Bitcoin Core Lead Maintainer Steps Back, Encourages Decentralization
laanwj.github.io
laanwj.github.io
Most recently, this became relevant as the bitcoincore.org website he (co-)maintains received a legal letter from a (fraudulent; as in unproven and repeatedly lying) entity claiming copyright of the 2008 Bitcoin whitepaper. He complied[0] by taking the PDF down from bitcoincore.org and received a lot of slack for it by parts of the community. He then made clear that he'll happily continue to work on Bitcoin Core and Bitcoin in general, but will not be a "martyr"[1] for the project: "it's up to you as bitcoiners to protect it". As a reaction a lot of community members and companies proceeded to host the PDF on their site [2].
[0]: https://github.com/bitcoin-core/bitcoincore.org/pull/740
I’ve seen similar things happen in other cryptocurrency communities, where the primary binaries being released needed one person who was out on a conference circuit or vacation
The infrastructure is mature enough to distribute signing and other duties more adequately, as this person has asked
Whether you like it or not, human beings find a need to store value. In countries without a proper store of value -- due to e.g. government intervention -- they start hoarding commodities (e.g. wheat, cotton) or productive assets like cars.
So the question becomes whether having something like Bitcoin as a replacement for hoarding useful assets is actually environmentally preferable. Hoarding millions of cars as a store of value -- as they do in e.g. Argentina -- also impacts the environment, as we need to produce more cars to account for it. So if hoarding bitcoins replaces this practice, perhaps it will become a net benefit for the environment.
Of course, this point of view assumes the inevitability of hoarding. As far as I can see, it's a survival instinct, which cannot be suppressed -- we can only control which goods are hoarded. Ban money and people will start hoarding less saleable goods.
For example, given n different chains, proof-of-work (PoW) reaches consensus simply by choosing the chain with the most work — irrespective of block contents. Proof-of-stake (PoS), on the other hand, requires granting special meaning to a particular public key (in the first block) in order to reach consensus.
So PoW reaches consensus without granting special meaning to any public key while PoS requires this in order to work.
Not to say that managing fiat money is tremendously wasteful. Credit cards alone take 3% of every transaction on fees that barely make sense. Banks charge ridiculous taxes on pretty much everything they do, and don't even guarantee your money can be withdrawn.
Gold and silver on a per unit-of-value basis require more energy to mine than Bitcoin.
When you compound all of that, you'll realize that Bitcoin energy expenditures are overall not so much of a big deal.
But if they are a big deal for you, at least be consistent and go after gold and silver mining, to start with, and do fight against governments' monopolies on currencies, as those are a lot less "green" and more widespread than Bitcoin.
Additionally, you can come up with new blockchain technologies that don't require PoW, and/or support the existing ones that don't require PoW by parking your money on them. You can also short Bitcoin in a futures market in order to protest against it.
I agree with the OP Bitcoin should run over a network protocol like PJON https://github.com/gioblu/PJON and a private network infrastructure made by people.
The point is, if you switch just the protocol, and keep the same infrastructure nothing will change.
If I make bread and you grow potatoes, we can barter, but it’s much easier to use some intermediary to track the value that we exchanged. The intermediary facilitates this with tokens (coins, notes, cards.)
Bitcoin seems perverse. It puts all the value in the tokens themselves and at the same time I can’t even use it to buy bread or potatoes.
About the only thing I hear that you can buy with Bitcoin is USD, and even the liquidity of that seems questionable beyond a certain amount — the millions maybe but probably not billions.
digital technology only makes barter more easy and accessible.
converting every trade into numbers and back is an outmoded method, which i think will become less used with time.
But it is a recurring theme in history, and most (all?) monetary systems were traded for this alternative within 1000 years. For me, in Western Europe, this was 500 years ago between roughly 1000-1500. The churches were fitted with gold roofs, and because of the lack of coinage and currency, most people lived their lives with this alternative approach, only rarely coming across money, currency, accounting and debt.
Barter is literally my life. I teach other people’s children about life and Computer Science in order to buy potatoes. The children’s parents make medicine and build houses to pay for their children’s education. Is your point that barter is about goods, whereas most people provide services (time, labour?)
Or perhaps you mean that the majority of the economy in terms of wealth is engaged in the investment of capital, and we potato eaters are but a percentage of a percentage?
The book says that this barter method is almost never used, and instead people tend to keep track of favors and things they owe in a more vague way. And every now and then, these debts are settled in a communal fashion. But barter is not used.
So the farmer just asks for the book and gets it. And when autumn comes, and the bookstore owner feels like having an apple, he just goes to the farmer and asks for some. But the two transactions are not really linked.
Of course I (teacher) don’t buy potatoes by teaching the farmer’s children Dijkstra.
