So they saw this as an excuse to remove it.
There are a lot of bad things you can call the BTC core devs but they sure as hell seize every opportunity to grab power.
The whole fallacy of the "store of value" thing is two-fold:
(1) Bitcoin's success and utility as a currency gives it a stable point to base its value around. For example, the value would be related to the net amount of transactions occurring (on the darknet usually) and the velocity of money, which would create a sort of natural equilibrium price where people are buying bitcoin as they need it, rather than hodling it to speculate.
(2) Bitcoin, like any asset, is a store of value, but its ability to store value is the same whether it's worth $.0001 per coin or $40,000 per coin.
So they basically turned it into a purely speculative instrument.
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The takeover of Bitcoin from within was a big red-pill moment for me. It was an attack vector I should have seen coming but didn't. I strongly belief that any cryptocurrency community where 99% of users are speculators who view the thing as a stock ticker and nothing more, basically dooms a cryptocurrency to failure.
Anyway, Bitcoin Core as a whole and Blockstream as a company are very malicious actors who destroyed the beauty and elegance of Bitcoin so that they could build a company around exploiting the delta between what the tx fees should be and what they were. And beyond the unjustifiable censorship / suppression, they advanced tons of bogus arguments such as the notion that increasing the block size would ruin the decentralization of the bitcoin network.
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Oh, and lastly there will be a great need for public blockchain cryptos like Bitcoin: for example, if I donate to a non-profit I'd want all their transactions to be publicly viewable. But for normal usage-as-a-currency, I am a huge believer in XMR (monero), which masks who you're sending money to, how much money you sent, and how much money you have. It also has a lot of neat tech like adaptive block size limits, etc that avoided the transaction fee debacle of BTC.
Bitcoin's "fiat" value is pretty much a speculative/opinionated/consensus of belief thing, by nature. This is really no different than the fed saying these 100,000 things are worth this much in dollars. It's an opinion based in observation, but still an opinion, albeit a collective one.
The value of the Bitcoin network itself to provide a wide range of authentication and payment integrations is quite high and a technology potential for changing markets. That is only valuable if it is found long term to be a secure store of integer values.
This [1] is a good recap of what happened
[1]https://hackernoon.com/the-great-bitcoin-scaling-debate-a-ti...
[1] https://hackernoon.com/the-great-bitcoin-scaling-debate-a-ti...
You can see this reasoning today in chains like Bitcoin Cash, these are cheaper, these do have larger blocks, but they have nowhere near the amount of currency transactions to legitimately call it a currency. These chains don't even pull in any extra load when Bitcoin fees start to creep up.
XT is not really worth talking about. It ended up being a failed power grab. BIP101 failed because both sides failed to work together, instead one side got upset and created a hard fork at the next opportunity. Then attempted to call themselves Bitcoin, knowing full well they didn't have the hash rate and subsequent proof of work.
You just refuted your own argument. Bitcoin got attention because of its utility as a currency, in this case for illicit drug purchases. Now as soon as I have to pay an $80 fee, it ceases to be useful as a currency (except ironically for illegal drugs, if you had no other option - which is not the case btw because you can just use monero or bitcoin cash - some users would still pay a 50% fee to get their illegal drugs)
> but they have nowhere near the amount of currency transactions to legitimately call it a currency
What the hell is your definition of currency? A currency is whatever people use as a currency, and by that definition BCH or what have you is absolutely a currency. And fortunately you can send a transaction on-chain for 1 satoshi per byte, instead of having to use a stupid side chain / lightning network pseudo-solution
> instead one side got upset and created a hard fork at the next opportunity. Then attempted to call themselves Bitcoin, knowing full well they didn't have the hash rate and subsequent proof of work.
This is a fundamental misunderstanding of how it works. Within a protocol, the "real" chain is the longest chain. But when a hard fork occurs it splits into two different universes, where BCH people don't recognize BTC as valid and vice versa.
Frankly the software ignorance of so many shows when they discuss this topic of forking. It's worth nothing that the "soft fork" vs "hard fork" distinction, while somewhat real, is part of the whole Bitcoin Core propaganda belief system; they believe that there must be some arbitrary "legitimacy" to a hard fork (where legitimacy is defined as who can shout the loudest after having conveniently censored all the sane people out of the room).
Sure, doubling the block size a few times would likely be fine, so Bitcoin may be overly conservative right now, but I firmly believe any long term solution will require some form of “layer 2” for payments.
