USD/EUR/GBP/CAD/AUD etc, are relatively strong currencies. But what if you live in places where after 3-4-5 years, you have huge devaluations, say your local currency was 40:1 with the USD and then you go to 100:1.

For these countries, where inflation is a given tendency, money tends to move to safer assets, like gold, real estate, even BTC. Of these assets (gold, real estate, BTC), only BTC is directly spendable as money where you can actually open a browser, order things or services, pay with BTC and voila, you are ready. This gives it a tremendous advantage.

Not to mention capital controls... from where I am right now, I can't transact internationally with fiat as my government has restricted my right to do so. I can't even buy 10$ worth of stuff from some chinese eshop if I wanted to. However, with BTCs I am not restricted the same way. So when a government can flip a switch on and off on my ability to conduct international trade, that's a huge problem right there with fiat. When a government can confiscate money from my bank account, again huge problem. And the list doesn't end there.


It does.

I mean if we get to the point where people start transacting with other chains instead of BTC, so other chains will get the problem that BTC will be avoiding. Yes, at that point, it will be "understood" that this is so.


Yes, because that won't affect the price day to day. It will be a low price, a low marketcap, but it will be ok for transactions, or pulling money once a day or week. Just not long-term storage of wealth.


If you live in a weird country, you can buy btc out of a kid that has been mining shitcoins with his GPU. You can buy dollars from the bank - if the government allows you, and in countries with currency restrictions, this won't be possible at all. So buying BTC could be far easier than buying USD, withour reverting to the black market and paying a very high premium.


Theoretically, yes, if you have BTC it's easier to go to USD. However, you can't do much with the USDs in your bank account. They are presumably there, but if you go to the ATM and click withdraw, you'll get local currency at the running conversion rate.

A country will typically allow inflow of currency into USD bank accounts, allow you to hold there your incoming wires and stuff, but what you see as 1000$ in there, isn't actually there. These USD are used by the government as "foreign currency reserves". If you want them in your hand, they won't give it to you - you'll get the local currency equivalent, at the running conversion rate. What you get instead, is a digital number in your bank account (1000$) and that's it.

The obligations of countries to pay back the foreign currency to the foreign currency account holders has a history of not getting honored, as various countries spend their foreign currency reserves and then forcibly convert USD accounts to local currency. You never got to get them in your hand in the first place, but then even the digital 1000$ are converted to local fiat.

Shouldn't it be 32000?

People sold at 30, 50, 100 and are still waiting to get their coins back. At some point, people selling at 100, 200, 300, 400, will have the same fate.

In other news:

Bitcoin Difficulty:   79,102,380,900
Estimated Next Difficulty:   93,295,173,091 (+17.94%)

https://bitcoinwisdom.com/bitcoin/difficulty

People in most of those countries already know about devaluation and inflation hence why they are ever vigilant of safer assets (gold, real estate, hard currency, mechanical equipment, btc, etc etc)

It's westerners that do not understand that, and, by extension, not realizing the consequences of BTC.

I'm not sure the rationale is entirely accurate.

Bitcoin is a new currency so the monetary base must be distributed in some way (miners getting the coins generated). Increased inflation at the start is one way to do that but it is understood the emission will be cut /2 every 4 years.

Someone FOMO'ed

I was looking at these two a while ago, pretty interesting:

https://blockchain.info/charts/estimated-transaction-volume
https://blockchain.info/charts/estimated-transaction-volume-usd

And of course:

https://bitcoinwisdom.com/bitcoin/difficulty

Bitcoin Difficulty:   79,102,380,900
Estimated Next Difficulty:   93,347,075,656 (+18.01%)
Adjust time:   After 22 Blocks, About 3.1 hours

Silver is clearly off.

1 billion oz isn't the world's above ground supply, it's closer to the annual supply

Typical production of gold is 80-90mn oz per year, silver ~800mn oz.

Bitcoin Difficulty:   93,448,670,796
Estimated Next Difficulty:   108,638,161,991 (+16.25%)
Adjust time:   After 2016 Blocks, About 14.1 days

Price spiking 

It is not "beyond you" to understand this. It is pretty elementary.

1. You can understand pretty well the concept of abuse.
2. You can understand that not 100% of humanity is dependable to behave in a good manner, 24/7/365.
3. If you leave the option of free and totally unrestrained use of the blockchain then it's just a matter of time before the blockchain is bloated to infinity by some script kiddie who creates some script and lets it run continuously and adds tens / hundreds of gigabytes of spam, "for the lulz"...
4. You can now fully grasp that fees and "limitations" are what prevent system abuse that would have already rendered BTC a swift death.
5. If you have a better solution for the problem at hand, please present it.

The question you pose is actually reversed: Who would actually be invested in a joke currency that a script kiddie can render it useless for the lolz?

It will get included later. That's spam for zero cost.


You are using a 0.1 BTC+ example. At 4 tps x 60 secs x 10 minutes, you are talking about 240 BTC in fees per block and 34.560 BTC per day. This is absurd and we all say NO.

A while ago I was sitting in front of a block explorer seeing the transactions as they happened in real time, in USD terms... there were many 0.03, 0.07$ transactions etc. This is bullshit.


The blockchain got larger, syncing times got slower, the attack left a permanent imprint. And consequent attacks will do the same. And if we had 10x blocks, it could be 10x the effect.


Clogging of trash txs don't matter (in terms of quickly doing your legitimate tx). You skip them with a normal fee. Large blocks = no fee competition = attacker gets to bloat for free. FFS they already do that with 1MB blocks.

Bullshit = not understanding the value of the blockchain and polluting it with dust and spam. But, IMO, miners carry a large responsibility for allowing the processing of such transactions which is not in anyone's long-term interest.


Sort of.


The bigger the blockchain, the more unusable and more centralized it becomes. The blockchain should grow to the degree that it has to (=legitimate transactions) and not a kilobyte more. Anything different is inefficient.

The blockchain is a valuable resource. If you treat it like a dumpster you are devaluing BTC.

Economic considerations should also be given for developing countries where bandwidth costs are high, as are imported technological goods like hard disks, ram and high end CPUs/mobos. The western world doesn't really understand the problem. Then again it doesn't even understand the value of BTC compared to soft currencies either. It came as a surprise to many to read how good BTC is performing against various global currencies. We are so fixated in dollar terms that we cannot fathom that, in some other country, BTC is actually higher than its ever been. Things that we take for granted (stable currencies, access to cheap IT stuff, access to cheap bandwidth) aren't really granted all over the planet - and especially there where bitcoin is needed most.

They have the incentive but they are not configured accordingly. Not all of them. That's why dust/spam/no-fee and "stress test" txs get processed.


The 1MB limit is definitely helping to prevent abuse. Otherwise the attack vector and the willing miners are there for exploitation in a 5MB, 10MB, 20MB block scenario.


I do not believe that BTC should stay at 1MB. If it was up to me, it would grow depending the actual organic growth of the network* and other considerations that have to do with security, centralization etc.

* by that I do not mean the number of transactions. This is a pretty useless metric if one can start issuing tens of thousands of txs.

Typically there are no big hubs or data centers, except in some cases where it makes sense due to a country being a hub for other nearby countries, so serving data regionally makes sense instead of connecting to Europe, the US, etc.

The reason is that developing countries can't get competitive rates for their connectivity. Cost per gbps is much higher than the west due to very low economies of scale. And that's also why some ISPs can give you, say, 100mbps connections and then tell you that you can't really use more than a few GBs per month for downloading (but you can use more for local sites, local ftp, local P2P use, etc - because that is traffic which at a national level is like an intranet and you are not paying Verizon or Level 3 to "feed you").

The few kilobytes indeed aren't a problem. Running a full node or syncing a blockchain that is, say, 100-200-500 GB or 2 TB will be prohibitive in cases where capping is an issue.

Not having cheap access to technology & bandwidth is a major contributing factor for this situation: https://bitnodes.21.co/

Not really. If I can buy 1 BTC and move it indefinitely as 100mn transactions of 1 satoshi, back and forth, I'll be making millions of bogus transactions for nothing. I haven't bought that "right" to fuck the blockchain and the network, sorry.

I'm also aware that as we go into the future I will be paying more and more fees, because these will start to be the main source of income for miners, instead of the block reward. That's the specification, based on pretty well thought-out game theory to both distribute the monetary base and secure the network in the long run.


The miners will get their 21mn coins, whatever anyone does.


The 1MB limit is there for a veeeery long time. Did you came before or after this patch was applied? Surely Satoshi didn't envision "crippling" bitcoin with that patch, as you imply about cripplecoiners etc, but having several vulnerabilities open as a result of the no-limitation was not an option.

When there is a vulnerability and a security patch is issued, you don't just revert the patch if you haven't found an adequate solution to the problem. This is irresponsible.

What you are saying that some assholes came around and thought Bitcoin is more useful if less people use it, is simply not true. What actually happened is that G & H came along and started selling their "bigger is better" propaganda of "XT" and at around the same time some other assholes were doing "stress tests", exploiting all the unused 1MB space, for peanuts, and bloating the blockchain with bullshit. The proposed "solution" was to bypass the patch that was there to prevent the vulnerabilities that had been discovered, despite the fact that the transaction limit was still way below the limit (bogus transactions notwithstanding) under a pretense of false urgency (the question is why?). And they seem to have added some more crap to the XT fork as well that made people repulsed by it.

Anyway that's the story. What we need for the future is a way to scale better. A way that can support hundreds of tx/s without creating bloat and centralization. This can't be achieved with a plain block size increase. The devs know it, the devs of altcoins know it, quite a few people will be working on this for months or years to come. Until then we'll have to manage with a combination of increased fees and an increased blocksize to accommodate for a legitimate increase in transactions.

Parallel to that, the blockchain will continue to scale in terms of value transacted, whether the 1MB limit is raised in the short-term or mid-term. If you have, say, an average 1MB block worth 100.000 USD in transactions, by making better use of it (no dust/spam/bogus/stress txs) you could get 10x of value inside the same block, in terms of money transacted. So, over a year, with the example given (100k USD per block vs 1mn USD per block) you jump to 52bn USD transacted per year instead of 5.2bn. And you do that, with the exact same parameters of 1MB blocks.

This is the alternate dimension of scaling (=in terms of value) which we consider a given since BTC doesn't have any issues in dealing with it. You could be sending 50$ or 1bn with ease. So if you get to have less 0.05$ or 0.5$ txs and more 5$ or 50$, you still process way more money.

You'll be seeing this go higher and higher, irregardless of the block size: https://blockchain.info/charts/estimated-transaction-volume-usd

You are using a chart that has a hidden story behind it and pretend like that story doesn't even exist.

The hidden story is that most of the transactions there are bogus, spam, dust, very low to no-fee, etc.

So to get the true representation you must know the ratio of normal transactions vs the spam/dust transactions within the capacity limit.

What will actually happen is that the ratio of the quality of txs will shift internally, within the prescribed limit. So if you have something like half a million of txs per day as a limit, and you currently have just 100k normal transactions per day (with the other 100-150k being bogus/spam/dust), then you have a 5x margin to hit the actual limit, when dust/spam/attacks are priced out and become uneconomical to execute.