Instead of bartering we chooses to track our debts. Using Bitcoin as a cryptographically secure distributed debt tracker sounds great.
But Bitcoin right now feels like a bunch of technology enthusiasts have blessed the world with such a debt tracker while also saying ”btw you collectively owe us $630,000,000,000 worth of stuff”.
I'm not sure where on the globe you are at, but where I am from, groups of friends buy rounds of beers at the bar. You do not keep track of whose turn it is to pay the round or whether someone is buying more expensive stuff, but since you are friends you make sure things are fair over time. But implicitly, not tracking numbers and accounts.
And Graeber argues that that is actually the method that predates currency. Not barter.
I fully agree on the hilariously large "primordial" debt we somehow owe the early miners.
The first few chapters show that historically money predates barter, not the other way around. And that money was born as "I owe you" notes issued by the government.
I know of only one comment [1] Graeber made about bitcoin, and it's too late to ask him now.
[1]: https://twitter.com/davidgraeber/status/990857460176089088
now that we have databases, the number values will slowly become less relevant, and direct information references will come into play.
At least gold has intrinsic value. Aerospace, electronics, it’s pretty.
For me, this skit would make a better illustrative point if the customer showed up wanting to buy tepid lemonade using dodo heads as currency.
Neither. It's making a point against "old man yells at cloud".
A good currency is not consuming a huge chunk of the resources it is tracking. Electricity spent "mining" bitcoin is not somehow recoverable from the tokens. Which makes it worse then gold, which actually is.
What makes much more sense to me is agreeing on a central authority (or a distributed one, if we have the math to be able to do that securely) to track the exchange of things with actual value.
Bitcoin-the-tech feels like it’s partly that, but also it’s partly some side-wheeze for the initial Bitcoin folks to print their own money.
Bitcoin would make sense if the inflation (deflation?) component was removed because at least you then actually had to do something to gain Bitcoin wealth — namely buy computers and burn electricity. If you want $15,000 of Bitcoin then you buy an ASIC and pay your power bills in time.
That seems extremely wasteful. Wouldn’t a global tally of IOUs satisfy the same requirements, without having to have this centralised coin stuff?
Of the two things it represents — a global ledger, and a money printing machine — all I hear about are people focused on the latter.
We don't use gold to buy goods either, but it has a value, because people believe it has. The value of Bitcoin is disputed because not everyone believes in it yet. So it's either a gold in the making or nothing, depending on whether those who believe in it will succeed at convincing the others of its merits.
So yes, while it does have value because people believes it has value. Even if no person wanted gold for its "imagined" value, it would still have value because it's used by many actual companies in actual products (electronics etc). E.g. Every iPhone contains about 0.0012 ounces of gold.
Bitcoin has no value other than imagined by people. I.e. Greater Fool theory.
Industrial applications of gold as imaginary as those applications of Bitcoin are. You can use other metals as conductors, and the whole notion of a specific arrangement of molecules being called “an appliance” or “a jewellery piece” is just human imagination.
Why would I want to do this on Bitcoin specifically? There are thousands of cryptocurrencies that offer this and an entire banking system that specializes in financial transactions.
>You can use other metals as conductors, and the whole notion of a specific arrangement of molecules being called “an appliance” or “a jewellery piece” is just human imagination.
The difference is that it is a form of human imagination shared by most humans. The golden appearance has a certain appeal to it. If humans want it regardless of its value on the financial markets that is a reason to agree that gold is THE store of value instead of silver or Bitcoin being THE store of value. This is a popularity contest and being able to wear and see your gold gives you a massive head start in the popularity contest.
Yes indeed! And you know what they say about too much imagination - VERY dangerous. In light of this, I am making a special one-time offer to you to improve your safety by sending me specific arrangements of molecules you may have that take the form of gold or US "dollars". Act now before it expires!
Actually that is what makes it attractive as a store of value. It's going to last millions of years. Bitcoin is data on HDDs and SSDs and we know that those eventually corrode or simply become obsolete.
And bitcoin is more easy to move around than gold, which is a benefit
Whether it’s widely used as a currency is irrelevant to whether it can be.
It's not used as a currency because of transaction fees. I still remember Steam pulling support for bitpay because people couldn't get their transactions through fast enough because the fees exceeded the value of the transaction. By the time the transaction went through the value of the Bitcoin has changed and you had to send the missing amount in a separate transaction.
You pay $5 transaction fees to pay for a $50 dollar game and then get told that you are missing $1.25. Sending the missing money costs $6.25. A refund costs $5 in transaction fees. On some days the transaction fees were well above the value of the game so you could not do a refund even if you wanted to. Paying $55 to refund a $50 transaction doesn't make sense. Paying $56.25 to transfer the missing amount doesn't make sense either. Your money is just gone and you didn't even get a game.