A better approach would have been to let the block size scale in line with average connection speeds and storage capacities (per dollar), and let multiple competing groups implement different "layer 2" approaches that users can opt in to.
As a review for anyone reading, miners are compensated via the block reward - a direct grant of Bitcoin to the miner - as well as transaction fees for any transactions they decide to include in their block. (The person who mines the block gets to unilaterally decide which transactions go in the block; functionally this means they just sort in descending order of $/kb and include as many as they can)
It turns out that many of the big miners have long term contracts with power companies to consumer power; they wouldn't save money by turning their hardware off for short periods of time. Power companies like this arrangement because it lets them predict demand better, and miners like it because they get "bulk rates" on electricity for being predictable in their consumption. The arrangement falls apart when miners turn their hardware on and off.
EDIT: Meeting ended early, so I'll just take this on now. First things first:
> Sure, doubling the block size a few times would likely be fine, so Bitcoin may be overly conservative right now, but I firmly believe any long term solution will require some form of “layer 2” for payments.
So, just to point out the absurdity here explicitly, you are worried that Bitcoin's "decentralization" will be harmed by block size increases eventually, to which your solution is to force a layer 2 payment solution which essentially will force transactions to route through centralized middlemen, rather than the transaction publishing to the blockchain, which is literally the thing that gives bitcoin its value. You don't see something weird about that reasoning?
Additionally, the "you can do a few doublings but eventually you run out of space" is a misunderstanding of how exponential growth works. The capacity to store data has increased exponentially over time, there's no reason to think it won't continue down that path. (I'd really like to avoid going down the "moore's law will end" rabbithole if we can)
Oh, and for good measure this goes into the Bitcoin Core dogma that what keeps the Bitcoin network secure/decentralized is the number of "full nodes" (nodes that have a full copy of the blockchain but do NOT mine), whereas the real security of the network comes from the miners, and it is the capitalist market mechanism of competition for hashpower that gives Bitcoin its resilience to double-spends.
Finally, the whole justification for the hurt "decentralization" is as I said above: the argument that everyone needs to be able to have their own copy of the blockchain. Firstly this ignores that most users use thin wallets and have no need of the whole blockchain; this does insert some trust at a point in the chain but it is a tradeoff most users are more than happy to make for their use-cases. That being said, like I said above, there's no reason to think that one can't keep a whole copy of the blockchain. Indeed the Bitcoin Core argument is just that it's prohibitively expensive, not even that it's impossible, although they define prohibitively expensive from the arbitrary threshold of a random 3rd world person living in poverty.
It's doubly ironic because the literal result of refusing to increase the blocksize - which, not that it matters but Satoshi was never against a blocksize increase; indeed he assumed it would happen - is skyrocketing transaction fees, so that same third world person Bitcoin Core pretends to be so concerned about now has to pay $80 to buy their $1 worth of rice. Oops.
Now the argument comes in: "no they don't need to pay $80, because they'll use the lightning network and thus never need to push to the blockchain!" Which I already addressed above but just to recap, now you've introduced a system of centralized middlemen, AND the very design of the lightning network means that (a) you have to make at least one transaction to seed your "store credit" (and even a single $80 transaction is unaffordable for our hypothetical third world person), and (b) they are required to pay in advance which again puts unrealistic financial stress on them. (For those who aren't familiar with the lightning network, the idea is basically that rather than making bitcoin transactions like normal, I send $20 to a middleman who now gives me $20 of credit and now I can "send" money via an elaborate form of IOUs that never end up on the blockchain, until some point in the future where you resolve onto the chain. It's an optimization strategy that destroys all of the utility of Bitcoin in a misguided attempt to "preserve its decentralization".) If I'm failing to be articulate here it's because the whole concept is so mindblowingly absurd that I don't even know how to properly explain how ridiculous the whole thing is, and is a large part of why I assume that anyone who advocates for it has just literally never used Bitcoin except to speculate
Keeping it spread out across millions of individual home computers, laptops, and mobile devices is the strongest, and perhaps only defense of that.
If you want to argue, at least argue the real issue, not some strawman.
The whole idea in their heads is that nodes will "validate" transactions. Which doesn't make any sense because it's the person engaging in a transaction (on either end) that cares about the state of the blockchain, not some random neutral third party. Your full node can detect an invalid transaction all day but without a way to tell the guy who's about to treat that invalid transaction as valid, the utility isn't there.
