Hi all, I am a post-graduate economist writing a paper on the incentives of mining. Even though this issue has been debated in the forums, I think it is important to get a sense of the magnitude of the incentives at play and determine what implications this has for the transaction fee market.
As it has been pointed out before the marginal cost for miners does not stem from the private cost of the miner validating the signature and including it in the list of transactions in the block but rather the increased probability that the block will be orphaned as a result of slower propagation. Gavin did some back of the envelope worst case calculations but these overstated the effect of propagation delay. The reason being the 80ms additional time to reach 50% of the network is spread throughout the time that it takes to reach 50% of the network. During this time miners are notified about the block and treat it as the longest chain and hence are no longer mining with the aim to produce a competing block. I am looking to calculate the change in the curvature of the probability mass function that a block hears about my block in any given second as a function of the block size. Although there is likely to be significant noise here, there seems to be some stable linear relationships with the time that it takes to reach different quartiles. Has anyone done this? I have used some empirical data that I am happy to share but ideally I would like analytical solutions. Following Peter Todd, I also find the concerning result that propagation delays results in increasing returns to higher shares of the hashing power. Indeed it may well be in the interest of large pools to publish large blocks to increase propagation delays on the network which would increase orphan rates particularly for small miners and miners that have not invested in sufficient bandwidth / connectivity. If a small miner hears about a block after 4.5 seconds on average there is a 0.7% chance that there is already a block in circulation. Large miners can increase the time that it takes for small miners to hear about blocks by increasing the size of their blocks. For example if the time that it takes for a small miner to hear about the block goes to 12 seconds there is a 2 percent chance there is already a block in circulation for the small miner. There is also a 1.2% chance that there will be a competing block published after a small miner propagates in the time that it gets to full propagation. Am I getting this right that the probability of a miner’s block being orphaned is comprised of the probability that the miner was not the first to find a valid block and the probability that given they are first, someone else in the absence of hearing about it finds a competing valid block. One question is: Are orphans probabilistic and only resolved after hearing about a new block that lengthens the chain or is there a way to know in advance? Is it frowned upon to mine on top of a block that you have just found even though it is very likely going to end up an orphan? Would be happy to share the draft form of the paper and receive any feedback. Finally, at coinometrics we are working on a modified client to capture information on network propagation and would invite any suggestions of any other useful statistics that would be useful in the development of software. Best, Jonathan On 21 Apr 2014, at 01:16, <bitcoin-development-requ...@lists.sourceforge.net> <bitcoin-development-requ...@lists.sourceforge.net> wrote: > Send Bitcoin-development mailing list submissions to > bitcoin-development@lists.sourceforge.net > > To subscribe or unsubscribe via the World Wide Web, visit > https://lists.sourceforge.net/lists/listinfo/bitcoin-development > or, via email, send a message with subject or body 'help' to > bitcoin-development-requ...@lists.sourceforge.net > > You can reach the person managing the list at > bitcoin-development-ow...@lists.sourceforge.net > > When replying, please edit your Subject line so it is more specific > than "Re: Contents of Bitcoin-development digest..." > > > Today's Topics: > > 1. Re: "bits": Unit of account (Oliver Egginger) > 2. Re: "bits": Unit of account (Christophe Biocca) > 3. Re: "bits": Unit of account (Gmail) > 4. Re: "bits": Unit of account (Mike Caldwell) > 5. Re: "bits": Unit of account (Justin A) > > > ---------------------------------------------------------------------- > > Message: 1 > Date: Sun, 20 Apr 2014 20:43:24 +0200 > From: Oliver Egginger <bitc...@olivere.de> > Subject: Re: [Bitcoin-development] "bits": Unit of account > To: Bitcoin Development <bitcoin-development@lists.sourceforge.net> > Message-ID: <5354154c.1080...@olivere.de> > Content-Type: text/plain; charset=ISO-8859-1 > > Hello, > > just my two 'cents': > > Terms arises by itself. Just as most people speak of coins when they > mean bitcoins. I do not see that bitcoin is currently in common use > except for speculation. Therefore no term for smaller units has > established yet. No problem in my eyes. Time will tell. > > - oliver > > > > > ------------------------------ > > Message: 2 > Date: Sun, 20 Apr 2014 15:19:38 -0400 > From: Christophe Biocca <christophe.bio...