The order books of Bitcoin exchanges are publicly available.
Last time I checked, Bitfinex had around $100MM in liquidity at 0.1% slippage.
Something that has outlived its fitness as a payment system, but still trundles on due to its own inertia. Like oil execs that refuse to acknowledge that the age of oil is coming to a close, and are now pushing shale oil extraction. A suboptimal waste of effort.
They are not compareable imo.
Not all aspects of two things have to be similar in order for a comparison to succeed (such a comparison is of course actually impossible).
It’s not entirely clear to me how that could possibly be the case, when pasture raised animals often graze land that is completely unsuitable for agriculture. They also eat tons of byproducts of agriculture that are not suitable for human consumption.
This thing about how vegetarianism is sooooo much better for the environment is such a meme. Especially when you take into account what a tragedy modern industrial agriculture really is, with its monocrops, deforestation, and so on.
It summarises the differences in global greenhouse emissions between various types of food, and the contributions of the different sources of these emissions - farming, transport, land use change, and so on.
They cite emissions per kilogram, but that’s completely nonsensical. A kilo of meat does not equal a kilo of spinach in terms of calories or macro-/micro-nutrients.
This is a mistake that I see very often when these kinds of comparisons are made.
Tanks / Fighter jets / drones take more resources.
Crypto dev since 2014.
It’s also a good time to explore the tether bubble: https://link.medium.com/Wsf1ZmBT7cb
BTW, what if the demand for Bitcoin mining hardware accelerated our technological or economical development of semiconductors? I think that's good, and the electricity is small price for that.
If your concern is about avoidable energy waste, you'd need to have a bizarrely weird misunderstanding of the scales here to pick Bitcoin as your hill to die on.
It's like when people complain about how much water you waste by leaving the tap on while you brush your teeth while my dad has the water rights to waste 10,000,000L/year of creek water because he owns a single cow. People have such little understanding of the relative scale of everything, so they laser-focus on whatever inconsequential, concrete morsel that sounds good to them.
Regardless, I would be sceptical about that 621 KWh. Does not sound realistic...
If a bitcoin costs $30k then the amount of electricity you can afford to waste is exactly... $30k worth of electricity. Higher energy efficiency is just a competition among miners. Less efficient ones have to stop mining.
If anything that is contributing more to energy waste because you have to periodically replace old miners and not every miner managed to break even on their less efficient hardware by the time the latest hardware became available. It's probably less significant over the long term though because eventually there is a limit to how efficient bitcoin miners can be.
If the network wasn't consuming absurd amounts of hardware and energy, anyone could waltz in and use a perfectly reasonable amount of hardware and energy to break it. So yes, it does need to constantly increase as fast as possible. If it ever increased less fast, someone could eventually exploit that delta.
That seems like a lot, no?
You didn'tconsider that the things you have listed cost money. There is an incentive to reduce them to the absolute minimum because you would go broke if you leased commercial property and put 200 clothes dryers running 24/7.
Mining bitcoin is a profitable activity. You can afford to do that. The price of bitcoin dictates how profitable mining is. The higher the bitcoin price and transaction fees the higher the margins and that means you can buy more miners and thus waste more energy. There is no limit to how much energy can be wasted. Every time you think this is an insane amount of energy it can always get worse. Right now it is only at approximately 80 TWh. In 10 years it could be at 300 TWh. In 20 years it could be 1000TWh. There is no reason why this shouldn't happen.
Bitcoin doubled multiple times in the last decade. The value of a bitcoin could easily outpace the reduction in block reward.
I can never take the bitcoin climate change hysteria seriously. I wonder why the people who write these articles aren't calling out traditional banks? hmm.
Banks are also a very different model with different overheads compared to Bitcoin. I'd argue that banking infrastructure is quite wasteful with their physical skyscrapers and vaults. Executives at banks would argue otherwise.
Bitcoin aims to disrupt financial services to some extent. A significant electricity cost shouldn't be a surprise. Does that mean it should be outlawed? I think not.
If we banned every costly disruptive idea that emerged, we wouldn't get anywhere.
I wonder how much energy we would consume if bitcoin would replace the whole banking sector? Back-of-an-envelope calculation: If it would be powering billion transactions per day, it would need 400 nuclear power plants to provide required energy.
I don't know if we should ban bitcoin or not. I don't have any strong sentiment towards it. But if the numbers here are right, I don't think it is a viable main stream currency.
* Of course, at the moment it's not a very good store of value because of the price volatility. But advocates argue that these are just growing pains.
It would seem to me that the efficiency gap is insurmountably large.
