Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

"However, that is outside the scope of the result that an individual miner's profit per block is always maximized at a finite block size Q* if Shannon Entropy about each transaction is communicated during the block solution announcement. This result is important because it explains how a minimum f

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

Hi Daniele, I don't think there is any contention over the idea that miners that control a larger percentage of the hash rate, h / H, have a profitability advantage if you hold all the other variables of the miner's profit equation constant. I think this is important: it is a centralizing fact

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

On 8/5/2015 3:44 PM, Dave Hudson via bitcoin-dev wrote: I do suspect that if we were to model this more accurately we might be able to infer the "typical" propagation characteristics by measuring the deviation from the expected distribution. The paper models propagation using a single time va

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

> > On 5 Aug 2015, at 15:15, Peter R wrote: > > Hi Dave, > > Thank you for the feedback regarding my paper. > >> The paper is nicely done, but I'm concerned that there's a real problem with >> equation 4. The orphan rate is not just a function of time; it's also a >> function of the block

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

Hi Dave, Thank you for the feedback regarding my paper. > The paper is nicely done, but I'm concerned that there's a real problem with > equation 4. The orphan rate is not just a function of time; it's also a > function of the block maker's proportion of the network hash rate. > Fundamentall

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

To put some flesh on the bones of this idea, imagine a hypothetical security named BLK. Demand for bigger blocks should buy up BLK and demand for smaller blocks should short BLK. The price of BLK in BTC is the ideal block size. Now imagine that there are futures contracts for the security BLK. On t

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

On 5 August 2015 at 12:07, Adam Back wrote: > This prediction market in block-size seems like something extremely > complex to operate and keep secure in a decentralised fashion. Why would it need to be decentralised? Bitcoin.org could run the exchange, and the profits from the exchange could b

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

On 5 August 2015 at 12:51, Hector Chu wrote: > The market I am thinking of would be open to all, not just miners. But > miners would probably be best placed to profit from such a market, as it is > their business to know about the revenue/costs tradeoff. This prediction market in block-size seems

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

On 5 August 2015 at 10:57, Adam Back wrote: > You may find the flexcap idea summarised in outline by Greg Maxwell > and Mark Friedenbach a month or so back interesting in showing that > one can achieve such effects without handing over a free vote to > miners and hence avoid many (though probably

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

Thank you for the feedback, Benjamin. > When you talk about a market, what are you referring to exactly? I define what I mean by healthy, unhealthy, and non-existent markets in Section 7, and I show a figure to illustrate the supply and demand curves in each of these three cases. A healthy mar

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

On 5 August 2015 at 11:18, Hector Chu via bitcoin-dev wrote: > Miners would be uniquely placed to know how best to vary the block size to > maximize their > profit resulting from these two prices. [...] > In that respect a dynamic block size voted on by miners periodically would > go some way to

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

On 5 August 2015 at 09:33, Benjamin via bitcoin-dev < bitcoin-dev@lists.linuxfoundation.org> wrote: > A market means that demand and supply are matched continuously, and > Bitcoin has no such mechanism. > Not all markets need to have highly liquid trading outlets in order to be thought of as such

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

Very interesting paper. When you talk about a market, what are you referring to exactly? A market means that demand and supply are matched continuously, and Bitcoin has no such mechanism. A lot of discussion has been around fixing the "supply" of blocksize. A floating number would mean that a hardc

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

> Researchers should also keep in mind that some of developers are immature and have limited knowledge or experience beyond their Bitcoin expertise ("Idiot-savants"). Others want to be in "charge" of drama-laced posts on reddit and they get upset if others do the same things. > In any case these

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

For those wishing to do actual research, esp. people such as profs mentoring students, ... But keep in mind that you're wading into a highly politically charged research field with billions hanging on the blocksize limit; understand that people aren't happy when flawed papers end up on reddi

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

> On 4 Aug 2015, at 14:30, Gavin Andresen wrote: > > On Tue, Aug 4, 2015 at 2:41 PM, Dave Hudson via bitcoin-dev > > wrote: > Fundamentally a block maker (pool or aggregation of pools) does not orphan > its own blocks. > > Unless the block maker

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

-BEGIN PGP SIGNED MESSAGE- Hash: SHA256 On 4 August 2015 17:30:28 GMT-04:00, Gavin Andresen via bitcoin-dev wrote: >On Tue, Aug 4, 2015 at 2:41 PM, Dave Hudson via bitcoin-dev < >bitcoin-dev@lists.linuxfoundation.org> wrote: > >> Fundamentally a block maker (pool or aggregation of pool

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

On Tue, Aug 4, 2015 at 2:41 PM, Dave Hudson via bitcoin-dev < bitcoin-dev@lists.linuxfoundation.org> wrote: > Fundamentally a block maker (pool or aggregation of pools) does not orphan > its own blocks. Unless the block maker has an infinitely fast connection to it's hashpower OR it's hashpower

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

-BEGIN PGP SIGNED MESSAGE- Hash: SHA256 On 4 August 2015 14:41:53 GMT-04:00, Dave Hudson via bitcoin-dev wrote: >The paper is nicely done, but I'm concerned that there's a real problem >with equation 4. The orphan rate is not just a function of time; it's >also a function of the block

Re: [bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

The paper is nicely done, but I'm concerned that there's a real problem with equation 4. The orphan rate is not just a function of time; it's also a function of the block maker's proportion of the network hash rate. Fundamentally a block maker (pool or aggregation of pools) does not orphan its

[bitcoin-dev] "A Transaction Fee Market Exists Without a Block Size Limit"--new research paper suggests

Dear Bitcoin-Dev Mailing list, I’d like to share a research paper I’ve recently completed titled “A Transaction Fee Market Exists Without a Block Size Limit.” In addition to presenting some useful charts such as the cost to produce large spam blocks, I think the paper convincingly demonstrates