@gmail.com> > Subject: Re: [Bitcoin-development] "bits": Unit of account > To: Bitcoin Development <bitcoin-development@lists.sourceforge.net> > Message-ID: > <CANOOu=9=tanacuyh_p2gqhaguyy39xjhj84hsa_x+6f4moq...@mail.gmail.com> > Content-Type: text/plain; charset=UTF-8 > > Culturally neutral? "bit" in French phonetically collides with slang > for phallus ("bitte", with a silent "e"). Apparently it means "louse" > in Turkish as well. > > Not that this really would be avoidable with any short word (all the > short possible words are usually taken), but it's not neutral. > > On Sun, Apr 20, 2014 at 2:43 PM, Oliver Egginger <bitc...@olivere.de> wrote: >> Hello, >> >> just my two 'cents': >> >> Terms arises by itself. Just as most people speak of coins when they >> mean bitcoins. I do not see that bitcoin is currently in common use >> except for speculation. Therefore no term for smaller units has >> established yet. No problem in my eyes. Time will tell. >> >> - oliver >> >> >> ------------------------------------------------------------------------------ >> Learn Graph Databases - Download FREE O'Reilly Book >> "Graph Databases" is the definitive new guide to graph databases and their >> applications. Written by three acclaimed leaders in the field, >> this first edition is now available. Download your free book today! >> http://p.sf.net/sfu/NeoTech >> _______________________________________________ >> Bitcoin-development mailing list >> Bitcoin-development@lists.sourceforge.net >> https://lists.sourceforge.net/lists/listinfo/bitcoin-development > > > > ------------------------------ > > Message: 3 > Date: Sun, 20 Apr 2014 14:32:26 -0500 > From: Gmail <will.ya...@gmail.com> > Subject: Re: [Bitcoin-development] "bits": Unit of account > Cc: Bitcoin Development <bitcoin-development@lists.sourceforge.net> > Message-ID: <b687d4ad-263f-4594-be7a-ff238b8df...@gmail.com> > Content-Type: text/plain; charset="us-ascii" > > People in the Bitcoin community are sometimes resistant to the idea of using > the word "credit" as a unit of Bitcoin, because Bitcoin is not a credit-based > system. > > However, given that the average person has close to no understanding of what > "credit" means, and probably no concern for the distinction even if they do > know, it may be wise to use the futuristic and easily understandable "credit" > as our human-friendly unit. > > Do others agree that "credits" as a unit of account has a desirable > futuristic connotation? > > Will > > -------------- next part -------------- > A non-text attachment was scrubbed... > Name: smime.p7s > Type: application/pkcs7-signature > Size: 1593 bytes > Desc: not available > > ------------------------------ > > Message: 4 > Date: Sun, 20 Apr 2014 16:28:34 -0400 > From: Mike Caldwell <mcaldw...@swipeclock.com> > Subject: Re: [Bitcoin-development] "bits": Unit of account > To: Christophe Biocca <christophe.bio...@gmail.com> > Cc: Bitcoin Development <bitcoin-development@lists.sourceforge.net> > Message-ID: <4098c706-d67f-474e-9c13-e4c8f56b4...@swipeclock.com> > Content-Type: text/plain; charset="us-ascii" > > By culturally neutral I mean we avoid deliberately invoking a cultural > reference in the name. For example "satoshi" would be a reference to > Japanese culture just for being a common Japanese name regardless of who > Satoshi turns out to be. > > Mike > > Sent from my iPhone > >> On Apr 20, 2014, at 1:20 PM, "Christophe Biocca" >> <christophe.bio...@gmail.com> wrote: >> >> Culturally neutral? "bit" in French phonetically collides with slang >> for phallus ("bitte", with a silent "e"). Apparently it means "louse" >> in Turkish as well. >> >> Not that this really would be avoidable with any short word (all the >> short possible words are usually taken), but it's not neutral. >> >>> On Sun, Apr 20, 2014 at 2:43 PM, Oliver Egginger <bitc...@olivere.de> wrote: >>> Hello, >>> >>> just my two 'cents': >>> >>> Terms arises by itself. Just as most people speak of coins when they >>> mean bitcoins. I do not see that bitcoin is currently in common use >>> except for speculation. Therefore no term for smaller units has >>> established yet. No problem in my eyes. Time will tell. >>> >>> - oliver >>> >>> >>> ------------------------------------------------------------------------------ >>> Learn Graph Databases - Download FREE O'Reilly Book >>> "Graph Databases" is the definitive new guide to graph databases and their >>> applications. Written by three acclaimed leaders in the field, >>> this first edition is now available. Download your free book today! >>> http://p.sf.net/sfu/NeoTech >>> _______________________________________________ >>> Bitcoin-development mailing list >>> Bitcoin-development@lists.sourceforge.net >>> https://lists.sourceforge.net/lists/listinfo/bitcoin-development >> >> ------------------------------------------------------------------------------ >> Learn Graph Databases - Download FREE O'Reilly Book >> "Graph Databases" is the definitive new guide to graph databases and their >> applications. Written by three acclaimed leaders in the field, >> this first edition is now available. Download your free book today! >> http://p.sf.net/sfu/NeoTech >> _______________________________________________ >> Bitcoin-development mailing list >> Bitcoin-development@lists.sourceforge.net >> https://lists.sourceforge.net/lists/listinfo/bitcoin-development > > > > ------------------------------ > > Message: 5 > Date: Sun, 20 Apr 2014 20:16:35 -0400 > From: Justin A <allp...