If you are always considering dust/spam/bogus/attack txs to be the same in quality, then you could have an increase to 2MB tomorrow morning and by tomorrow evening someone could be filling the extra mb with "stress test" junk txs. That would prove what? That "Bitcoin is at its limit"? Just because someone has filled the new TPD limit with another 500k bogus transactions? No. It would only prove that if your block size supply is much larger than block size demand, then you can have plenty of free riders in that space. And those free riders will be using that space irresponsibly. Why not, anyway, since they aren't paying much for doing so...

Bitcoin got mainstream attention around 2013. So the first 4 years were a bunch of nerds.


It's not bullshit. They can be served by the Bitcoin technology, perhaps in other blockchains. It's not necessary to have everything in just one blockchain. From what I've read I never got the impression that Satoshi was envisioning putting all kind of crap into the blockchain.


Since the scaling debate got larger with the XT fork drama, and especially after XT got no traction, price has gone up significantly. Most people (obviously not you) trust the the core devs will do the things that are right for the future of bitcoin. If there is a problem, they'll fix it or find a solution. They work their ass off to maintain it, evolve it, make it faster and allow it to scale better. It is illogical to even propose that they want to purposefully bury it and cripple it, so that years worth of work will go down the drain. If they have a disagreement, and if the matter isn't pressing (and in this case IT ISN'T, since 1MB blocks get full with junk), they can sort it out through dialogue and consensus.


That's the consensus, yes. Even the core devs have coins or vested interest in BTC. Why would they want their "child" to go down or be problematic? So far they are doing a pretty good job of maintaining order and introducing improvements, while also not breaking consensus. That's not as easy as it sounds.

That's what it should look like when there are no "stress tests" / attacks, too much dust moving around etc. The ratio between crap and legitimate* txs is actually improving. When no attacks are ongoing and the crap is limited, we are usually peaking at around 500-550k per block (on average), otherwise it goes up to 800k (on average).

Personally I like to take some random samples during the day and check myself, I'm not using a specific chart for this, except this https://blockchain.info/charts/avg-block-size?timespan=30days&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address= for checking block usage.


* It is not necessary that a spammer should always be moving small amounts. He can also move larger amounts (if he has a large supply of Bitcoins) so that he can pretend that spam txs are "legit".

It is definitely destined to become big. However, the blockchain should not be treated like a dumpster.


It depends on the scaling parameters.


It's not unlikely that it will happen but at that point the centralization factor will have gone up ...a lot.


It's not me crying doom for 1MB blocksize and fee increases...


Not all miners behave the same way.


There's not much that a stress test can reveal that a script on a virtual testnet can't. And the second one won't have a lasting imprint on the blockchain.

I mean you know beforehand what will happen. If you start spamming, the blockchain size will start increasing, free txs will slow down a lot in their processing while those txs with fees will go through quickly.

Actually I'm concerned with far bigger attack vector implementations by "the powers that be". And the thing is, these guys are more dangerous than the average script kiddie because they also have money to pay for the tx fees. In that scenario you are fucked because they can do both bloating + tx crowding over the rest of the users, by paying more fees and rendering the network unusable. So you need much better solutions than increasing the blocksize (which will happen when it is necessary).


How many txs do you want it to handle per day?


All the bitcoin developers want Bitcoin to scale and there is 100% consensus on that. This practically guarantees it will happen, despite their differences on whether the blocksize should be raised now, raised temporarily (kicking the can), raised later, have something else done, etc etc.

The precise numbers on how scaling will go down on 5 years, 10 years, 20 years are pretty much unknown but that will not stop investments or businesses.

=> As close as it gets: https://github.com/bitcoin-dot-org/bitcoin.org/pull/1165

He's probably on the phone asking his NSA handler

Yeah I mean we could fit the world's data in the blockchain and it would be very useful and stuff when it reached a few zillionbytes, but guess what... it doesn't scale and it becomes unusable. When you go for too much you may end up losing even the basic functionality:

https://bitcointalk.org/index.php?topic=1790.msg28935#msg28935

Obviously Satoshi was a cripplecoiner for not wanting his bird to fly as high as it could... so much untapped potential wasted. Right?

There is also the factor of what type of value are we talking about per transaction.

If you are moving around 50 cents you can't pay 20 cents in fees.

If you are moving around 1000 dollars => you don't mind.

So if value per transaction increases, because, say, people start considering that BTC is better, faster and cheaper than SWIFT, Western Union etc, you can have a lot of transaction volume with (relative) high fees which are still very competitive compared to your "competitors".


Again, short and long are somewhat relative. From bank to bank, from paypal to bank, for western union etc, it takes days... That's eons of time compared to bitcoin.

For small txs you can go with 0-conf.

There is nothing preventing you from spending it, so...


We have no idea on the price direction. If BTC crashes to 10$, then subsidy and fees are already too low. If BTC goes to 45.000 a subsidy of a single coin will be like 100 current coins of 450$. USD prices are very relevant if a miner wants to pay their power bill, equipment, etc.

The world revolves around fiat. You go to your nearest Bitcoin ATM, pull 200$ out and buy your coffees and stuff with cash. So, how is it not spendable?

A real block in spending would be if the government has cut the road from fiat <=> btc, banned btc trading, banned btc transactions and retail businesses from accepting it and is short of doing anal probes if you are even remotely related with cryptocurrencies... that's more of an issue compared to fees that can be bypassed with sidechains, altcoins, cash, etc. We'll see how it goes in terms of the scaling solution implemented.

Kind of. But it depends on how the miner views the situation. Say you have a crash in price but the miners don't pull the plug because they believe this is a temporary situation that will be corrected in a few weeks, instead of taking current BTC price at face value. Ok, some will shut down because they are on a tight budget and can't afford to lose money but others are braver and then you see a slash of price by 90% and the hashrate dropping just 20-40%. It will take a very long time sitting at a very low price to reach a similar equilibrium.

And it's also the outlook of the situation not in terms of securing the network but "gaining coins". That's the miner's interest. As long as the monetary base is still being distributed, some people will get the coins anyway. Whether it is 100 miners or 10.000 miners, the coins will be there for the taking. For non miners, the ideal scenario is "the more hashpower, the better". For the miners, if it makes economic sense to pursue it, they will pursue it. Earlier in the thread some people suggested the network is oversecure etc etc. But in the end of the day what matters for the miner is if he is making profit. If he pays x for setting up and electricity and gets 2x from the coins he mines => it's worth it for him => so why not. The actual question at that point is not why the network may be at 400% more security than necessary, but why isn't it at 800% when miner costs are far lower than their profits and the market isn't self-adjusting fast enough (which is reasonable to a large degree, especially after the price moving a lot and the infrastructure not being adjusted at the same pace).

Your paradox begins and ends by applying future problems (extremely high BTC fees, which would imply a very high volume of transactions where people are REALLLYYY taking BTC seriously and are paying a lot for being able to transact with it - which are all indications that BTC is quite big at that point) by coupling it to today's anemic infrastructure, which is a fallacy.


If I have 10kg of gold in storage, as store of value, I'm not expecting to buy souvlakia and pizzas with it. I understand that I will have to sell a few grams or a few gold coins for fiat and then use fiat. That doesn't render gold useless.

The underlying equation that

gold = fiat

and fiat = anything else

makes gold spendable, for everything, indirectly, until the government says "gold transactions, selling, purchases, are all banned".

Likewise most altcoins are indirectly spendable -first through BTC- then through fiat.

Not in Greece (EU & Eurozone member).

If a friend of mine wants to send me 20 euro from his Alpha Bank account, to my Eurobank account, he gets charged 1E, I get charged 3E, and the process takes 1 day or more.

It literally costs cheaper to put a 20 euro note in an envelope and mail it first priority / next day delivery, for 0.72 euro.

Then also take the current state of bitcoin fees and transact with it, instead of projecting forward to the point where it costs 3 times the coffee in tx fees.

If we are talking about the future, you will have to apply a corresponding "futuristic" reasoning for other aspects of the ecosystem, whether it is ATM presence, widespread use of plastic cards connected to BTC, etc.


Whatever you have to say about gold, the issue remains that it is indirectly spendable and a store of value despite not being directly spendable. And this is not an anachronism. It is not something that was relative a thousand years ago. It is something relevant TODAY.

You live in a developing world country with high inflation. Your bank doesn't allow you to convert your local fiat to USD. You can't wire money outside to buy BTC. But you can still get your hands on some gold or silver in various shops. You go for it and you store your wealth in this way. Now. Not in the past. Now. Today. This is happening RIGHT NOW.

Fast forward 5 years later, the local currency has gone down massively while gold preserves its value (much more local currency corresponds to 1 gram or 1oz of gold), gold owner then converts gold for local currency and gets multiple the amount he invested in it. He then proceeds to pay bills and various expenses or make new investments, buy a house, etc.

http://goldprice.org/spot-gold.html

Go in the drop down buttons below the black chart. Try it with ARS (argentian currency), BRL (brazilian), RUB (russian), INR (india) 10 years chart. Note that gold in USD peaked at 1800 and is currently at 1000, but in other countries there is an alternate reality about the relevance of gold as store of value. An american could feel "ripped off" if he bought at the spike and is now down but someone with another currency might be thanking God.

The exact same principle can be applied to BTC and weak currencies. And BTC, unlike gold under your pillow, can actually perform international payments - where in some cases local banks prevent (they don't want to drain their foreign reserves in USD).

Most consider it a given that changing the parameters to increase block size is a trivial matter and it will happen sooner or later. Your rationale goes like "if the blocksize isn't increased right now it means it is 1MB forever" and nobody sees it that way, no matter how many times you repeat your doom scenarios. Practically all devs openly say that the blocksize will be increased at some point.

The full blocks is not a real consideration because they can be full even if blocksize goes x2 or x10. The key element is whether miners will start cutting off free txs to compensate for abuse. Then what will you say? That miners cutting off people from transacting for free is not the bitcoin you signed up for? Will you then be calling the core-dev "police" to "impose" some way where the miners are forced to include low-fee / no-fee txs?

Transaction volume in USD ~150-200mn USD

https://blockchain.info/charts/estimated-transaction-volume-usd?showDataPoints=false&timespan=30days&show_header=true&daysAverageString=1&scale=0&address=

Fees paid in USD ~10-18k USD. To move around 200 million.

https://blockchain.info/charts/transaction-fees-usd?timespan=30days&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address=

Yeah, fullblocalypse is round the corner

Block reward has two main purposes.

1) Securing the network
2) The necessary distribution of the monetary base during the first years.

BTCs will be issued due to (2) even if zero transactions exist. Same for altcoins sharing BTC code that have much less "traffic" and a lot of empty blocks.

15 of 21m are already issued - most of the monetary base distribution is over with and the upward price movement due to scarcity more than compensates. That's what the long term trend says.

Soon we'll get half block rewards and after 4 years another 50% cut.

In any case, PoS or PoW/PoS coins are an alternative for those who don't like BTC's distribution or are too anxious to reduce inflation right now (that won't happen).

There'll come a day when price movement will be 400-500$ a day....

...and we won't even be excited with them

Bitcoin Difficulty:   93,448,670,796
Estimated Next Difficulty:   105,042,722,011 (+12.41%)
Adjust time:   After 570 Blocks, About 3.5 days
Hashrate(?):   846,369,830 GH/s

You seem to be missing the point of why we are here.

BTC is not first mover in the ...centralized payment systems or centralized currencies space. The systems you mention, if they are ever created, will compete with visa, paypal, etc: Centralized stuff.