(in response to a single BTC transaction consuming 621 kwh)
A Tesla gets 4.1 miles per KWh. So one transaction costs 2,546 miles. Seattle to Boston is 3k miles.
Paying for a burger with bitcoin has the same environmental cost as driving that burger to you from the other coast.
The power consumption does not depend on the block size.
Securing blocks has a cost that is independent of the block size. Bitcoin Cash is a good example.
I also find it interesting that Bitcoin Cash is not as prone to deflation which means that in theory you could actually use it as money. It never caught on so it is effectively dead though. It's best to forget about it.
a) Sending payments is not the only purpose of the network, it's issuance, it's security, it's to make the ledger immutable.
b) No one's buying a burger with bitcoin. Bitcoin's production is a monetary base. Using the same block space you can have an infinite number of economic transactions happen with the same power consumption (block) on multiple layers, each with a degrading level of security. Of course you don't need the full force of the bitcoin network for a coffee or burger.
That’s exactly the point being made, isn’t it? No one uses Bitcoin as a currency for real transactions.
From the angle that bitcoin is useless, it's easy to dismiss it as waste. The reality is that you live in world where people have different understandings and values than you may have. So advocating against Bitcoin is no different than advocating against air travel. You see no issue in the huge amounts of energy consumption for "seeing the world" and "business travel" but maybe I do.
Use resources the way you wish and so will others. Free markets will decide where scarce resources work best.
Huge energy consumption would be much less of an issue if it wasn’t also causing huge long term problems.
Humanity's reliance on fossil fuels and animal products are two far larger, far more pressing issues than Bitcoin's carbon footprint.
I would additionally rank “bullshit jobs” far above Bitcoin's carbon footprint in a ranking of things causing widespread social ills.
If Bitcoin became global reserve currency, all things would decrease in absolute price, disincentivizing consumerism. As the pace of technological innovation increases, and vendor competition increases along with it, absolute prices in BTC terms will go down even assuming everyone already transacts in BTC exclusively. Higher amount of available products/services, same amount of money, equals lower absolute prices. Assuming 1% annual "growth", that's 1% you gain. This isn't outside the bounds of inflation policies today, and keep in mind those inflation targets skim off the top after haircutting GDP growth — a 1% inflation in an economy expanding by 2% equals the central bank skims the 2% growth plus expands by 1%. In a Bitcoin world, that would be 3% gains for simply holding onto your coins.
As such a deflationary global currency could cause a global economic slowdown, which might be completely necessary to save the planet's natural ecosystems.
If CPI inflation is high that means there are not enough workers to do the most valuable work. Workers reallocate to more productive jobs and earn more money.
Interest rates usually follow CPI inflation. If interest rates are near 0% then you get lots of people starting stupid businesses. That's fine if everyone is unemployed and thus would prefer a bullshit job over a productive job but once the pandemic is over it won't be true anymore.
High interest rates force a company to be profitable enough to at least cover the interest payments. In theory the Fed should raise rates to at least 1% just to match current inflation but the economy is now full of bullshit and that bullshit is going to fail once the cheap money dries up. We can't afford to do that during a pandemic but once it is over it is necessary to cull the useless zombies.
I may or may not have conveyed this in a dramatic way but don't take this as a call to action. If you are invested in the stock market you should always make sure that you don't put too much money into dead companies regardless of how well the economy is doing. Timing crashes or whatever is futile. Your personal goals (risk tolerance aka financial security and when you want to withdraw money) are more important and should be planned well in advance.
What we've ended up with is a planetwide tragedy of the commons - and free markets aren't going to solve this. They can only continue to exacerbate it.
Unregulated pollution is basically like having unregulated crimes. Criminals obviously want to keep committing crimes because they benefit personally.
Imagine if you could just go and mug a random CEO and get $10k out of that and the police won't stop you. The CEO and even those who hate the CEO would agree that muggings are bad. The only one who disagrees is the criminal. Therefore regulation is actually necessary to have a well functioning free market in the first place. Heck, punishing net negative behavior is compatible with the free market. The only question is how that punishment is implemented.
Without CO2 taxes you basically have people legally dump waste into the atmosphere which is shared by everyone equally. It's pretty obvious that there is nothing free about this. You can consider the act of pollution to be a forced transaction between the polluter and every other living being on earth. It's like you are mugging a tiny fraction of a cent off of millions of people.
The obvious idea is to just do the same thing we did with garbage disposal. Just charge a fee that covers the damage. That way the polluter has to weigh the damage he does. In some cases the damage outweighs the benefits, in other cases the benefits outweigh the damage. As a society we only want the latter.
The only real problem with CO2 taxes is that every nation has to agree on them. That's what the paris agreement is for. Dismissing CO2 taxes entirely because of global competition doesn't make sense. Global competition merely puts an upper bound on how high domestic CO2 taxes can be without introducing special tariffs or other means of global enforcement.