No, the real threat to the Bitcoin network is and has always been that a hostile actor would get 51% hashpower (or almost 50% but not quite and roll the dice until they won a few blocks in a row) and issue double-spend attacks.
But fwiw the technology does exist now to do that, just in another protocol:
It's all moot though, because introducing sidechains and the lightning network destroys the value of Bitcoin in a perverted attempt to save it from a non-existent problem.
> Keeping it spread out across millions of individual home computers, laptops, and mobile devices is the strongest, and perhaps only defense of that.
No, because Bitcoin was built to be resilient to Sybil attacks, that's why it's proof-of-work and not proof-of-stake. So it doesn't matter if a million people in Africa have the whole blockchain on their raspberry pis or laptop or whatever, because all I need is one ASIC mega-farm in Antarctica and I can double spend attack the network into oblivion.
It's hashpower that protects and secures the network, nothing else. This is one point that the fraud CSW actually got right.
Having many independent observers seeing the entire chain and detecting problems or attacks against it, facilitates coming to consensus out-of-band about what's happening and what to do about it. It's the ultimate check-and-balance.
The other argument I’m familiar with is longer block propagation times lead to more orphan blocks, which is a centralization pressure.
EDIT: responding to your edits:
> layer 2 payment solution which essentially will force transactions to route through centralized middlemen
1. Layer 2 solutions aren’t necessarily centralized
2. Even if they are all centralized I don’t believe it’s worth sacrificing decentralization in the base layer to support small payments
A payment system's fees need to be 1-2% at most to match credit cards. I remember fees going as high as $80 for a transaction back in the day, so that means you could only reasonably use bitcoin for a minimum of $1000-$10,0000 when fees were the worst. But in reality, Bitcoin can be .000001% (I put a random number of zeroes don't take it literally).
Additionally you're trying to "protect the blockchain" by having people never able to use it. Surely you see the absurdity.
If Bitcoin ever hit Visa scale, there'd be no problem with only well-capitalized miners maintaining a full chain. It's really not an issue, but frankly you should cross that bridge when we get to it anyway. In actuality Bitcoin was hard limited at 3-7 transactions/sec for no reason whatsoever.
There was a talk[1] a few years ago that basically argued that this property only really holds if you look at individual transactions in isolation. It basically boils down to: if you make one transaction to a darknet market, it's impossible to know whether you were actually sending to a darknet market, or whether that was just a decoy transaction. However, if you make repeated transactions to a darknet market, the chances that all of your transactions had a darknet market decoy approaches zero, and you'll be considered suspicious. At that point the police can get a warrant to search your house, or put surveillance on you so they can catch you slipping up irl.
[1] https://www.youtube.com/watch?v=9s3EbSKDA3o core argument starts at around 10 minutes.
If anyone knows of good books or podcasts about the history of BitCoin and the various characters/motivations involved I would be most interested in recommendations. Especially from the governance or legal perspective.
This is a non-idiomatic usage of this expression, unless you're saying that power grabbing is good?
Question: How do you think people will use BTC in the future? Do you think people will ever be able to buy coffee with it?
But I know you’re referring to the transaction fees, and it would only be fair to point out that the cost of a lightning transaction is a few cents.
Or you use a functional cryptocurrency that don't have these ridiculous limitations.
[1]https://twitter.com/peterktodd/status/727078284345917441
[2]http://gavinandresen.ninja/time-to-roll-out-bigger-blocks
Citation desperately needed. Here's a contribution from literally the day before he had his commit access stolen.
https://github.com/bitcoin/bitcoin/commit/006cdf64dc932
Even if he did say that, it's irrelevant to this discussion. Him "no longer contributing" was not the reason his commit access was revoked. It was revoked as a power grab because he wanted to and had the power to increase the block size. Nothing more.
Citation here BTW: https://twitter.com/notgrubles/status/1247592193319198720
Yes I agree this was the public justification for it. That being said, I'm certain they wouldn't have acted in the same way if it had been Luke jr or Greg Maxwell. They pulled his access because he wanted bigger blocks and he was ruining the official narrative.
I believe your citation but the point still stands.
And for future reference, a citation isn't generally accepted when it's just a screenshot you posted in a tweet you once made where the screenshot reveals a comment to a random reddit post with no visible url in it.
