Re: [bitcoin-dev] A Proposed Compromise to the Block Size Limit

[Peter Todd <pete@petertodd.org>]

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On Sat, Jun 27, 2015 at 01:25:14PM -0400, Michael Naber wrote:
> Global network consensus means that there is global network recognition
> that a particular transaction has occurred and is irreversible. The
> off-chain solutions you describe, while probably useful for other purposes,
> do not exhibit this characteristic and so they are not global network
> consensus networks.

Hub-and-spoke payment channels and the Lightning network are not
off-chain solutions, they are ways to more efficiently use on-chain
transactions to achive the goal of moving assets from point a to point
b, resulting in more economic transactions being done with fewer - but
not zero! - blockchain transactions.

Off-chain transaction systems such as Changetip allow economic
transactions to happen with no blockchain transactions at all.

> Bitcoin Core scales as O(N), where N is the number of transactions. Can we
> do better than this while still achieving global consensus?

No, Bitcoin the network scales with O(n^2) with your above criteria, as
each node creates k transactions, thus each node has to verify k*n
transactions, resulting in O(n^2) total work.

For Bitcoin to have O(n) scaling you have to assume that the number of
validation nodes doesn't scale with the number of users, thus resulting
in a system where users trust others to do validation for them. That is
not a global consensus system; that's a trust-based system.

There's nothing inherently wrong with that, but why change Bitcoin
itself into a trust-based system, when you can preserve the global
consensus functionality, and built a trust-based system on top of it?

-- 
'peter'[:-1]@petertodd.org
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