Bitcoin Difficulty:   93,448,670,796
Estimated Next Difficulty:   104,797,211,650 (+12.14%)
Adjust time:   After 100 Blocks, About 14.4 hours

http://www.zerohedge.com/news/2015-12-29/china-suspends-foreign-banks-fx-trading-offshore-yuan-spread-signals-massive-outflow

...
"To put it another way - China just unveiled 'open' capital controls... and the last time they did that Bitcoin soared."

Apparently billyjoeallen is a true visionary, unlike cripplecoiner Satoshi who put there the 1MB limit and only wanted Bitcoin's fate to be "restricted" into a much lesser role instead of wanting to include every possible dataset that can be "blockchained", into BTC's blockchain.

As an inventor, Satoshi would likely get enormous credit for creating something that could be used for 100 or 1000 stuff simultaneously instead of 1, 5 or 10. Yet he was quite open and honest about whether that would actually scale.

Satoshi showed the way: The invention of the blockchain could be used with parallel blockchains for different data sets. It was not necessary to put every single data set into the same blockchain.

But billyjoeallen knows better...

It can't be crippled. The cat is out now. But it will be "problematic" in people's perception if some try to put everything into one blockchain. Then some will say "ahhhh, as it seems this is too bloated to work... the blockchain was a stupid idea in the first place, we are better off with centralized systems - besides as this is configured right now is not much different than a centralized piece of shit...".

As for the "at this point in time", if you start using BTC's blockchain right now for other uses, against the warning that it won't scale, then what? At some point you'll have services that will need to stop altogether. Isn't it better to have a continuity plan by starting them in an alternate blockchain that is better suited for your own dataset needs and cost requirements (btc fees will eventually skyrocket, by design, due to diminishing subsidy).

As for security, there is always the possibility of merged mining to benefit from BTC's hashrate.

The application name is irrelevant. Someone would argue "why should Bitcoin make it impossible for my app to store the x, y, z data sets into the blockchain? I want bigger blocks and cheaper blocks, otherwise Bitcoin is preventing innovation".

Bitcoin, as it is, can't even scale to serve its primary purpose of e-cash in order to rival paypal, visa, etc. And then you have people who want to store all sort of stuff in the same blockchain - when these things could be stored in other blockchains. And you also have spammers who like to fill the blocks for the lulz, paying peanuts.

Obvious priority is obvious. Or isn't it?

You nailed it. That's the reason why btc is 50% down from ATH. Not the unrealistic 2013 pump & dump where price went from $10 to $1000. Obviously "smallblockers" crashed it back down to 100-200$.... 


Market prices tend to rise with increased demand. That is a market function. And when you are still lower than your closest competitor, people will still prefer your service over theirs. If a bank wire costs 10$ and takes days and a btc transfer costs 1$ and takes minutes, why would I use SWIFT instead of BTC?

In terms of industry, or services, prices tend to lower when there are economies of scale benefits. But are there economy of scale benefits in our case, or is there a proportional cost increase when you go from, say, 1mb to 100mn blocks, to accommodate 100x in demand?

What will happen, at most, is that shitcoins will be used for low-value txs and btc will be used for high value txs. You want to gamble for a few cents => you use a shitcoin. You want to buy a chewing gum => you use a shitcoin. You want to transfer 500$ or $5 mn, you use BTC.

If *everyone* uses litecoin, it won't be.

The chances of that happening is near zero for a long list of reasons.


The fee market dictates the transaction type. If you have, say, 1$ fee, you can't perform 1-2-3$ txs. You can however perform 50-100-1000-1mn USD txs.

When you have a network that does like 500.000 txs of an average 1.000-10.000$ (acting like the "SWIFT" of crypto), you are at 0.5 to 5bn USD per day.

And if you have a network that does 10 times the number of transactions, say 5mn txs, but for "small" values, like an average of 1 to 10$ per tx, it will only be at 5 to 50mn USD tx volume.

One would say "but why wouldn't people keep their money on the second coin with the many txs etc". The answer is: because it is a disposable coin / a joke coin, that will be unable to preserve functionality in the long run.

It is impossible for a low-fee coin to survive blockchain abuse, which, in the long run, will render that coin unusable. If there is no new mechanism that allows for scaling, all the reasons that prevent bitcoin from going into huge blocks are also there. And they are exploitable. Imagine you have an altcoin that tomorrow gets all the btc load for near zero fees. What's stopping script kiddies from inserting tonz of transactions for the lulz to see the network get clogged? And then people will say "oh fuck that, I came to this altcoin to escape higher fees and now I'm queued for ages and I have to pay fees again, and then, as the attackers are willing to pay even very small fees, I must now pay even higher fees, etc, etc... it's all fucked up". LTC, DOGE are affected in the same way. We'll see how DASH goes because it actually will try to do something different, through the masternode network, but anyway. If you can get many txs for free you can also spam for free and abuse the system (and then the devs will have to "react" by increasing fees to stop the abuse, etc etc). Monero got attacked that way last year I think, and they had to raise fees to prevent the blockchain from getting bloated to DOA levels.


If that altcoin has very low or near zero fees, it will be exploitable - no matter who creates it. Btw, the scenario of a Wall-Street-coin or Silicon-Valley-coin, is not a real threat due to being centralized. As I told you yesterday, these will be competing in the centralized space with visa and paypal, not with BTC.

If they are an alternative player with a decentralized currency and they arrive on the scene claiming that they can supply millions of txs for free, I can make a script to add gigabytes per day for the lolz into its blockchain. At some point, when people will not be happy with this, and the network will be threatened for its long-term sustainability, the devs will have to "react" and raise fees in order to prevent me from spamming it.

Big money will not necessarily solve the scaling issue. Code will (scaling improvements, new compression algorithms, etc). Or technology will (more storage, faster processing, greater bandwidth etc). Things that apply today, in terms of technological restrictions, might not apply in 3-5-10-15 years. But even if you have a far more capable network in terms of tx capacity, it will always be subject to abuse in a zero to low fee scenario. And thus it will need to be protected. This applies to both BTC and altcoins.

All the "evidence" the "large blockers" seem to require is whether the blocks are full or not. If they are, they say the fullblocalypse is coming, even if the blocks are full with bogus transactions.

So, from a social engineering perspective, the system is pretty vulnerable.

1. Spam the network to fill the blocks
2. Show some useful idiots that "blocks are getting full"
3. Have the useful idiots think the apocalypse is coming, due to the junk txs
4. Let the useful idiots propagate the idea that the developers are crazy for not seeing the same thing and that since the devs are not seeing the apocalypse, they are inadequate and not up to the task, or have ulterior motives to bury btc, or (insert any other conspiracy here).
5. Force devs due to social engineering pressure to increase block size (which reduces fee competition and allows cheap spamming of the blocks) against fundamental reasons not to.
6. Re-spam the enlarged blocks, now at cheaper rates

It's a "GOTO 1 - repeat - fill blockchain with junk - make BTC centralized in the process - leave it vulnerable to other attack vectors as well", situation.

But it could also play out differently... miners might decide that it's not even worth the risk of including 3-4-5-10mb of txs, as the 25 BTC or 12.5 BTC reward is much better than gaining an extra half btc (with an increased orphan risk). A 30s, 1m, 2m advantage could be significant in finding a block. So at that point we'll have a network that only processes very high fee txs to ensure the fastest propagation possible and that the miner has an advantage over the other miners who actually want to include txs in their blocks. At that point, the same people who were asking for much larger blocks, will be crying at how inadequate bitcoin devs are for creating a situation where miners do not even want to mine regular transactions but rather opt to mine only the block reward (and/or some very high fee txs). I mean this is already happening with 1MB empty blocks. Empty-blockers (miners) will be saying "haha those idiots mining the 4-8-10mb blocks full of txs are shooting themselves in the foot, while we are having a tremendous edge over them with our empty blocks". What then? Start forcing miners to mine the transactions?


Asking someone to pay a fee for transacting is not killing utility. It's the intended design anyway as time progresses and rewards slow down. Fees must compensate.


You fail to grasp a very simple concept:

If you make a free, or almost free crypto, that can do tens of millions of TXs per day, what's stopping someone from abusing it and getting the network to its capacity limits, triggering a priority queue through fees?

If I can have many free txs then I can make a script and fuck the system up for peanuts. Hundreds or thousands of nodes will be paying bandwidth and storage costs for junk that took me a few seconds to generate through my script. The game theory of such a system doesn't add up.

Now, if someone finds a groundbreaking solution in scaling, and this is by some kind of open-source decentralized crypto, then, perhaps, BTC can copy that solution (if it works) and apply it to increase its own scaling potential. Open source works both ways.

A very simple or simplistic explanation:

If I want to buy something, I need to pay. That's a valid reason for making a transaction so that transaction isn't bogus.

Now, if I start sending dust between my wallets, in thousands of transactions, in a meaningless way (as far as real-life transactions go), just to generate spam, clog the network etc => that's plenty of bogus transactions right there.

I meant the seller I'm not talking about fees here.

Some miners might process junk for free* or near-zero cost. Others won't even process higher fee txs. As it stands, the answer is "it depends".

* I recently consolidated some of my dust into one address for free.

I provided an explanation, not a definition.

You can't examine people's intentions because, in a sense, that's the core of the issue here. Does the person initiating the transaction actually want to send money, or does he want to spam the blockchain? How the hell can I know that? If he uses non-dust amounts he can camouflage his spamming as seemingly "legit" txs, and they all may be between his own wallets. But if he had to pay a good fee for doing that kind of spamming, which would eventually deplete his BTC after sending them back and forth, well then he might opt out of the scheme.

But even that is not 100% accurate. A big player with deep pockets might have no issue in paying the fees + spamming / congesting the network with bogus txs. It depends on the actors involved really. Normally, a script kiddie would be different than a legitimate user in that the kiddie wouldn't want to pay for each of his 50.000 spam transactions, while the legitimate user might include a small fee to get his 1-2-5 txs included. So, in that sense, the fee could serve to differentiate between one who wants to transact for real and one who doesn't. But an evil corporate entity would be able to afford paying for the 50.000 spam transactions, or double, or tenfold, if, say, network capacity increased. So in that case, the fee would not be able to serve as a differentiating factor between the serious & legit tx and the bogus one.

The willingness to pay a fee to conduct bogus txs can be a differentiating factor. But that affects only a certain group of actors, not the whole spectrum. Still better than nothing though.

Happy new year

If BTC can't perform the role of cash due to scaling it's unlikely that cryptonote coins would become e-cash without some kind of breakthrough in scaling - as they are way worse than BTC (at least in that aspect).

Of course cryptocurrencies are emerging technologies and we have no idea how far this is going to go into the future.

A web page in 1995 was designed with considerations like "will it download fast over a 2400 bps modem?", "is this gif *really* necessary? the load times are slow", etc etc... but fast forward 20 years later we have 1080p and 4k videos / 60 fps through our browser.

Perhaps bandwidth, network speeds, processing speeds, storage, in say 10-15-20 years will be so dramatically improved that even "heavy" blockchains are quite normal for everyday use without anyone even thinking about it.

Changing a variable from 1MB to 2MB or 20MB is not "work" per se. It's a few bytes of code change.

Trying to fit more data into the same 1MB is work. Trying to offload txs until they self-cancel, so that the network can scale better is work. Just upping a number is lame.

