Let me make sure I understand this proposal:
On Fri, May 8, 2015 at 11:36 PM, Gregory Maxwell <gmaxw...@gmail.com> wrote:
> (*) I believe my currently favored formulation of general dynamic control
> idea is that each miner expresses in their coinbase a preferred size
> between some minimum (e.g. 500k) and the miner's effective-maximum;
> the actual block size can be up to the effective maximum even if the
> preference is lower (you're not forced to make a lower block because you
> stated you wished the limit were lower). There is a computed maximum
> which is the 33-rd percentile of the last 2016 coinbase preferences
> minus computed_max/52 (rounding up to 1) bytes-- or 500k if thats
> larger. The effective maximum is X bytes more, where X on the range
> [0, computed_maximum] e.g. the miner can double the size of their
> block at most. If X > 0, then the miners must also reach a target
> F(x/computed_maximum) times the bits-difficulty; with F(x) = x^2+1 ---
> so the maximum penalty is 2, with a quadratic shape; for a given mempool
> there will be some value that maximizes expected income. (obviously all
> implemented with precise fixed point arithmetic). The percentile is
> intended to give the preferences of the 33% least preferring miners a
> veto on increases (unless a majority chooses to soft-fork them out). The
> minus-comp_max/52 provides an incentive to slowly shrink the maximum
> if its too large-- x/52 would halve the size in one year if miners
> were doing the lowest difficulty mining. The parameters 500k/33rd,
> -computed_max/52 bytes, and f(x) I have less strong opinions about;
> and would love to hear reasoned arguments for particular parameters.
I'm going to try to figure out how much transaction fee a transaction would
have to pay to bribe a miner to include it. Greg, please let me know if
I've misinterpreted the proposed algorithm. And everybody, please let me
know if I'm making a bone-headed mistake in how I'm computing anything:
Lets say miners are expressing a desire for 600,000 byte blocks in their
computed_max = 600,000 - 600,000/52 = 588,462 bytes.
--> this is about 23 average-size (500-byte) transactions less than
effective_max = 1,176,923
Lets say I want to maintain status quo at 600,000 bytes; how much penalty
do I have?
((600,000-588,462)/588,462)^2 + 1 = 1.00038
How much will that cost me?
The network is hashing at 310PetaHash/sec right now.
Takes 600 seconds to find a block, so 186,000PH per block
186,000 * 0.00038 = 70 extra PH
If it takes 186,000 PH to find a block, and a block is worth 25.13 BTC
(reward plus fees), that 70 PH costs:
(25.13 BTC/block / 186,000 PH/block) * 70 PH = 0.00945 BTC
or at $240 / BTC: $2.27
... so average transaction fee will have to be about ten cents ($2.27
spread across 23 average-sized transactions) for miners to decide to stay
at 600K blocks. If they fill up 588,462 bytes and don't have some
ten-cent-fee transactions left, they should express a desire to create a
588,462-byte-block and mine with no penalty.
Is that too much? Not enough? Average transaction fees today are about 3
cents per transaction.
I created a spreadsheet playing with the parameters:
"We" could tweak the constants or function to get a transaction fee we
think is reasonable... but we really shouldn't be deciding whether
transaction fees are too high, too low, or just right, and after thinking
about this for a while I think any algorithm that ties difficulty to block
size is just a complicated way of dictating minimum fees.
As for some other dynamic algorithm: OK with me. How do we get consensus on
what the best algorithm is? I'm ok with any "don't grow too quickly, give
some reasonable-percentage-minority of miners the ability to block further
Also relevant here:
"The curious task of economics is to demonstrate to men how little they
really know about what they imagine they can design." - Friedrich August
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