I prefer a token amount over complete denial because at that point you can just point out that the price is too low instead of pointlessly arguing about which policy to implement or whether to implement a policy at all.
The debate is not about useless/useful, it is about : can we solve the same needs with a lot less spend energy?
> Use resources the way you wish and so will others. Free markets will decide where scarce resources work best.
That way of thinking leads us to the carbon catastrophe the entire world is trying to reverse right now.
BTC runs mostly on surplus hydroelectric power. This may change based on what's locally available and the local cost of oil gas and coal, but when renewables will become cheaper than fossil (which will never be soon enough) it will not make any sense to mine on fossils.
This doesn't happen with fossil fuels, since the plant operator will of course reduce output as far as possible by reducing fuel consumption.
So it seems entirely reasonable that the bulk of bitcoin mining in the future is going to be done at times when the electricity price is exceptionally low (or negative), and mostly be powered by renewables. It's an economically rational thing to do and as a bonus it will provide some grid stability.
In China it in particular it is seen as an easy way to convert coal to money, as one of the other commenters already linked [1] (which is also economically responsible, given the looming deadlines due to international agreements, but also disastrous to the climate at large).
Also, not to put too fine a point at it, neither Chinese nor US bitcoin miner server farms (mines?) have been found to be using particularly clean energy sources [0].
[0] https://digiconomist.net/bitcoin-energy-consumption/ [1] https://news.ycombinator.com/item?id=25881601
Seems at least half of Bitcoin is currently mined directly using coal.
I hope that initiatives like Lightning Network can help it scale further though.
I would advocate for renewable energy. It's not like miners demand electricity to be from fossil fuels. The electricity gets paid for, how you use it is up to you.
If Bitcoin would run 100% on solar power I guess then it would be fine? Or maybe you're unhappy with Bitcoin because of its goal and not the means it gets there? That would be different discussion.
It feels like people want to argue against Bitcoin, don't have credible arguments, and bring out the climate card.
Climate is going to shit, but not because of Bitcoin.
I dont even know where to start, the fact that you're really criticizing bitcoin when you got factories cars and plastics around you, or the fact that the energy isnt wasted but spent to secure and preserve its speculated market value.
Sure, we could just use fiat (paper money), it's eco-friendly, right? But good luck in dealing with inflation lol.
Simple math for all: your 1 USD today is 0.99x tomorrow, while 1 BTC will always = 1 BTC.
I doesn't seem to make sense to say 1BTC = 1BTC, when people reference it's value to regular currency.
2% inflation is necessary to keep economies fair and productive. Without inflation you basically get hoarders that do nothing productive with their wealth. Deflation increases wealth inequality and is far worse for the average person.
Other solutions to this problem include owning gold and stocks, both of which are also costly, but in ways that are harder to quantify.
If you want to avoid the waste caused by government money printing, lobby your government to stop confiscating wealth by allowing gold-backed money and reducing taxes.
As we head towards a burgeoning climate catastrophe, no-one should be using Bitcoin.
Are there any estimates, what percentage of that is caused by mining bitcoins or other cryptocurrencies? What about things like machine learning or rendering video footage?
I'm afraid that i couldn't find anything comprehensive, but something like that would be very interesting to explore!
There was for a long while talk of whether or not the blockchain would ultimately be adopted for state currencies going forward but it's not clear that this is even an ideal use case.
As an example, I would personally view it as a good thing (and I know others have different views on this) that the government for tax and law enforcement purposes can view the global transaction log (it would certainly simplify taxes while increasing compliance), but is it a good thing that everyone else can view the transaction log too?
Ideally I would like the police and the tax man to know that people are not up to anything nefarious without everyone in the world knowing when you buy birth control or a pregnancy test.
The other issue is obviously money supply. Governments like to be able to manage the supply of currency, but deflationary issuances like Bitcoin are clearly incompatible with that goal.
I actually think it might be interesting for something like voting. Here having a completely public, verifiable record would add a lot to what is currently a very opaque system in a lot of places.
I don't see any evidence that institutional wall street investors are adopting bitcoin in any real way.
It's simultaneously described as a currency for exchange, a store of value and a speculative asset, but logically it cannot be all of these things simultaneously.
As an example, it fell quite sharply the other day while gold and stocks treaded water.
Is it going to $1 or $1 billion? I have no idea. But whatever is, it's certainly not reliably static.
But it looks like bitcoin can still be very useful as an alternative settlement layer for international payments. Either directly for large payments, or under the hood for something like Strike[3].
[1] https://ycharts.com/indicators/bitcoin_average_transaction_f...
[2] https://bitcoinvisuals.com/ln-capacity
[3] https://jimmymow.medium.com/announcing-strike-global-2392b90...