If the xt team actually wanted to make bitcoin scale better they should more actively develop solutions that allow this to happen by increasing transactions fitted per mb and it would probably be hailed by everyone (if it's safe and doesn't break everything). Raising the variable, I mean that's stuff that an automated shitcoin generator could be programmed to do on its own. How can that even classify as some kind of serious work.

"Please tell us the name of the shitcoin you are going to make"
"Please choose a hashing algorithm"
"Please choose block times"
"Please choose max number of coins"
"Please choose initial coins per block"
"Please choose how often subsidy will be cut by 50%"
"Please choose block size limit"

Voila.

The result is that Bitcoin still does the same txs per kb as before. There is no actual improvement in scaling, more like a tradeoff where decentralization and network vulnerability to bloat attacks are tuned to "worse" so that more low-to-zero fee txs can go through.

Additionally, the underlying issues that prompted the 1MB limit have not been solved. You have a vulnerability => you issue a patch to defend against the attack vector => without resolving the issue you go ahead and bypass / remove the defense mechanism. And you do that, while blocks aren't even full and by claiming that the sky is falling and that Bitcoin must ...fork in a kind-of-power grab situation. This is lame (in terms of programming) and beyond absurd in terms of the ecosystem and broader dynamics.

I'd like to see some work on how to solve the attack vectors, how to make blockchain use more efficient, how to make the network propagate information faster - stuff like that which represent actual advances.

It has everything to do with low or zero fees.

If, say, you go from 0.5mn txs per day to 1mn txs per day and a spammer can add 0.5mn txs per day for peanuts to fill the extra capacity where does that leave you?

You'll go back to square 1 and you'll still be crying "ahhh the blocks are full, we need a new increase, my negligible fee doesn't get me confirmed in 5-10-20 confirmations and I need to pay more and more", etc etc.

But not only will you be crying for the same things, you'll now have to deal with double the bloat, more hardware requirements, higher expenses for running nodes, a more centralized network, etc etc.

How is it calculated right now?

(Btw, last block was also a 1-transaction block https://blockchain.info/block/0000000000000000011bcf42f3520787eb3172c9d3dc42b2379be12cf43f3567 )

There are two kinds of spammers:

a) A spammer with not so many resources can bloat it and clog it (whether 1mb, 2mb, 4mb etc) for peanuts if the room is plenty (thus not requiring much fees to get paid), if the fee structure is not properly designed and if the miners are processing zero to near-zero fee txs (many miners do - so eventually your spam gets included).

b) A spammer with sufficient resources, can bloat it and clog it -despite an anti-spam fee structure- as long as he is willing to pay the price. The problem with this attacker is that he would be very visible. People would know it's big governments or banks doing it. So banks or governments paying to create bogus txs would be an admission of fear and a vote of confidence for BTC (despite the disruptive effect of spamming it).


I consider the number of txs irrelevant compared to actual use.

Right now you could have, let's say hypothetically, a 0.5mn tx capacity maxed out and of them only 0.25mn could be legit and 0.25 are spam. It won't change anything if blocksizes goes to 1mn tx capacity maxed out and the ratio goes like 0.35mn legit / 0.65mn being spam. It's just cheaper spam.


If new interested parties arrive with thousands or millions of dollars and they are arguing whether they should pay a few cents in fees, I'd tell them to ...fork off and find an altcoin that promises free or very low fee txs, until that one is crowded or abused and then they discover the hard way that there is no free launch in crypto.

Any system, altcoin etc that allows cheap use (and by extension => cheap abuse) can and probably will be abused once it becomes larger. The temptation is too high for malicious attackers. In the mid-90's I knew a guy that used to mailbomb local ISPs so that their bandwidth was depleted. The local ISPs had like 64Kbps-128KBPS leased lines that they had to "spread" to 50-100 users online, connected with 14.4 to 28.8k modems. Users didn't have enough bandwidth to begin with and when the mailbombing packages started to arrive, everything went to a crawl. He was doing that for ...the lulz. The idea that he was somehow important to disrupt network service for many people just by doing something as simple as ...sending mails that were saturating the internet link of the provider was apparently exciting to him. It's my belief that if a currency is vulnerable to that kind of attacks by kids => it's not good.
 
To return to the issue at hand, being in BTC allows one to participate in a decentralized system where the government won't just come in and tell you you can't transact due to "capital controls", or that your balance is confiscated. Your balance won't become zero because the bank made some poor choices and you paid for it. You also get a type of money with very specific inflation parameters, unlike fiat. Now all these require of you a small technical knowhow and paying some small fee for your txs because the network -at this point in time- won't scale to VISA-like or paypal-like numbers. If one doesn't like the benefits of decentralized payment systems, decentralized "banking" and decentralized currencies due to the small fees, let them go back to fiat currencies, the big banks, western union, credit cards etc. They'll love the inflation, the fees there, the ability of the government to control your life etc etc.

If you don't get the advantages of crypto => you can bail.
If you do get them => you don't mind paying a small tx fee. It's the least you can do to support the system.
If you do get them but you also don't want to pay even the small tx fee => use an altcoin until that too is abused and requires higher fees.

Yes, because it depends on the intention of the user. The intention can be discerned in some scenarios.

Script kiddie vs normal user => script kiddie won't like to pay fees for attacking the network while normal user will pay a small fee for his 1-2-5 txs. Thus script kiddie issuing thousands of transactions and wanting to attack for peanuts stands out because he is not willing to commit with a fee for his txs to go through.


There are two issues.

- the bloat vector
- the "congestion" vector

The congestion vector doesn't bother me. We've seen it work and it's lame. Anyone who wants to transact normally simply pays a normal fee and bypasses the queue of bogus transactions. This vector is always open whether in a 1MB, 2MB, 8MB scenario but it's not a game breaker.

The bloat imprint left by stress/spam attacks is another issue altogether because it affects the network for eternity. Letting an attacker get away with it for cheap/free shouldn't be an option.


You keep it there, until you raise it. It's not intended to be 1MB forevah. That doesn't scale, that wasn't what satoshi wanted, that's not what miners or devs want. As actual use increases, we'll see block size increases and other developments as well. And as hardware and network capabilities increase => blocksize increases can become more generous to take advantage of these capabilities.


If those "many cryptos" you mention can have 10.000 people running full nodes in their bedrooms / home connections and BTC has 100 full nodes running in data centers requiring multiple raid arrays to even store the blockchain with users only being able to use light clients, there'll be a serious difference in the quality of centralization offered.

Bloating it to infinity for peanuts (that harms scaling) = problem
Centralizing it = problem
Leaving it open for abuse and other attack vectors = problem
Going against the economic model where subsidy reduction is compensated by increased tx fees = problem

Besides, all the other cryptos have the same underlying use & abuse problem, to one degree or the other, unless they raise fees.


Neither I'm advocating not increasing the maxblocksize. I'm in favor of a blocksize increase as long as people pay fees. I don't like the blockchain being used as a dumpster. That's all.

If you increase the blocksize and provide ample space before there is actual demand, at that point you are essentially allowing people to transact (or spam) for near zero cost - if the miners don't move and cut those txs off by not processing them.


The condition you describe is impossible.


If you read more carefully the altcoin would serve only to reinforce the same lesson: That, over time, as use increases => fees increase or problems start to appear due to abuse, bloating, centralization etc. There is no free launch here because the model of decentralized / p2p money is way more resource hungry compared to a hierarchical and centralized database system. Initially it can be cheap but as it goes forward it can't remain cheap.


...with higher fees  

I'm suggesting the same.

Well, development is about developing new solutions to problems. Not about arguing whether a particular variable should be set at X or Y value.

If that's "development" then 1000 versions could spring up each one having their own proposal for that particular variable (max block size). How would that improve anything? That's not development.

In the end of the day the only people making work that will actually help bitcoin scale more => are core devs.

And vaporware development "works" in the aforementioned market?

Look, I don't know how to code shit (in terms of BTC code), but I do know how to change a few variables / constants. That doesn't make me a developer or someone who can maintain my fork even if the market agrees that I found the right value for maxblocksize.

The scaling issue hides many motives and I'm not sure how deep the rabbit hole goes. I always found it suspect that some people are so hell bent on increasing block size that even if you tell them "ok, let's say we have a tech that effectively doubles the txs that can fit in a 1MB block, like segwit or something... why would you want it to go to 2MB?" and they are like "but it has to go to 2mb". Well, I call bullshit with them. That's hypocrisy. If the 1mb is an effective 2mb, then why would you need the 2 to become 4?

Why would someone, who would say yes if you asked them about a 2mb upgrade, be dissatisfied by a technological equivalent of a 2mb upgrade in terms of tx/s? What's going on here?

Anyway, we need more people who actually code stuff that reduce the kbytes used per block, improve network transmission speeds, reduce cpu cycles needed for processing etc, and do that while maintaining the integrity of the system. Not people tinkering with an existing variable that has known tradeoffs if you set it lower or higher.

Yes, that's why I'm phrasing it more like a hypothetical 2x - because it's not 2x in practice. In essence, a 2MB with segwit is actually >3MB without - from the numbers they are giving.


At most a few dust and spam txs will be prevented. The money transacted will continue to increase, even with a set limit in tx/s. Instead of getting, say, 300k txs per day with 1$ each, you'll get 300k txs with 10$ each. The USD-volume will multiply, because that type of scaling in value is not dependent on the number of transactions. It is inevitable that costly transactions will consolidate the market to higher value transfers.

End of year metrics can be like "Bitcoin payments accounted for 10bn in 201x and 100bn USD the next year, rivaling other payment solutions such as ......".

But of course the tx/s will go up too. I'm just giving an example here.

Bitcoin-qt is intended to be used as a desktop wallet otherwise there would be no gui or wallet functionality.

"This project began as the work of Marshall Long, Olivier Janssens, Ahmed Bodiwala, Jonathan Toomim, Michael Toomim, and Gavin Andresen, but we hope it includes you too, soon."

And what exactly are they endorsing? Changing a constant to 2MB?

The only people who can seriously do development and maintenance work are core devs. Not bitpay, or coinbase, or the miners. Anyone can set the constant to whatever value and say "this is bitcoin xt, unlimited, classic" etc.

Well, I don't see many others doing scaling work. Tampering the constant isn't improving the scaling fundamentals. This is a power grab by questionable people.


Bitcoin mining is more like a cartel rather than a free market. When 4-5 people have supermajority, it's an issue.

Too much blame for my preferences... It's not like altcoins have solved scaling or the attack vectors related to spamming (except by raising fees - which is the way for BTC too).

In the end of the day there is an equilibrium between the available transaction space, the fees paid, the abuse the network gets and the willingness of miners to mine transactions. And this equilibrium will not get any better (in favor of scaling) if either

a) the software itself doesn't gets better in terms of using storage, processing and network resources
b) the resources themselves aren't upgraded to cope, as technology improves

Are we?

https://blockchain.info/charts/avg-block-size?timespan=30days&showDataPoints=false&daysAverageString=7&show_header=true&scale=0&address=

Avg size is between 0.5mb and 0.7mb the last few days. Which means there is an extra 40% to 100% available capacity, depending the day.

Yes, it is perfectly ok if I don't pay fees.