The FUD on here is always surprising voluminous.
One BTC is currently a post-tax yearly salary, a third of a tractor, at least one Bridgeport CNC lathe, 12 metric tons of cold rolled 304 stainless coil, or two springtime paid internships for folks out of high school (including their brand new Lincoln welders).
When the price goes up, it means even more people do not know what to do with resources available to them.
Kilowatt hour upon kilowatt hour that must be sequestered only because someone desired to "invest".
A modern metric to measure mediocrity, stagnation, and indecision (a hockey stick graph).
To be fair, I have only listed available assets - not a plan. This is the source of the 7 furrowed brows.
World of Warcraft "gold" is worth more than the Venezuelan Bolivar.
Edit: I’d say the whitepaper did expect this and basically said it could be a problem:
From the abstract:
> As long as a majority of CPU power is controlled by nodes that are not cooperating to attack the network, they'll generate the longest chain and outpace attacker.
Meanwhile my regular joe laptop can earn double its electricity cost in Monero (before it thermally locks up).
“At first, most users would run network nodes, but as the network grows beyond a certain point, it would be left more and more to specialists with server farms of specialized hardware.” – 2008.
“At equilibrium size, many nodes will be server farms with one or two network nodes that feed the rest of the farm over a LAN.” – 2010.
“The design supports letting users just be users. The more burden it is to run a node, the fewer nodes there will be. Those few nodes will be big server farms. The rest will be client nodes that only do transactions and don’t generate.” – 2010.The problem is that Bitcoin's high fees has made it unsuitable for regular payments, so proponents only have the store of value explanation left.
Meanwhile people like me who actually cared about using the damn thing, would be paying a $60 transaction fee on a $20 purchase simply because the powers that be decided that increasing the blocksize, (aka increasing the arbitrary global transaction throughput cap) was somehow antithetical to bitcoin's decentralized design.
Big blocks would have never solved this issue, and you're still free to use Bcash, but you won't as no one does... because that wasn't the issue.
Second layer solutions are the crux of that story, and people who didn't or wouldn't understand that were vocal non-tech people (like Roger Ver) who don't understand basic network protocol topology and why things need to run on secondary, tertiary etc... layers on Bitcoin (the Network) that uses bitcoin (the token) to validate your $20 tx on the blockchain, which by the way if you paid $60 for goes to show you never understood Bitcoin the network.
No one would sacrifice that much to miners instead of just opting for fiat at that point unless there was an absolute imperative need to do so, which at $20 is clearly not the case. I should know I did it.
I've been in this for a long time and the only time tx fees were above $20 was when the Bcash fork happened and Ver/Jihan spammed the network. I paid $25 tx fee on behalf of a new customer (merchant I just on-boarded) that was panicking because they didn't understand mining fee priority (I did explain it to them) and thought they lost they money, when in reality the 5 sat/byte tx cleared in a weeks time and I just recovered my funds then.
I discussed it and felt absolved of responsibility but rather than lose a potential client I just begrudgingly paid the mining fee, to Antminer/Jihan no less, which added insult to injury.
This is far from ideal, and I have a stuck tx as we speak (2sat/byte were clearing without a problem until then) for a over a week now, but it just goes to show that these new billionaire class investors (Saylor) don't understand this tech at all and that they need to use their new found fortune to help flesh out LN to get it to function to its full potential without all this mempool bloat they've help create.
Mainchain (layer 1) is doing EXACTLY what we would think would happen under these conditions even after Segwit, its purposely this way as this is the trade off for security, which makes it less than ideal as a settlement network for small, low cost, individual transactions.
That's what LN is for and I wish these instituinal investment firms would understand that, to date only Jack Dorsey (an actual technologist/developer) has funded Lightening labs, while the Winklevoss, Saylors of the World just keep trying to compete for more headline grabbing media attention and ignoring this vital issue as they do not understand or care to take the time to learn this very obvious fact.
As for me, I want them to keep doing this as it gives me a better buy-in position so I'm all for it.
PS: Keep downvoting, but a 2.58 tx fee cleared in less than an hour with 5+ confirmations, thus proving my point. I think we're far from the bloat we saw back then proving Segwit worked as expected and block sizes weren't a viable option nor tenable a solution to our problem, which I sincerely remains one of LN progress .
I'm sure there are better solutions, but that's one that comes to mind.
The key point, no matter which theory you subscribe to, is that medium of exchange is the most important property.