I'm not sure I understand what would be the value of using cryptocurrency under the hood for something like Strike. If they are settling the payments themselves, why not just use a simple database to reconcile their transactions?
A multi-country payment service can indeed just update their database. But If there is a net flow of value between countries, then they will still have to move that value over slower and more expensive traditional systems. If they implement fast transfers for their users on top of those slow systems, then that means they need idle capital waiting in each destination country so that they can front the money to the receiver. This adds cost and complexity: interface with traditional systems, capital opportunity cost, need to forecast demand, need to do currency hedging, ...
Transfering via bitcoin and converting via exchanges on both ends eliminates that problem. It also makes it easy to partner with other payment services that do the same, while minimizing the need for trust.
You have to, ahem, adjust for deflation.
That is misleading in two respects: Funds in lightning have high velocity, so it doesn't necessarily take a lot of funds to support a lot of economic activity.
Channels were originally all public, but now most channels are private, so no one really knows how much funds are involved in lightning channels.
People who use lightning generally describe it very positively. The bigger impediment to making small frequent payments is Bitcoin's tax treatment: E.g. in the US every single purchase made with Bitcoin requires line item reporting to the IRS and cost basis tracking.
Your keys, your bitcoin.
1 USD = 0.99 USD tomorrow.
1 BTC will always be 1 BTC.
The actual value of 1 USD may change. But so does the value of 1 BTC
Thats just lame and missing the entire point of bitcoin lol.
I dont even know where to start, the fact that you're really criticizing bitcoin when you got factories cars and plastics around you, or the fact that the energy isnt wasted but spent to secure and preserve its speculated market value.
Sure, we could just use fiat (paper money), it's eco-friendly, right? But good luck in dealing with inflation lol.
Simple math for all: your 1 USD today is 0.99x tomorrow, while 1 BTC will always = 1 BTC.
If it weren't for his timidity, Bitcoin would have hard forked in 2015 to raise the block size limit to allow for mass-adoption.
BCash, for example, some loopy "large block" clone of Bitcoin has only rarely had more than $1 in fees in blocks-- and not primarily because it has fewer transactions (though it does), but because there is no cause to pay more than negligible amounts when both capacity isn't scarce and mining isn't completely centralized.
The result is that the BitcoinUnlimited (one of the BCash clients) "chief scientist" proposes that security must be paid for by perpetual inflation... and they've been moving towards abandoning Bitcoin's decentralized consensus-- e.g. bcash clients will no longer reorg so if there is a split deeper than a few blocks (caused by a network partition or a block race), their nodes will just split off into separate networks. Quite a mess.
Ethereum has larger transaction fees than Bitcoin right now, on a larger volume of transactions, so in practice, that is not true.
The addressable market will necessarily shrink with too small blocks.
Now of course when Bitcoin Cash launches, with most of the world unaware of it, it's not going to get as much as adoption, and by extension transaction fees, as Bitcoin, irrespective of its block size limit, so your comparison is inappropriate.
Back in the past the issuer of Ethereum stated publicly that online money should not cost more than 5cts/txn... and yet here we are with $50 transactions there.
BCash has not only fewer transaction in spite of tens of millions spent promoting it, but it has vastly lower fees per transaction. If its blocks were half full at 10x the current feerate (and many times larger than bitcoin blocks), its fee income would still be a tiny fraction of Bitcoin's-- and nowhere near enough to support even the extremely low level of security it currently has.
https://twitter.com/btcinchina/status/804163370043588608
"3rd largest #bitcon #mining pool BW signal support for 8M blocksize, following the consensus from scaling conference."
And another initiative:
https://www.coindesk.com/btcchina-support-gives-bip-100-bitc...
"BTCChina Support Gives BIP 100 Bitcoin Hashrate Majority"
>>there were futures on each of these fork attempts and they traded at a tiny fraction of the price of Bitcoin.
The futures predicted the likelihood of the fork happening, not what percentage of miners supported them.
There is no technological bottleneck preventing a 100X raising of the throughput limit: not Initial Blockchain Download, which is already being expedited with trusted third party set checkpoints, not computation, not storage and not bandwidth.
The vast majority of Bitcoin agreed with my sentiment, and that was the sentiment expressed by Satoshi any time he commented on it.
It was just irresponsible, overly timid leadership allowing a loud minority to sabotage Bitcoin's widely supported roadmap.
Responding to the comment below:
1. You can prune spent transactions. Only the UTXO set needs to be stored, so you don't need to store 5 TB more each year. But even that wouldn't be prohibitively costly for thousands of hobbyists worldwide. So even if pruning wasn't an option - and it is - Bitcoin's censorship resistance would remain totally secure.