@gmail.com> > Subject: Re: [Bitcoin-development] "bits": Unit of account > To: Mike Caldwell <mcaldw...@swipeclock.com> > Cc: Bitcoin Development <bitcoin-development@lists.sourceforge.net> > Message-ID: > <cak2mux3gufxu_ah0kaw3pukzgx_agok86ahch+7r96ukxzw...@mail.gmail.com> > Content-Type: text/plain; charset="utf-8" > > <delurk> > > What about "ubit", pronounced "YOU-bit", representing 1e-6 bitcoin? Easy to > say, tied in a visual way to the metric micro, leaves the required 2 > decimal places for the marginally numerate.. What more could one want? > > </delurk> > > Also, hi. My first post; plan to get involved over the southern hemisphere > winter if I can learn enough. > On Apr 20, 2014 4:32 PM, "Mike Caldwell" <mcaldw...@swipeclock.com> wrote: > >> By culturally neutral I mean we avoid deliberately invoking a cultural >> reference in the name. For example "satoshi" would be a reference to >> Japanese culture just for being a common Japanese name regardless of who >> Satoshi turns out to be. >> >> Mike >> >> Sent from my iPhone >> >>> On Apr 20, 2014, at 1:20 PM, "Christophe Biocca" < >> christophe.bio...@gmail.com> wrote: >>> >>> Culturally neutral? "bit" in French phonetically collides with slang >>> for phallus ("bitte", with a silent "e"). Apparently it means "louse" >>> in Turkish as well. >>> >>> Not that this really would be avoidable with any short word (all the >>> short possible words are usually taken), but it's not neutral. >>> >>>> On Sun, Apr 20, 2014 at 2:43 PM, Oliver Egginger <bitc...@olivere.de> >> wrote: >>>> Hello, >>>> >>>> just my two 'cents': >>>> >>>> Terms arises by itself. Just as most people speak of coins when they >>>> mean bitcoins. I do not see that bitcoin is currently in common use >>>> except for speculation. Therefore no term for smaller units has >>>> established yet. No problem in my eyes. Time will tell. >>>> >>>> - oliver >>>> >>>> >>>> >> ------------------------------------------------------------------------------ >>>> Learn Graph Databases - Download FREE O'Reilly Book >>>> "Graph Databases" is the definitive new guide to graph databases and >> their >>>> applications. Written by three acclaimed leaders in the field, >>>> this first edition is now available. Download your free book today! >>>> http://p.sf.net/sfu/NeoTech >>>> _______________________________________________ >>>> Bitcoin-development mailing list >>>> Bitcoin-development@lists.sourceforge.net >>>> https://lists.sourceforge.net/lists/listinfo/bitcoin-development >>> >>> >> ------------------------------------------------------------------------------ >>> Learn Graph Databases - Download FREE O'Reilly Book >>> "Graph Databases" is the definitive new guide to graph databases and >> their >>> applications. Written by three acclaimed leaders in the field, >>> this first edition is now available. Download your free book today! >>> http://p.sf.net/sfu/NeoTech >>> _______________________________________________ >>> Bitcoin-development mailing list >>> Bitcoin-development@lists.sourceforge.net >>> https://lists.sourceforge.net/lists/listinfo/bitcoin-development >> >> >> ------------------------------------------------------------------------------ >> Learn Graph Databases - Download FREE O'Reilly Book >> "Graph Databases" is the definitive new guide to graph databases and their >> applications. Written by three acclaimed leaders in the field, >> this first edition is now available. Download your free book today! >> http://p.sf.net/sfu/NeoTech >> _______________________________________________ >> Bitcoin-development mailing list >> Bitcoin-development@lists.sourceforge.net >> https://lists.sourceforge.net/lists/listinfo/bitcoin-development >> > -------------- next part -------------- > An HTML attachment was scrubbed... > > ------------------------------ > > ------------------------------------------------------------------------------ > Start Your Social Network Today - Download eXo Platform > Build your Enterprise Intranet with eXo Platform Software > Java Based Open Source Intranet - Social, Extensible, Cloud Ready > Get Started Now And Turn Your Intranet Into A Collaboration Platform > http://p.sf.net/sfu/ExoPlatform > > ------------------------------ > > _______________________________________________ > Bitcoin-development mailing list > Bitcoin-development@lists.sourceforge.net > https://lists.sourceforge.net/lists/listinfo/bitcoin-development > > > End of Bitcoin-development Digest, Vol 35, Issue 72 > ***************************************************
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