I'm sure someone out there insists gold is a perfectly legitimate currency for day to day life, and it's not 100% incorrect. But gold is very inconvenient to attempt to use for quick transactions. You would typically exchange gold for some other currency to do day to day spending. The same is basically true of bitcoin now as well, which was (arguably) not the original intent at all.
Those on the Bitcoin Core side of things believe that they are mutually exclusive, and that you can either be a gold-like store of value (that is to say, absolutely fucking useless) or a peer-to-peer electronic cash, but not both.
To me it's so obvious that the value of something as a currency is what makes it equally a good store of value.
- Satoshi
https://p2pfoundation.ning.com/xn/detail/2003008:Comment:956...
[1] "It can be phased in, like:
if (blocknumber > 115000) maxblocksize = largerlimit
It can start being in versions way ahead, so by the time it reaches that block number and goes into effect, the older versions that don't have it are already obsolete. When we're near the cutoff block number, I can put an alert to old versions to make sure they know they have to upgrade."
~ Satoshi Nakamoto, on bitcointalk.org, October 04, 2010, 07:48:40 PM
[2] "Hi Mike,
I'm glad to answer any questions you have. If I get time, I ought to write a FAQ to supplement the paper. There is only one global chain.
The existing Visa credit card network processes about 15 million Internet purchases per day worldwide. Bitcoin can already scale much larger than that with existing hardware for a fraction of the cost. It never really hits a scale ceiling. If you're interested, I can go over the ways it would cope with extreme size. By Moore's Law, we can expect hardware speed to be 10 times faster in 5 years and 100 times faster in 10. Even if Bitcoin grows at crazy adoption rates, I think computer speeds will stay ahead of the number of transactions.
I don't anticipate that fees will be needed anytime soon, but if it becomes too burdensome to run a node, it is possible to run a node that only processes transactions that include a transaction fee. The owner of the node would decide the minimum fee they'll accept. Right now, such a node would get nothing, because nobody includes a fee, but if enough nodes did that, then users would get faster acceptance if they include a fee, or slower if they don't. The fee the market would settle on should be minimal. If a node requires a higher fee, that node would be passing up all transactions with lower fees. It could do more volume and probably make more money by processing as many paying transactions as it can. The transition is not controlled by some human in charge of the system though, just individuals reacting on their own to market forces.
Eventually, most nodes may be run by specialists with multiple GPU cards. For now, it's nice that anyone with a PC can play without worrying about what video card they have, and hopefully it'll stay that way for a while. More computers are shipping with fairly decent GPUs these days, so maybe later we'll transition to that."
~ Satoshi Nakamoto in correspondence with Mike Hearn
So Bitcoin is not exactly what Satoshi planned, but for me it changed my life completely.
Nonsense, he absolutely thought about scaling and in his head it was quite simple...because it was. You just need blocks big enough to allow the transaction throughput the world requires, but they need to be a finite size. That's all.
Not sure what you mean about "block verification time" having a scaling problem. It really doesn't.
This doesn't address the storage requirement problem. 15M transactions per day * 250 bytes per transaction = 1.369 TB per year. After a year most home users wouldn't be able to run a full node without shelling out for extra hardware. After 10 years you'll need to spend hundreds on hard drives just to get started. Sure, it's still decentralized in the sense that you can still run a node, but it'd be closer to usenet (users connecting to independent server farms) than what we have now.
This is an unavoidable physical constraint given Bitcoin’s architecture. You can either prioritize decentralization (and with it, censorship resistance), or you can prioritize TPS or in Ethereum’s case heavy-weigh smart contracts (at the cost of decentralization).
Small-time users can use thin wallets; mega-power users can download the whole blockchain and spend whatever (in perspective, not super significant) amount of money they need for sufficient storage. Users in between can carry a reduced form of the blockchain that doesn't care so much about a full transaction log but accurately describes the state of every wallet's balance (thereby functioning the same from a "verify that they're not bullshitting me" perspective).
It's like Kosher food: if a small percentage of people want food to be kosher, it's often easer to make all food Kosher.
As Michael Saylor says, Bitcoin is good enough to store hundreds of trillions of dollars. Just don't f*ck it up.
But I'm not comfortable with their marketing it as a "world computer" among other things, implying it's more production-ready and robust than it really is.
Do you think that 10 years from now, a 15 TB hard drive will cost at least $200?