2. You can use checkpointing in initial sync up, instead of downloading the entire transaction history. The hash of the true chain is widely disseminated and Bitcoin nodes already use a form of checkpointing, where they skip validation for transactions before the checkpoint flag, to expedite Initial Blockchain Download.
The average web page these days is over 1 MB. The idea that you need to limit every once-in-every-10-minute block to 1 or 1.6 MB is not, from everything I can see, close to approaching a sound balancing of competing priorities.
There never was a scaling issue.
Bitcoin core has had since the Big Forks a larger number of transactions than Bitcoin Cash, which was forked to allegedly fix the transaction rate.
If the rest of you had actually tried /running a node/ instead of just copying and pasting the fifty cent army's argument of the day maybe you'd realize that.
Layer 2 is where the scaling happens. END OF STORY.
Checkpointing is also currently being utilized in Bitcoin Core, so relying on it further is not a major departure on how things are currently done.
And at 100X current block sizes, validating the entire history with no checkpoints will still be possible for thousands of hobbyists with beefed up but still modest hardware/bandwidth.
The empowerment from 100X more people being able to write transactions to the main chain, with their own private keys, will be well worth the relatively tolerable compromises on full node validation.
Not fully verifying history is a complete departure from how things are done in bitcoin full nodes.
And Bitcoin Core removed even those checkpoints [1].
[1] https://bitcoin.stackexchange.com/questions/75733/why-does-b...
Currently it has checkpointing in the form of assumevalid, which by default causes a full node to skip validation of transaction older than the checkpoint when synchronizing. [1]
[1] https://bitcoin.stackexchange.com/questions/88652/does-assum...
As it is, tens of millions of people can easily stream 700 KB/s HD video 24/7, yet Bitcoin is being kept to a throughput of 2 KB/s based on the claim that increasing it to satisfy market demand would lead to Bitcoin becoming centralized, with only large corporate entities left being able to fully validate.
It's pure FUD.
The security of the system comes from decenteralization, so its goals can't be reached if its only workable for the best funded 10% of the participants. Moreover, the operating cost of a node are only compensated fairly indirectly and are a public good (if everyone else runs an honest node, you don't gain from running your own). As a result, it's not sufficient to just be not-astronomical, it has to be fairly close to painless.
Node's ability to keep up is also only one part of the equation. Bitcoin's long term security is absolutely dependant on transaction fees paying for proof of work. With functionally limitless capacity the natural price of transactions is essentially zero-- as has been demonstrated by competing systems which have found that they can only fund security with inflation.
Most critically-- while you can make a fine argument that some moderate increases (more like 2x or 5x than 100x) are viable without too much increase in security risks-- those kinds of changes (heck, even 100x) don't categorically change the situation.
But we do have technology to categorically change the situation, tech that was thought of and made accordance for before Bitcoin was ever released and has always been part of the long term plans-- regardless of whatever lies motivated parties might want to tell you-- tech like lighthing adds essentially unlimited transaction throughput to Bitcoin because it doesn't require public broadcast for each and every transaction. I was talking to someone this morning who is doing a test sustaining 400 transactions per second.
> and that was the sentiment expressed by Satoshi any time he commented on it.
Sorry, that is just a flat out lie-- at I pointed out in a prior comment literally the last public statement Satoshi made on the matter of scalablity/resource usage was: "Bitcoin users might get increasingly tyrannical about limiting the size of the chain so it's easy for lots of users and small devices."
https://bitcointalk.org/index.php?topic=1790.msg28917#msg289...
There is a long history of the position I'm presenting, going back to many of Bitcoin's earliest participants.
As for initial synchronization:
There is no basis for claiming users cannot keep up with it at 100X current throughput levels, and like I said, relying on trusted third party set checkpoints to completely do away with validating the entire blockchain history is always an option, and already one being utilized to some extent with the flag in Bitcoin Core to skip validation on transactions older than a TTP-set checkpoint.
Saying every one should validate, but then limiting the world to 300,000 on-chain writes a day, meaning limiting who can use Bitcoin without third-party intermediaries to 0.1% of the world population, is a bad trade-off. Better 10% of Bitcoiners be able to run their own fully validating node, and all 7 billion people be able to generate transactions *with their own private keys*, than let every one with a PC run a fully validating node, while only 0.1% make writes to Bitcoin with their own private keys.
In a scenario where a party cannot write a transaction to Bitcoin, due to limited on-chain capacity, there is little point in running a fully validating node. Emphasizing full node validation accessibility over main chain write accessibility to this extent is not a sensible prioritization.
Regarding this off-chain payment channel networks Red Herring, there is no reason to be confident that PCNs like the lightning network can provide a mix of trade-offs that will make them compelling to a wide set of users, and indeed the LN has still failed to get traction nearly 6 years after first being proposed.