Not all txs have the same urgency. Consolidating dust in my wallets is not the same as wanting to be included in the first block because I want to transfer money to an exchange *right now*. I can wait 10 blocks or 100 blocks for the dust, but I'll pay extra for the first block inclusion if I need it.


It's just like the highway. You pay more for your own car, you go faster than the bus. You pay a cab, you go faster than the bus. If you want to go "economy", you keep your money and take the bus.


Yes, because fees are too low for some miners to even bother. When you get 25 btc from block reward and 0.2-0.4 from tx fees, why would I even risk orphaning the block by taking longer to transmit my block finding? It's not worth it.

This is a problem that sooner or later will be understood by "large blockers" when the percentage of the miners not bothering to even mine transactions will increase dramatically. So when half the miners will mine the 2mb blocks, and it's an effective network capacity of 1mb, what then? We'll be asking for 10mb blocks? And what will change then, if miners still refuse to mine txs without the fees going up significantly?


At 0.5 - 0.7mb avg, we have plenty of space left. Obviously if some miners feel they don't want to mine almost free txs, that's not a capacity problem, but a broken-fee-model, in terms of the "customers" who want to transact for free or almost free, and some miners are like "yeah, ok, please go somewhere else for your free or cheap tx processing".

Will it?

How about forking Bitcoin then?

Who is to say some Bitcoin devs won't fork bitcoin because they disagree on whether miners should allow free blocks or be forced to mine them, "as it was intended to".

Some will say "bitcoin miners are supposed to mine transactions / bitcoin will die if nobody mines txs / we can't pay ridiculous money to the mining cartel" and some will say "they should be free to choose / the market has to provide incentives to the miners (fees) in order to mine the txs".

Some miners who feel they can cope with the upgrade will be in favor - because that will put into a disadvantage their opponent miners, and some who have smaller "pipes" or worse propagation will probably reject it.

And there you have "fork wars episode #1337"

Once you start eroding trust in the system that's what you get. From that perspective, Gavin and Hearn will be successful into destroying the robustness of the system and putting uncertainty into it with the xt and classic bullshit. All you need to do is apply some social engineering pressure to the ignorant masses (who cannot see all the factors involved in choices like these, because these choices are dependent on a whole sort of parameters that the outsider does not have the knowledge to properly evaluate) and break the system through the pressure involved.

Bitcoin is under a social engineering "attack" right now, testing whether a power grab is possible through a pretentious technical dilemma that wasn't.

The increase in tx capacity is a given and would be implemented anyway and it is definitely, as evidenced by the numbers, not a pressing issue to increase capacity by 4x or 8x (2mb / 4mb blocks) when avg block size for the last two weeks is a little higher than 0.5mb. The only question is whether that upgrade would be in a few weeks or months.

Probably wallet related, I guess. It needs a setting between normal and priority I guess. If it has a manual setting, try something in between the two prices.


It would, if adding blocks was without cpu and network costs for the miner. But it has a cost in the form of orphan risk when blocks are too large which will make it a rational decision for him to reject processing transactions.

This can only be solved technically by improving the code to scale better in terms of cpu and network. Changing a setting from 1mb to 2mb or 10mb in the code, won't fix that fundamental scaling issue.


More like incorrect fee, for the given load, problem... When someone released a lot of private keys with a few satoshis in them, the network was definitely at its max, but I could transact normally if I paid a normal fee. All that congestion was bullshit almost-free traffic that was easily bypassed by a fee.

No we are supposed to hard fork it, just because

You could "sell" a fork attempt not by saying that you have to force miner fees. It's more "eloquent" to proclaim "doom" by all those bad miners who do not mine txs and how this deviates from the vision of Satoshi, who intended blocks with transactions - not series of empty blocks and a full mempool where transactions are stuck. See how better that sounds?

That's the second time he ragequited after saying he had enough and will work for the banks

I guess the powers that be needed him to re-quit in order to use the article that he wrote and spread it now that the other markets are failing... "See bitcoin has failed too"...says an ex-bitcoin dev, type of narrative. Cheap tricks that work.

Fuckin' smallblocker Satoshi who didn't realize that dust/spam payments aren't practical...




Blocks are full with spam/dust => "oh no the end of the world is coming", yet the predicted design to bump fees and bypass the spam is working as it should (with less fees - as value per BTC has increased).

All the arguments about the good anti-core forkers who want the best for the small guy so that he can make micropayments for free / almost free against the "evil blockstream employees" seem to go out the window in light of what Satoshi himself said about the design.

It seems Satoshi was of the belief that eventually technological resources will be boosted to a level that the existing design can scale even for micropayments, when currently it can't. What he expected is 100% probable (give it a few decades at most and VISA-like tx capability will be easy), however I suspect he was expecting some kind of non-linear breakthrough sometime soon - that hasn't yet been invented (?) or mass implemented as of today.

He was also of the opinion that there is no need for the blockchain to be bloated and his preference was to keep it relatively small, in order to boost adoption and prevent centralization. He offered an alternative "design" where a much more centralized bitcoin with nodes in server farms could take over and people would be running light clients.

People just repeating "big blocks" remind me of the movie Idiocracy with the "electrolytes".

+ the fact that there is no expansion space is a bullshit argument. Blocks are at ~600kb (including dust and spam), not 1mb. It has +50% capacity to reach 900kb - with 100kb to spare. If some blocks are full, so be it...

+ there are two dimensions in growth, one being the money volume the other being tx count. Money volume will continue to increase and scale even with a steady tx count as very low value txs give their place to higher value txs in a "crowded" scenario.

In the finance world if you say "my company transacted 1bn USD last year and 5bn USD this year and I'm expecting 20bn USD in 2 years", that kind'a counts for growth you know. Just sayin'.

The concept is that you are dropping 5000 satoshi transactions for 50.000 or 500.000 satoshi or 5m satoshi txs - for as long as the network can't handle every one of them (there will be a day when that becomes a reality).

Check this guy out: https://bitcointalk.org/index.php?topic=1329174.0

"Oh and I don't want to pay fees"

Growth of micropayments was not on the table, per Satoshi himself. They don't scale with the existing tech. He was hoping for technology to solve this issue - and so far this hasn't been the case. It may be solved in 10-20 years, right now it isn't.


There will be two coins of 21mn supply after the fork. The money supply will be doubled. Some that prefer the 25% variant will be dumping on the 75ers. The opposite may not even work due to lack of exchange support, lol.

And that's the least of our worries. If there is even a 10% chance that Satoshi actually wrote the letter back in August against XT and Gavin, what follows a successful fork may be Satoshi coming out and saying "ok, NOW it's an official failure". Hearn's bullshit will not be even 1% in magnitude compared to Satoshi declaring it dead because BTC became Gavincoin.


There is a serious risk that the post of Satoshi against XT fork is real. In that case, if the "classic" fork succeeds, what Hearn says about bitcoin dying will be ...nothing compared to a Satoshi declaration of BTC failure.


Do you feel lucky?

I don't.

There has been a social engineering attack and it has been successful.

If btc turns to gavincoin / nsacoin under the pretext of "larger blocks urgency" =>  it's dead (per Satoshi). And we may have a public obituary for it by fuckin' Satoshi.
if core folds and goes to 2mb or segwit right now => it's theoretically better than turning btc into gavincoin but it's still a social engineering attack success, in terms of pushing things and breaking consensus under the threat of a hard fork.

The parameter that "btc fails because there is no space" is for technically ignorant people. At most some dust will transact with a lower priority due to zero or low fees.

What did you expect to read? Maths and crypto, for things related to social engineering, populist methods, consensus and forks?

There is no saving here. If he is truly Satoshi, then when Satoshi comes back after a fork it will be to declare the project dead.

Whether you hold core-coins or gavin-coins, you are fucked in that scenario.

When there is a technical issue at hand, not a social one.

There is no salvation on the menu.

It's the fullblockalypse, the forkageddon and the second coming of satoshi combined. Let's fork bitcoin to "save it from failure" in order to trigger the event where he would be forced to officially declare it a failure - if it's him of course. That will work really well for everyone, forkers and non-forkers alike 

Satoshi contradicted himself on micropayments and scaling as well. Initially he was more bullish in terms of what Bitcoin could do but then became more realistic given the hardware/network constraints and network abuse that required more fees and block size limits. So depending the time-space coordinates you could take contradictory quotes even on the same issue.

He kind of postponed his bullishness for a time when tech would allow more.

Satoshi's writing and that particular letter have something in common: Two spaces after a sentence ends. That's the "old" way of writing in the typewriter era where you hit space twice - and you carry over that habit to the PC keyb into the late 80s/90s. You do it too because you are of the "old guard". Younger people, hackers, script-kiddies, well... not only don't they know these things but they won't even spot the difference in order to emulate it. The two spaces, for me, increases the chance that it was original. As for IPs, mail spoofs, hacked accounts, I can't tell you who controls what. The writing style is quite neutral and it feels ok'ish though and in line with what Satoshi has said in the past.

As for blockstream people doing it, you are saying that they hacked Satoshi accounts back when it happened and then they used them when convenient to promote their agenda? And how would they know that Satoshi wouldn't pull the curtain on them? Especially after Satoshi came out and said he is not Dorian? It's a very long leap.

There was no push for anything, more like "inertia" during the prolonged discussions to find consensus.


Am I? What do you read below? That Satoshi considered it a problem if every micropayment didn't fit in for free/near zero costs? That every micropayment would definitely have to be included in - and do so in 1 block?

That's not what I'm reading:

I don't see it as emotional. (I mean overemotional / hysterical). Strong worded, yes.


Hm...


I find that hard to believe. I mean if he is serious about the "power to the people" concept why would he abandon it? It may seem that way but I'm sure he's following it.


If he felt that this (social engineering + coup) genuinely endangers the project, more than any technical issue, to the point where he'd have to declare the project dead if it succeeded, it's not very unbelievable.

It's ironic that you could write good code and still have humans be the weakest component of the system.


Not only that, but if you notice that particular post with Wright, he had just one space between the two sentences. Yet Satoshi was apparently double-spacing even one-liners:

The problem is that the anti-fork message was not spoofed and the writing style matches.
http://pastebin.com/Ct5M8fa2



The "we are all satoshi" was spoofed and the writing style or expressions didn't match. So the second doesn't invalidate the first.

Additionally, that particular email address is not known to have been stolen.

Therefore the August message could be legit - it's a very serious risk for BTC. Risk, in the sense that if the proposed fork goes ahead, we'll have Satoshi's second coming after the forkageddon to proclaim Bitcoin is a failure since it failed to protect itself from this kind of attack.

XT fork news and classic fork news have both sent price lower. The markets were going pretty well despite the "fullblockalypse" bullshit. 200->300->400->450 - even 500+ for a while. For the most part, everyone had priced in that an upgrade will be implemented at some point and all will be well. The moon was the limit. The core roadmap was in the same line.

-Violent hard forks with low consensus that will split the currency / double the monetary supply / create distrust for the future of the currency for possible future forking events
-governance coups,
-dividing the community and throwing around "bitcoin is dead" to the mainstream media

...are not by any means "market-friendly".

Plus driving out the bulk of current developers, who are actually developing solutions, and pretending to be the ultra-dev for changing a 1MB constant to 2MB, and leaving bitcoin development AND MAINTENANCE, orphan for the future, is not "bullish" by any standard.

