From mboxrd@z Thu Jan 1 00:00:00 1970 Return-Path: Received: from smtp1.linuxfoundation.org (smtp1.linux-foundation.org [172.17.192.35]) by mail.linuxfoundation.org (Postfix) with ESMTPS id 16B0CB8B for ; Fri, 26 Jun 2015 19:18:04 +0000 (UTC) X-Greylist: from auto-whitelisted by SQLgrey-1.7.6 Received: from homiemail-a1.g.dreamhost.com (homie.mail.dreamhost.com [208.97.132.208]) by smtp1.linuxfoundation.org (Postfix) with ESMTP id 1F6D1143 for ; Fri, 26 Jun 2015 19:18:03 +0000 (UTC) Received: from homiemail-a1.g.dreamhost.com (localhost [127.0.0.1]) by homiemail-a1.g.dreamhost.com (Postfix) with ESMTP id 6FB7734806E for ; Fri, 26 Jun 2015 12:18:02 -0700 (PDT) DKIM-Signature: v=1; a=rsa-sha1; c=relaxed; d=jrn.me.uk; h=subject:to :references:from:message-id:date:mime-version:in-reply-to: content-type; s=jrn.me.uk; bh=ix5IoE5oS8mCuBFHewVmO/44Wtc=; b=eQ ANqmMcZsCl1ovyMwmmK51lyMkAEGyckkC78dv4cBaKjy0Eg9ntAEfHRtskHCLmLT OGme2uctzXiRrQeQ0SpnEXWYALvrud8pdxFj/WX8kZ1kUi03TJDgg9ZUcjmVIhqg tmF5IvXpLuYZQthGs3qzZLrh0nBkrNOS5kM/M4uSI= Received: from [192.168.0.6] (cpc12-cmbg17-2-0-cust830.5-4.cable.virginm.net [86.30.131.63]) (using TLSv1 with cipher DHE-RSA-AES128-SHA (128/128 bits)) (No client certificate requested) (Authenticated sender: jrn@jrn.me.uk) by homiemail-a1.g.dreamhost.com (Postfix) with ESMTPSA id D6BE934806C for ; Fri, 26 Jun 2015 12:18:01 -0700 (PDT) To: bitcoin-dev@lists.linuxfoundation.org References: From: Ross Nicoll Message-ID: <558DA56F.3010703@jrn.me.uk> Date: Fri, 26 Jun 2015 20:18:07 +0100 User-Agent: Mozilla/5.0 (Windows NT 6.3; WOW64; rv:38.0) Gecko/20100101 Thunderbird/38.0.1 MIME-Version: 1.0 In-Reply-To: Content-Type: multipart/alternative; boundary="------------090100020403090408000201" X-Spam-Status: No, score=-2.0 required=5.0 tests=BAYES_00,DKIM_SIGNED, DKIM_VALID, DKIM_VALID_AU, HTML_MESSAGE, RCVD_IN_DNSWL_NONE autolearn=ham version=3.3.1 X-Spam-Checker-Version: SpamAssassin 3.3.1 (2010-03-16) on smtp1.linux-foundation.org Subject: Re: [bitcoin-dev] The need for larger blocks X-BeenThere: bitcoin-dev@lists.linuxfoundation.org X-Mailman-Version: 2.1.12 Precedence: list List-Id: Bitcoin Development Discussion List-Unsubscribe: , List-Archive: List-Post: List-Help: List-Subscribe: , X-List-Received-Date: Fri, 26 Jun 2015 19:18:04 -0000 This is a multi-part message in MIME format. --------------090100020403090408000201 Content-Type: text/plain; charset=windows-1252; format=flowed Content-Transfer-Encoding: 7bit I'd argue that at the point where there's consistently more transactions than the network can handle, there are two significant risks. Firstly, that people don't care enough to pay the transaction fees required to get their transaction prioritised over another's, and secondly that as transactions start outright failing (which will happen with enough transactions backlogged) the network is considered unreliable, the currency illiquid, and there's a virtual "bank rush" to get into a more usable currency. I understand the desire to use current demand to model future, however I feel there's a lack of understanding of just how inadequate the main chain is as a global clearance network. My go-to example for this is CHIPS (US-only, inter-bank only clearance) which already handles slightly over 3 transactions per second on average across a year (https://www.theclearinghouse.org/~/media/tch/pay%20co/chips/reports%20and%20guides/chips%20volume%20through%20may%202015.pdf?la=en). If Bitcoin is to be used across a wider portion of the world's population, and/or beyond clearance between financial institutions, it needs larger blocks. This is not about handling the several orders of magnitude more transactions that would be required to replace credit cards or cash, but simply to enabling other technologies to perform that scaling. Also, and I'm aware most on this list do understand the situation better than this, I find it immensely frustrating to see people suggesting that Greece or other large groups should adopt Bitcoin, while there's clearly inadequate support (on chain or off) to do so. Ross On 26/06/2015 19:34, Pieter Wuille wrote: > > > If you wait until the need to increase block size > > It is this sentence I disagree with. Why would there be a need? > Bitcoin provides utility at any block size, and potentially more with > larger blocks. > > But no matter what, I believe the economy will adapt to what is > available. And setting a precedent that increasing the size "because > of a need" is reasonable is to me essentially the same as saying the > size should forever scale to whatever people want. > > I believe the most important effect of a limit block size - people > deciding not to use (on chain) Bitcoin transactions, is already > happening, and it will keep happening at any scale. > > Either the resulting market is one which can live with high > variability in confirmation times, and blocks will end up being nearly > full. Or maybe the current fill level is what is acceptable, and we > don't see much growth beyond this, only a change in what it is used for. > > -- > Pieter > > > > _______________________________________________ > bitcoin-dev mailing list > bitcoin-dev@lists.linuxfoundation.org > https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev --------------090100020403090408000201 Content-Type: text/html; charset=windows-1252 Content-Transfer-Encoding: 7bit I'd argue that at the point where there's consistently more transactions than the network can handle, there are two significant risks. Firstly, that people don't care enough to pay the transaction fees required to get their transaction prioritised over another's, and secondly that as transactions start outright failing (which will happen with enough transactions backlogged) the network is considered unreliable, the currency illiquid, and there's a virtual "bank rush" to get into a more usable currency.