The capital lock-up requirements, especially in a setting where on-chain transaction fees are high, the need for being online to trustlessly receive funds, and the routing challenges, are all potentially fundamental showstoppers for the LN being a viable technology for widespread utilization/adoption.
Finally, even if payment channel networks work - which is a very speculative 'if' and not one that the entire empowerment of humanity with access to electronic cash should be made dependent on - blocks would still need to be on the order of 100X larger to enable global mass-adoption, as payment channel networks do not completely do away with the need to have on-chain throughput.
> Bitcoin users might get increasingly tyrannical about limiting the size of the chain so it's easy for lots of users and small devices.
https://bitcointalk.org/index.php?topic=1790.msg28917#msg289...
There has always been a challenging trade-off here, which is presumably why he limited the size in the first place.
This trade-off was widely acknowledged in the community going back essentially as far as records do.
And as time has gone on we've only learned more about how some ideas don't work. For example, Satoshi believed businesses would run nodes to verify their own transactions-- but we've found in practice few do, instead outsourcing it to centralized third parties often with dubious security practices.
You're singling out one expression of mildly small-block sentiment and overlooking multiple expressions of strongly large-block sentiment by Satoshi.
He _implemented_ the block size limit, nothing forced him to. Had he wanted it to change automatically he could have coded it that way. Instead, he tended to describe the design as being mostly set in stone. When someone tried to remove the limit he urgently yelled at them to stop (and stated if it were ever needed it could be phased in). I'm sure that his, like everyone elses, understanding of the requirements evolved over time too.
Meanwhile, scaling Bitcoin via layers was endorsed explicitly by essentially every technical voice in the space for years until some got wrapped up with scammers. Satoshi even built specific affordances for payment channels directly into the transaction format, and was the first person to describe their use.
"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. A server farm would only need to have one node on the network and the rest of the LAN connects with that one node."
- November, 2008
Here:
"The current system where every user is a network node is not the intended configuration for large scale. That would be like every Usenet user runs their own NNTP server. The design supports letting users just be users."
-July, 2010
Here:
"It would be nice to keep the [block chain] files small as long as we can.
The eventual solution will be to not care how big it gets.
But for now, while it’s still small, it’s nice to keep it small so new users can get going faster. When I eventually implement client-only mode, that won’t matter much anymore. (note to readers, "client-only mode" refers to SPV mode)"
- August, 2010
Here:
"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."
- in an email to Mike Hearn
Are you really unfamiliar with these, or think they're not worthy of your reader's attention?
The second is saying not literally every user, similar to the third. (and in fact said it would be best to keep things as small as possible for as long as possible!)
The last was in a message thread that discussed using payment channels.
So I do not agree with your claim that they unambiguously supported your position, moreover they were made much earlier-- before there was much practical experience. I already pointed out his last comment on the subject...
There's no evidence to suggest it's discussing mining. It's directly in response to a criticism of the Bitcoin design, where a correspondent argues that everyone validating everything to ensure the transactions they receive are valid will get too costly in computing resources. This is the email that the quoted statement was responding to:
http://www.metzdowd.com/pipermail/cryptography/2008-November...
>To detect and reject a double spending event in a timely manner, one must have most past transactions of the coins in the transaction, which, naively implemented, requires each peer to have most past transactions, or most past transactions that occurred recently. If hundreds of millions of people are doing transactions, that is a lot of bandwidth - each must know all, or a substantial part thereof.
So it's unambiguously about validation. Why would you claim otherwise?
And the last known statements Satoshi made on it were in emails to Mike Hearn, like this one, from December 29 2010:
>>A higher limit can be phased in once we have actual use closer to the limit and make sure it's working OK.
>>Eventually when we have client-only implementations, the block chain size won't matter much. Until then, while all users still have to download the entire block chain to start, it's nice if we can keep it down to a reasonable size.
>>With very high transaction volume, network nodes would consolidate and there would be more pooled mining and GPU farms, and users would run client-only. With dev work on optimising and parallelising, it can keep scaling up.
>>Whatever the current capacity of the software is, it automatically grows at the rate of Moore's Law, about 60% per year.
That is much more clearly his preference/vision than the brief reference to the community turning tyrannical about block sizes, and it was more recent.
The PR to revert that change is still open and locked [2] so I can only imagine what kind of direct messages he would be receiving - I doubt many of them would be what one would consider 'nice'. Not to mention any of it when stepping back seems a little incredulous.
[0] https://news.ycombinator.com/item?id=25858901
[1] https://github.com/bitcoin-core/bitcoincore.org/pull/740
[2] https://github.com/bitcoin-core/bitcoincore.org/pull/744