And if Satoshi's warning is true that in case of a successful fork he'll be forced to declare Bitcoin a failure (I would probably disassociate my name as well after a hostile takeover and admit defeat) then we have a real problem ahead of us.

No, the "classic" people do not understand markets, unless their purpose is to destroy bitcoin - in which case they understand markets pretty well.

You are stating assumptions as facts and assumption is the mother of all fuckups. You do not know whether it is fake or real and therefore ignore serious risks involved.


That's more about the technicalities of a normal fork-split situation rather than a social-engineered takeover attempt.


You can summarize it as follows: I believe the future of bitcoin is in better hands with the core devs. They've done a good job over the years and the alternative is not attractive.

There is nothing that makes me believe that "classic" is better in any way than core.

Classic lacks manpower and proven ability to maintain and evolve bitcoin, plus their motives and strategies are suspect because they are not based on technically sound arguments. Additionally they are not presenting any scaling solution (unlike the core people), rather they are just tampering a constant with known restrictions and compromises which gets us nowhere in the long run. Plus they are ruthless in the way they are trying their power grab, even by destroying confidence and creating two separate currencies - which, as a precedent, is dangerous for any future point of disagreement. It's a power grab, camouflaged as a block size upgrade under a false pretext of urgency.

I don't like any of this shit and I don't trust them at all.

If you don't like how bitcoin is you create an altcoin. There is no dictatorship involved. You can change from a single parameter to every parameter.

If you want to change bitcoin itself there is the strong possibility that other developers might disagree if you propose something that is not optimal. Since you can't have multiple implementations for every single point of disagreement (multiple forks/currencies as a result / corrosive to trust in the currency) it is logical to first find a consensus. Is that a "dictatorship"?

In that sense, yes. But that doesn't mean just because you are a mining majority that you are the "right" coin. For example if hackers get control of two mining pools with 60% mining power and start mining blocks with million new coins out of thin air, people, exchanges, miners etc, can select the old chain - and for all intents and purposes it will be considered the legitimate chain and not the "altcoin".

Satoshi said the system was not suitable for micropayments. He said it would probably not be suitable for <0.01 txs. He considered spam a problem and he said he is taking intentional measures to restrict very small transactions.

The value of the network will not increase if the blockchain is 100 terabytes full of junk, requiring gbps to move around junk. But it will increase if it is efficient in its hardware and network resources even if that means restricting dust - as it was intended to. Not by me, not by "blockstream", but by satoshi himself.

You use the banks, paypal, credit cards etc, don't you?

As a user you want ZERO fees.

They don't give it to you. They charge you. Some times a lot.

Are these organizations dying from not meeting user demands? Did their network effect got negatively affected and thus never became widespread? If no, why?

The reason is because there was no alternative. So, your economic idealism about market demands by users etc etc hits the wall of economic realities.

Bitcoin is the first thing that comes close to challenging them on multiple fronts. Yet, it too, has some limitations due to technology. These may not be true in 5-10-20 years, but right now they are. So... with this as a given, you can still position bitcoin in the market segment where it is way more profitable to transact with it than the banks, paypal, credit cards etc.

For example paypal says if you receive money, I take 0.35$ and something between 1.5 and 3.5% in fees - or something to that effect. So if I lose 4$ in a 100$ payment, of course it would be better for me to choose BTC for that 100$ payment and keep like 3.5$.

The prices, fees and disadvantages of my competitors (reversible txs, having my own money or "freezing them") etc etc are what ensure that I go upwards in the free market that you mention because I'm better than them.

I do the transaction faster, cheaper and in a non-reversible manner (after 1conf). It's not whether I allow spam/dust txs or not. If your fees are like <0.5$, then you are already beating most banks, credit cards and online payment systems - which automatically means that you have the competitive advantage and you'll increase your marketshare. As you do that, you increase your tx capacity to accommodate, but not giving away space for free to abuse because that acts in a self-defeating way for the functionality of the network. P2P networks are inefficient. Hierarchical databases / centralized databases are orders of magnitude more efficient. So when you try to scale P2P networks the inefficiency kind of multiplies and you need to be careful, in the technical sense.

As for waste, spam, elitism etc, just read the quotes of satoshi in my post above. Was he an elitist or a realist - in terms of how the network operates?

It's not the micropayment word that I put the quotes up. And they are not random.

Poster above wrote:

"I do not understand how "smallblockers" or elitist..."

"There are no all knowing wise guys, who tell the peasants what is good for them (and that his tx is "spam". Such arrogant elitism!)..."

Satoshi wrote:

"The dust spam limit is a first try at intentionally trying to prevent overly small micropayments like that."
"If we started getting DoS attacked with loads of wasted transactions back and forth"

...people have problem when I say "dust", "spam", "waste" and they are like "who are you to determine what is spam, dust and waste". Some others say "arrogance, elitism" etc. Yet satoshi was using similar words in dealing with the real life problem of network abuse. Why would he intentionally prevent small transactions if he thought they weren't a problem - at least for now?

As for your argument regarding fees and block size, I've said multiple times that I wouldn't object much larger blocks if there were much higher fees involved. In absence of serious antispam fees, the block size is the last line of defense. Additionally, oversupply of space will not give much motivation for those transacting to pay fees. So block size and fees paid by a spammer are related (again, in absence of serious anti-spam fees).

On the other hand, this could be "solved" if miners went on a "strike" and didn't process transactions if they were paid some serious tx fees - which would lead to a user revolt or some kind of "intervention" by devs who would then try to "force" the mining of transactions. At least for the next 4 or 8 years when block subsidy will probably be much bigger than the fee market.

If you click the link, you'll see the discussion was from a question of a member about what does the 0.01 btc fee solve in terms of antispamming and how this would prevent microtransactions etc, and satoshi explains that it is intentionally limiting them.

=>


In any case, I wouldn't take it as a fixed value. I mean if BTC goes to 10.000 dollars, 0.01 BTC is meaningless as a limit (it's 100$).


See? It works as Satoshi said

There is no flaw in the argument. As a consumer you want to pay the least possible money, and that is zero. A cash tx is zero. My post office, for example, says for credit card you'll be charged +0.35 euro. So cash it is then. Why pay extra 0.35? Fuck them.

But even if we are talking non-zero you always want to pay the least possible. So why is it such a problem if paypal, banks, cc's ask you a ton of money and miners ask you a fraction of it for processing your tx? They are still the cheapest option available and doing it while dealing with the inefficiency of a p2p system. Why are you proclaiming that the system violates user demands etc etc? It doesn't make any sense for me. I mean, if we can live with banks, ccs, paypals etc and bitcoin has a fractional cost of them, why are we so hypocritical and vent against bitcoin fees - when everyone else is sucking us dry?


Why would I take on the cost of maintaining a large data center when others can do it? Does it make economic sense for me?

In any case, if Bitcoin reaches the point where it will be hosted in 30-50-100 data centers worldwide, a few co-ordinated government raids and a DDOS on the rest, will shut it down. If we want such a vulnerable system that can be shut down like the piratebays etc, then we are idiots - we have no clue what the system was in the first place and how it should be operated. Some think centralization and decentralization as totally abstract concepts, but they are not. They have very real life consequences in how BTC can be shut down. If the average guy can host a node in his bedroom with his vdsl or fiber (adsl will probably be obsolete due to problematic upstream), that's helping A LOT because shutting down multiple thousand nodes is more difficult, although it is doable with other methods like filtering the traffic by controlling the ISPs and global backbones. But that's a card that they will burn only if they need to.


Nobody says it has to be stagnant - on the contrary. The system has to expand to meet capacity demands, but you have to be realistic on what demands you will serve due to technological constraints. The desire to have everything right now is normal, but to be realistic some time must pass in terms of technological progression - or software hacks.

This could be a nice meme though... split screen shows a guy with a happy face and has a caption like "Doesn't complain for paying XXX in bank fees per month", the other side shows him using btc and yelling at the screen with a caption like "Gets furious at 'smallblockers' due to paying 0.16$ fee for a BTC tx".

Something like that...

The hypocrisy, some times, is mind-blowing. And I'm not talking about specific users, you, or someone else - I mean generally.

I don't think he meant what you think he meant. Otherwise bitcoin would have no issue right now with, say, 20mb or 100mb blocks. But it does. They won't work in real life. Unless of course you put Bitcoin in 5-10 data centers and then, yes, it'd work. Until the gov comes down and raids the data centers. That would be "awesome"...


Say we don't have fees.

What's stopping me from instering 500 Terabytes of spam for the lolz into the blockchain. Would everyone have to pay the cost of my spamming?

Everyone can have a p2p client that deals with 10kb/sec, has 100 mb storage requirements, needs 1 small cpu and 256mb ram. As you go up and up in hw requirements, cost goes up, "volunteers" go down - even if userbase goes up. As you hit datacenter level requirements the number of "volunteers" starts dropping significantly because costs start running in the 5 digit, then 6 digit category and eventually you'll be paying millions.

The point was that you simply pay the fee and skip the flood attack. Obviously if the flooders are paying fees to get accepted in the mempool due to the current or future antispam limit (as low or high it may be), you have to pay more than them to get ahead.

No incentives. Yet if you look at an altcoin (dash), its masternode network has around 4000 nodes due to getting part of the block subsidy.


If the data and network requirements keep exploding, and network/storage/cpu capabilities are at the same progression rate, costs will be similar or higher.

Now, if there is a breakthrough in technology or in BTC scaling efficiency, that would be another issue altogether.


Personally I expect that subsidy reduction will mostly be covered by price increase in BTC.

Mining 50 BTC that cost 10$ gets you 500$.
Mining 25 BTC that cost 500$ gets you 10.000$ (do you mind that you are now getting 12.500 vs 500 per block? No. I thought so)
Mining 12.5 BTC that cost 6.000$, gets you 75.000$

...the only question will be what it costs for the miner (in terms of capex + opex) to get the block reward, due to diff increases and mining competition which will, in turn, eat the theoretical profit of a higher btc price.

As far as fees are concerned, we'll see how it goes. We are somewhat far from the point of replacing the subsidy and by that time a lot will have changed, both in blocksize and scaling solutions.

+


The division and fees you mention imply 1mb limit forevah, or same tx/s capacity forevah, but this is not anyone's plan as far as I know. So, naturally, fees will be much lower. And if we get a technological breakthrough that allows much better scaling, they will probably drop like a stone.

Wait, what?

Core is simultaneously accused that they want "higher fees" or "fee competition" and now accused for "wanting to massively reduce fees with lightning".

Please decide what core wants.

Well, I'm not debating core devs here, rather their "attackers".

All this time I was hearing "ohhh core people are bad, they want to price squeeze out the small guy", then I see someone saying to a chinese miner that classic is good for them because lightning will reduce their mining fees in the long run - or something to that effect, and now you saying "ohhh fees will go down" etc.

It seems that people will go to any stretch just to attack core devs. Even when their attackers have flaws in their reasoning because they are attacking both directions (low & high fees), it's still core devs fault for not understanding economics

Now you care about miner compensation and network security? Weren't you the one complaining that you don't want to pay fees because you've bought the right to transact when you bought your coins, etc etc?

High fees = "fuck core devs"
Low fees = "fuck core devs"

For real?

https://blockchain.info/charts/avg-block-size?timespan=30days&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address=

Avg seems to be at around 0.63 - 0.65mb right now.