I understand the desire to use current demand to model future, however I feel there's a lack of understanding of just how inadequate the main chain is as a global clearance network. My go-to example for this is CHIPS (US-only, inter-bank only clearance) which already handles slightly over 3 transactions per second on average across a year (https://www.theclearinghouse.org/~/media/tch/pay%20co/chips/reports%20and%20guides/chips%20volume%20through%20may%202015.pdf?la=en). If Bitcoin is to be used across a wider portion of the world's population, and/or beyond clearance between financial institutions, it needs larger blocks. This is not about handling the several orders of magnitude more transactions that would be required to replace credit cards or cash, but simply to enabling other technologies to perform that scaling.

Also, and I'm aware most on this list do understand the situation better than this, I find it immensely frustrating to see people suggesting that Greece or other large groups should adopt Bitcoin, while there's clearly inadequate support (on chain or off) to do so.

Ross

On 26/06/2015 19:34, Pieter Wuille wrote:

> If you wait until the need to increase block size

It is this sentence I disagree with. Why would there be a need? Bitcoin provides utility at any block size, and potentially more with larger blocks.

But no matter what, I believe the economy will adapt to what is available. And setting a precedent that increasing the size "because of a need" is reasonable is to me essentially the same as saying the size should forever scale to whatever people want.

I believe the most important effect of a limit block size - people deciding not to use (on chain) Bitcoin transactions, is already happening, and it will keep happening at any scale.

Either the resulting market is one which can live with high variability in confirmation times, and blocks will end up being nearly full. Or maybe the current fill level is what is acceptable, and we don't see much growth beyond this, only a change in what it is used for.

--
Pieter



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