This means the protocol can accommodate an increase of an extra 53-58% in txs (and that includes dust and spam txs like the ones we have now).

The real question is why miners aren't mining these transactions to get to the limit. Why are they issuing empty blocks, why don't they even care to change the 750kb parameter to 1mb etc etc. The obvious answer is because the fee incentives are too low, so why should they?

So, one could argue that while the free market partially works regarding miners and transaction mining (some miners don't care to mine everything), an increase in block size is in effect a valve-relief / bypass of the free market.

1.The protocol allows 1mb
2. Miners mine up to 0.65mb because some don't feel incentivized enough and want to mine empty or 750kb blocks - so due to the lack of fee incentives, the extra 53-58% capacity is unrealized
3. The solution would be a free market one (people pay more fees / miners start mining transactions until we reach 950-980kb on avg), instead some developers create a free market bypass-valve, increasing block size to 3x our current level of txs.

I wonder how much this rationale can "scale" if miners start rejecting more and more transactions for mining due to low tx fees. Can the solution be "ah yeah, fuck the 90% of the network that doesn't even mine, we'll simply raise the block size for the rest of the 10% of the miners who actually mines transactions"? I guess we'll find out.

On the other hand, if, say, Chinese miners have an extra incentive to mine large blocks because they have like 60-70% hashrates and the slow propagation to the rest of the world would put them into a superior position, they might even have an incentive to mine all kind of junk for free and then emit full blocks which get insta-verified through the Chinese "intranet" but make all other irrelevant because they are too slow to catch up. Thus you get a bloating incentive

I've read a counterargument, like the one Hearn says, about China not wanting big blocks due to the great firewall etc - but most of them more or less signed up for classic, didn't they? So I guess if they are confident due to their supermajority and that intra-Chinese propagation will be a peace of cake, then why worry about block sizes? It's the rest of the world that would have to worry about them. And I'm not sure I even understand 5% of the depth of the problem in all its angles and dimensions.

My postal service has at least 3 different speeds. A priority, B priority and express. And I can also use private courier for even faster. So 4 types of fees for 4 different delivery speeds.

If I don't care about the speed, I'll go second priority. If I do, I'll pay the premium. It's that simple.

There's no entitlement that I can produce all kind of spam and they have to be included in one or a few blocks (for peanuts).

You pay the fee, you are in. In a timely manner.

Now you are arguing that the market is broken because you can never be in the top 1500+ bidders (1500+ txs that go through)?

That's impossible.


It would depend on what others are paying at a certain time. It's not fixed in time. That much is obvious.

With blocks getting issued in either one minute or 30 minutes, your main problem is confirmation time, not fees.

If you can do it with 0-conf, obviously fees are not an issue. You are confirmed even if the transactions goes in 10 blocks.

But 0-conf is ...well... double-spendable.


It's a paradox only because you mentally choose the losing side. You could make an equally valid paradox saying you will always beat the "loser" by paying 5.02 as he would always pay 5.01 or less and thus be left out due to space scarcity... lol?


Parcel delivery services overcharge you to avoid dynamic charge.

If they feel, for example, that their cost is 1.3$ to 4.5$ depending the workload, destination, economy of scales during certain circumstances of mass deliveries etc etc, they may charge you 5$ "just in case", so that they always make profit.

Bitcoin is far more efficient and that's not a problem, it's a feature in the sense that you don't need to pay more than you have to.

So, for example, if first-block inclusion fees fluctuate between, say, 10 cents and 30 cents, yes of course you could be paying a "fixed" dollar to be always in and I could give you an answer like that, but you would be overpaying by doing that. If you pay 31cents though you'll be relatively assured of inclusion (unless you hit a miner where he is not even interested in your peanuts compared to the block subsidy and mines 0-txs). Still you might be overpaying a bit compared to a riskier 20 cents.

Actually there is a market gap here for some kind of website / service that monitors broacasts, sees when txs are included and finds out precisely what the cut-off for first block inclusion is by seeing which went through and which didn't in prior blocks (provided prior blocks actually mined txs and were not 0-tx blocks). I feel that bitcoin-qt's estimations could be improved and from what I read, the same goes for light clients.


It is genius but it can't cover everything. It didn't forsee the aggressive takeover through a developers schism which wants to fork the currency and create a precedent of the currency splitting again and again in the future because devs disagree and promote division.

Money can't be forked / have the supply diluted / create 2 parallel currencies of believers in BTC and believers in BTCC - and then in every critical junction have this happen again and again. This is bullshit. The human component vulnerabilities were underestimated and I feel Satoshi's warning back in August might be true: If the fork succeeds he will be forced to officially declare it a failure.

From what I'm seeing in the poll: https://bitcointalk.org/index.php?topic=1331385.0

...it's up to 77.2% for "no" and "probably no". Now, that's way too low for my risk-aversion preferences... I don't know if I can "afford" a 23% uncertainty or risk (going by the wisdom of the crowd). According to my assessment the risk is actually higher because the substance is solid.

The thing is, every democratic process can be used to create rifts.

Let's say you have a community and then you have 10 issues to solve.

You start with 100 people who vote 50-50 in every single issue.

After the first round / first issue, and if it involves "heated" debates people have split in 50-50 and may have hostilities between them, like we do right now with "core / classic".

Then in the second issue, let's say the 50% who thought they were "friends" because they sided on the same side of round 1, may be in opposite sides in issue number 2. For example say after a classic fork some disagree about where classic should be going and create a new fork.

So community is now divided in 4 parts

-25% voted yes in issue 1 / voted yes in issue 2
-25% voted yes in issue 1 / voted no in issue 2
-25% voted no in issue 2 / voted yes in issue 2
-25% voted no in issue 1 / voted no in issue 2

In the third voting about a third issue, the community will have split in 16 parts.

That is problematic and can never be applied to currencies.

If it does, the currency is useless - at least as store of value which requires confidence. The assumption that most people will side with the miners even if they disagree may hold some truth, but even so if you lose even 10% in each round that sticks with an old fork for ideological reasons, then you have created 16 currencies over the first fork and 2 consequent decisions in each fork - while losing a good chunk of people in the process and preventing a whole lot of others from coming onboard due to the constant "cell division" in each "democratic rift" or "free market choice" or whatever term one may use. It's a weird mechanism.

It's a united we stand / divided we fall situation.

The "problem" here is we have 53-58% more taxis available than actual demand (1mb blocks vs 620-650kb avg use)

1-block inclusion for every single transaction that isn't mid-to-high priority is the only way this could work out.

There is no way that a spammer can activate a bot, generate 100mb of txs in a few minutes and then expect to be served in 1 block, whether that block is 1, 2, or 20mbyte. If you have a situation like that, with spikes, it doesn't prove that you need ...bigger blocks. The fees will take care of how txs will even out and get processed.

I was saying upthread there is a market-gap in terms of a website that analyzes and suggests fees, lol... Cointape does that, apparently: http://www.cointape.com/

https://blockchain.info/charts/avg-block-size?showDataPoints=true&timespan=30days&daysAverageString=1&scale=0&address=

0.71mb = there's an extra 40% capacity.

Ane people are still paying peanuts for the bulk of transactions (free or near free): http://www.cointape.com/

....with not much "urgency" in their tx confirmation - otherwise they'd bump their fees up by a few satoshis.

On the other hand those that pay more normal fees, get included in 0-1 blocks.

The future is kind-of-accounted for (considering the problems of BTC in scaling, which are much deeper with current technology than a change in block size) through

a) devs working on scaling
b) fees that will eliminate a lot of dust/spam that are now processed when they shouldn't

Blocks getting full is a meaningless factoid without seeing the quality of transactions and fees involved. We could have 2 mb blocks tomorrow morning and someone could activate a script and fill them up for peanuts. He wouldn't be in any hurry of course for inclusion, so he'd pay the absolute minimum he could get away with. After all even if 500kb legit transactions are ahead of him and he takes the last 1.5mb of the block with zero/near zero fees, the effect for an outsider would be that "...oh my gawd blocks are full - even after we went from 1mb to 2mb... Oh shit we need 4mb!!!"

If you see threads back in 2013, you'll see they anticipated that given the size used they were expecting a problem in 2014 or so and some were like, bullshit, it's just a lot of spam by satoshi dice and similar stuff. Those who went with just the quantity of data failed to predict that we'd be still running in 2016 with 40-50% capacity to spare, those who examined the quality of data knew there was nothing to worry about. That's not to say that an increase is not needed. Of course it is. Multiple increases will be needed. But nothing will happen even if blocks are full 100% of the time with junk. We've seen emulation runs with the various "stress tests". All normal txs went through with a fee, spam stayed in the queue. The fullblockalypse that never was.

Yep, I can take no credit for that

But devs aren't waiting, they are coding solutions or half-measures / band-aids.


What we need is a tx/s capacity increase plus entering a more grown-up phase where the network stops processing spam and junk and stops acting as a third-party storage database for near zero or zero cost.

Practically all developers agree to it, whether it is in 3 months, 5 months, 1 year, it'll happen and we'll be ok.

Hard forking a currency into 2 currencies with the "orthodox" and the "catholics" each supporting their own part of the schism? No, that's the stuff with which nightmares are made of. Gavin, Hearn and all who sided with them are extremely dangerous to bitcoin, either because they lack the awareness of what they are trying to do, or because they are intentionally doing what they are trying to do and camouflaging it with the pretext of "saving" bitcoin in a situation where it doesn't need saving. At most a few fees will be bumped and some dust/spam will be crowded out if core devs are slow in their own rollout. That's all that will happen when blocks get full. It will not harm the "network effect" of normal users. But a fork will definitely destroy confidence in bitcoin forever because it sets the precedent where for each consequent "disagreement" we can have a new schism. Do you think that's good news for a 20-year horizon investment?

Just think it through. Is the precedent of a violent hard fork (and the knowledge that at any time the currency can split into two currencies / diluting the money supply / having people rage dumping on the "opponent" fork which they don't believe into etc etc) more beneficial than a few months delay in a more proper transaction capacity increase - when the issue isn't even pressing? Can the answer ever be yes to that?

He states the obvious.

If BTCs were endless why would anyone pay 400$ for them?

Likewise, if blockchain use was infinite in terms of transaction capacity & storage, why would anyone pay fees?

You don't pay for things that are provided in abundance.

If the system is designed in a "go-ahead-use-as-much-space-as-you-want-for-free" the lack of scarcity would lead to few incentives for those using the space to pay the fees.

Theoretically miners would prevent this thing. The game theory would say "but it is not in their interest to process spam, dust, zero-fee txs etc etc". In reality they do. They don't act like rational miners and the irrationality in the mining business where the miner subsidizes (!) blockchain abuse breaks the system of supply/demand in the case of larger and larger blocks.

Ok, let's say you hit the "real world constraints", what then?

Someone will come along, proclaim the new version of fullblockalypse, say the end is near because blocks are at the technological limit and we now have to make people pay fees, etc etc... then they will say they have that fantastic solution of changing the X parameter in the network (like block times issued in 20 minutes instead of 10m to allow larger blocks to get propagated without getting orphaned, or the implementation of some other "hack", to "solve" the "problem") and if we don't do that NOW, it would be a frickin' disaster.

A new rift ensues etc etc and then we have yet another currency after BTC and BTCC.

This is bullshit. It never stops.

Plus, there is an issue I thought of the other day, triggered by a discussion I was reading. In a big block scenario and if most miners are in china from what I understand -and please someone correct my misunderstanding if I'm wrong-, the problem will be that they are communicating the big blocks through their national backbones in great speed while the rest of the world is orphaned all the time because they are lagging behind them and they don't have 51% hashpower to build longer chains than the chinese.

In this sense, the chinese could actually be ...incentivized to put out as large blocks as they want to disadvantage the rest of the world - even filling blocks with junk in a prearranged manner, where they act like a cartel to push others out and get all the BTCs for themselves. If it works, why not?

I don't think there are people which are actually on a "1mb forevah" camp. This, obviously, doesn't scale. So no permasmall.


In absence of serious antispamming fees, and in the presence of "willing-to-process-junk-for-free" miners, the block size is the ultimate safeguard for abuse.

Personally I have no problem with big blocks if minimum fees get higher and if the game theory, or code, or network, doesn't break somewhere else.

Well mining does create new units, doesn't it? And instead of having +6mn coins, you then have +12mn due to parallel mining of +3600 coins on each fork.

Regarding existing holders, if you have your own keys you are relatively ok (minus the obvious destruction of USD value), but the situation with coins in online exchanges and wallets will be "problematic" if say an exchange with 500k BTCs, say 'ok my clients, now you have 500k BTCCs because we adopted this fork' (and we are keeping 500k BTCs of the other fork for ourselves). It would be like stealing BTCs and exchanging them for Gavincoins.

People need to do a bank run in every exchange (maybe even online wallets too) well before we reach the point of the hard fork, to ensure that they have control of their BTCs.

Karpeles got away with 700k BTCs and said "oops, malleability bug".

They could easily say "well... you know... hard fork... force majeure! Not our fault".

Why would anyone risk this instead of pulling their money out.

Unless exchanges commit to offering both BTC and BTCC trading, with dual wallets, dual market engines etc, any BTC coins that remain in an exchange that "shifts" to BTCC can (and probably will be) "confiscated" and users will be given only ...gavincoins / BTCCs. Exchanges will have all sort of excuses to offer about how they are not obligated to do dual wallets for every different chain other than the dominant one, etc etc. They can even cite the protocol specifications and claim that the BTCCs are actually the real bitcoins and that BTCs are just an invalid shorter chain or something - so why would they even keep track of them, etc etc.

The fork can easily be a heist tool. Don't leave any coins on pools, exchanges, etc etc before any hard fork. If you own the keys, you'll get btcs AND btccs, so you can then dump whatever you don't like. Don't let exchanges take them and dump them for THEIR profit.

Any exchange that is on the bitcoinclassic.com page, essentially has a stated intention of turning your deposited BTCs into gavincoins / BTCCs and keeping your BTCs - unless they explicitly offer both BTC and BTCC trading options.

Even if one is a BTCC supporter, he'd rather have his BTCs for dumping (or HODLing) instead of the exchange who will keep the profit of the BTC-chain.

1. There's plenty of incentive for an exchange to support btc, btcc or both - as these will have tremendous volume post fork, if the fork materializes. It will definitely be an order of magnitude greater compared to any altcoin action.

2. That's up to you. Just make sure, prior to the fork, to take custody of your coins from any exchange, pool, etc.

What news?

That part aint very reassuring though:

"We'd have to see how it goes.. maybe we would give people the option to choose their chain, or automatically put them on to one or the other if no action is taken by a certain date."

To sum it up: In the possibility of a hard fork, pull your coins way ahead of time to be sure 100%, with no "we'll see", "maybe", "or", etc. Ahead of time is crucial in case anyone is running a fractional reserve scheme and you want to avoid getting cryptsied in the process with all possible obstacles being thrown your way. That's how bank runs work. First ones get money those late at the bank get nothing.

Check http://cointape.com

Tell me those who are waiting, how much they are paying in fees.

To help you with the math: 1 satoshi = $0.0000040927

From what I see, most want to pay <30 satoshi per byte with a lot of transactions being in the <10 satoshi per byte or 0 satoshi.

Most txs right now who are waiting, are paying <0.05$ - with the bulk paying <0.02$

First block inclusion is at 0.08$ right now.

Such Fullblockalypse... Very fees... WOW

If the chinese can produce something domestically, they do.

Why "import" BTCs for dollars, from foreign miners, when they can produce them locally?

If Chinese production of BTCs can satisfy local BTC hunger (prevents USD outflows) or even be used for "export" (USD inflows), then it's a "profitable" activity for their economy.

China is intentionally low profile in terms of international "incidents". They don't want to draw too much negative attention.

Even if the western elite hate bitcoin with a passion, they will (hypocritically) crucify the chinese for such an attempt. They'll make it top news that "China is panicking and is now after Bitcoin and bitcoiners". The chinese have learned the western modus operandi, they aren't idiots. They have an attitude of "maintain a low profile and steady as she goes" particularly for things related to things which aren't exclusively domestic and/or have international reach. I feel the western elite tried to exploit them with the hearn article, by putting them on the spotlight, presenting them as some kind of "problem" so that they can then try to mitigate this "perception" and thus make them react like "we are not the problem, we'll increase blocksize" to preserve their low profile. Thus they were "played" to start getting out and supporting the "Classic" in order to ...prove that "we aren't the problem, we are easy-going miners, we only want peace and stability, all these stuff that were written about us are false"...

The western elite like to play chess and play everyone like a pawn... what is the chinese miner attribute? Low profile, we don't want any problems, we do what we do and don't really bother with anyone... so with a little bit of upsetting the status quo after the Hearn article => they are placed into the spotlight as a "problem" => this activates their instict to go back to low profile and say "yeah yeah 2mb it is, just leave us alone so we can go back to low profile mode where nobody notices us". However by doing that they are shooting themselves on the foot since forking bitcoin is destructive both for them and bitcoin.

Fork a multi-billion $$$ currency, shatter confidence in crypto, potentially even destroy lives, because some people don't like some other people - who they don't even know and just read about them in forums, reddit, mailing lists etc? I mean, wtf?

We've gone from the pretense of urgency to ...social disagreements as reasons to destroy bitcoin. Yeah, let's fuck peter todd and lukejr by forking it... that will show them (!) - along with a few million users of BTC. lol?

Is it capitalism and a "free market" when banks fail and we pay the bill? It's bullshit, that's what it is.
Is it socialism when the governing oligarchy and their circle have extensive privileges over others?

The elite don't have economic ideologies. Economy is just one very important tool, out of many tools, to exercise global control. People fight over socialism, capitalism, and other 'ism's, when there are no such systems in existence. They are all bastard systems, customized to serve other agendas.

cointape.com

Which fee should I use?

The fastest and cheapest transaction fee is currently 30 satoshis/byte, shown in green at the top.
For the median transaction size of 338 bytes, this results in a fee of 10,140 satoshis.


So first block inclusion for a normal tx is at 0.0001 right now, which is less than ...0.04$.

That's the bitcoin we have.

If miners decide to fork it, they'll have created a precedent of zero trust in future stability. Why would BTC continue its existence as a store of value when everyone knows it has and it can be forked in the future into multiple currencies?

It all comes down to miners and whether they like mining 400$ BTCs or if they'd like 100$ gavincoins - after the fork, destroying BTC and their own business as well.

Not raising the block for a little while longer, will at most prevent some spam and dust transactions and raise the fees a bit. It's 3-8 cents right now for first block inclusion while the largest portion of transactions are paying near the minimum to avoid costs and don't care for speed at all.

Forking the currency is destructive for everyone. If the miners like to wear a dynamite vest and blow everything up like suicide bombers, well, we'll have to see what happens next.

Personally I'm not discounting the possibility of satoshi returning to officially declaring it a failure and disassociating himself from the post-forking power grab.

Seems like high volume spam. Instead of spamming the blockchain with dust, now we have XXXX btc moving back and forth, for the lolz, also creating meaningless "output" spikes.

In the meantime: (cointape.com)

The fastest and cheapest transaction fee is currently 30 satoshis/byte, shown in green at the top.
For the median transaction size of 369 bytes, this results in a fee of 11,070 satoshis (=0.04$ USD for first block inclusion).

And that with the mempool having a 43 mb backlog. Obviously those moving coins for the lolz to say "ohhh the blocks are full", "the mempool is full", aren't in any rush to pay - they are just clogging the system with spam as cheaply as they can get away with it.

If anything, it shows most of the transactions are bogus, conducted just to bloat the blockchain or be used as a "factoid" that "ohhh blocks are full, the mempool is full" bullshit propaganda.

You can make a quantity analysis or a quality analysis.

The quality analysis of the txs is very revealing of what is going on right now. The costs involved to process txs are extremely low at 4 cents for first block inclusion and yet floods of transactions that aren't seemingly in any hurry, are queued up to be processed for zero / near-zero cost. Why?

The customers enjoy 0.04 usd first block inclusion, for "urgent" cases, and that with "full blocks" and a queue in the mempool.

Compared to "pay me 1-10%" + serious fixed fees of any other bank-related / cc-related / paypal based payment system, bitcoin is king.

There is no altcoin which has solved the fundamental tradeoff between supply/demand, low fees and attack spam vector.

If any coin can simply provide free txs for the lolz, then a script-kid can insert 10 Terabytes of transactions for the lolz. In which case that altcoin is a joke-coin, because it will be rendered DOA by the script-kid.

Free or near free txs = dead coin by free or near free bloating, until the miners decide that they don't want to mine this shit (by the time they decide that, they may already have hundreds of gigabytes bloat on their hands).

One could spend less than a few btcs to spam dogecoin for an entire day, which, theoretically, has 10x more "capacity". Actually one could "sponsor" such bloating as a case study.

Size is already 1mb, "blocks are full", "mempool has a backlog of XX mb" and tx fees for 1st block inclusion are currently at 0.04USD.

https://bitcoinfees.21.co/

"The fastest and cheapest transaction fee is currently 30 satoshis/byte, shown in green at the top.
For the median transaction size of 369 bytes, this results in a fee of 11,070 satoshis."

He's talking about fees.

Up to now, only altcoins have implemented decentralized blockchains. Centralized blockchains are just ...highly inefficient hierarchical databases.

For power users metacrawler was the way to go back then. You couldn't count on any single search engine finding what you wanted. Some had it, others didn't, and most of the time you had to search for the same thing over and over in different engines, so metacrawler was better in that regard.

Google was a one-stop-does-it-right kind'of'site that actually had better results than even metacrawler which, in itself, combined the results of others.

What exactly is the situation?

Cointape.com :

Which fee should I use?

The fastest and cheapest transaction fee is currently 30 satoshis/byte, shown in green at the top.
For the median transaction size of 369 bytes, this results in a fee of 11,070 satoshis.


That's 4 cents / 0.04 USD for urgent first block inclusion, despite "full blocks" and 55+ mb of queued transactions. I asked "why" before but I didn't get an answer. Why don't we have "5$ fees" or "100$ fees"? Why is it just 4 cents?

The answer is that the blocks are full with bogus transactions of extremely low fees. The blockchain is being artificially bloated by actors who aren't really intending to pay much or at all, for making payments that they don't really need. Let's send this back and forth 500 times for the lolz, yeah... who cares... as long as it bloats the hell out of this fucker and have the idiots (or moles / propagandists) shout "ohhh fullblockalypse".