Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-31 Thread Gavin Andresen
On Sun, May 31, 2015 at 10:59 AM, Jorge Timón jti...@jtimon.cc wrote:

 Whatever...let's use the current subsidies, the same argument applies,
 it's just 20 + 25 = 45 btc per block for miner B vs 27 btc for miner B.
 Miner B would still go out of business, bigger blocks still mean more
 mining and validation centralization

Sorry, but that's ridiculous.

If Miner B is leaving 18BTC per block on the table because they have bad
connectivity, then they need to pay for better connectivity.

If you are arguing I should be able to mine on a 56K modem connection from
the middle of the Sahara then we're going to have to agree to disagree.

So: what is your specific proposal for minimum requirements for
connectivity to run a full node? The 20MB number comes from estimating
costs to run a full node, and as my back-and-forth to Chang Wung shows, the
costs are not excessive.

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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-31 Thread Jorge Timón
On May 31, 2015 5:08 PM, Gavin Andresen gavinandre...@gmail.com wrote:

 On Sun, May 31, 2015 at 10:59 AM, Jorge Timón jti...@jtimon.cc wrote:

 Whatever...let's use the current subsidies, the same argument applies,
it's just 20 + 25 = 45 btc per block for miner B vs 27 btc for miner B.
 Miner B would still go out of business, bigger blocks still mean more
mining and validation centralization

 Sorry, but that's ridiculous.

 If Miner B is leaving 18BTC per block on the table because they have bad
connectivity, then they need to pay for better connectivity.

Well, I was assuming they just can't upgrade their connection (without
moving thei operations to another place). Maybe that assumption is
ridiculous as well.

 If you are arguing I should be able to mine on a 56K modem connection
from the middle of the Sahara then we're going to have to agree to
disagree.

No, I'm not suggesting that.

 So: what is your specific proposal for minimum requirements for
connectivity to run a full node? The 20MB number comes from estimating
costs to run a full node, and as my back-and-forth to Chang Wung shows, the
costs are not excessive.

Well, you were I think assuming a new desktop connecting from somewhere in
the US. I would be more confortable with an eee pc from a hotel in India,
for example. But yeah, targeting some concrete minimum specs seems like the
right approach for deciding how far to go when increasing centralization.

But hitting the limit will be chaos seems to imply that completely
removing the consensus maximum blocksize is the only logical solution. What
happens when we hit the limit next time? When do we stop kicking the can
down the road? When do we voluntarily get that chaos?
Again, that's too far away in the future to worry about it is not a very
conving answer to me.
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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-31 Thread Gavin Andresen
On Sun, May 31, 2015 at 3:05 AM, Peter Todd p...@petertodd.org wrote:

 Yeah, I'm pretty surprised myself that Gavin never accepted the
 compromises offered by others in this space for a slow growth solution


What compromise? I haven't seen a specific proposal that could be turned
into a pull request.




 Something important to note in Gavin Andresen's analysises of this issue
 is that he's using quite optimistic scenarios for how nodes are
 connected to each other.


NO I AM NOT.

I simulated a variety of connectivities; see the .cfg files at
  https://github.com/gavinandresen/bitcoin_miningsim

The results I give in the are bigger blocks better blog post are for
WORST CASE connectivity (one dominant big miner, multiple little miners,
big miner connects to only 30% of little miners, but all the little miners
connected directly to each other).


 For instance, assuming that connections between
 miners are direct is a very optimistic assumption


Again, I did not simulate all miners directly connected to each other.

I will note that miners are VERY HIGHLY connected today. It is in their
best interest to be highly connected to each other.


 that depends on a
 permissive, unregulated, environment where miners co-operate with each
 other - obviously that's easily subject to change!


Really? How is that easily subject to change? If it is easily subject to
change, do bigger blocks have any effect? Why are 1MB blocks not subject to
change?

I talk about what if your government bans Bitcoin entirely here:
   http://gavinandresen.ninja/big-blocks-and-tor

... and the issues are essentially the same, independent of block size.


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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-31 Thread Gavin Andresen
On Sun, May 31, 2015 at 10:46 AM, Jorge Timón jti...@jtimon.cc wrote:

 Here's a thought experiment:

 Subsidy is gone, all the block reward comes from fees.

I wrote about long-term hypotheticals and why I think it is a big mistake
to waste time worrying about them here:
   http://gavinandresen.ninja/when-the-block-reward-goes-away


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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-31 Thread Jorge Timón
Whatever...let's use the current subsidies, the same argument applies, it's
just 20 + 25 = 45 btc per block for miner B vs 27 btc for miner B.
Miner B would still go out of business, bigger blocks still mean more
mining and validation centralization. The question is how far I we willing
to go with this scaling by sacrificing decentralization, but the answer
can't be that's to far away in the future to worry about it, right now as
far as we think we can using orphan rate as the only criterion.
On May 31, 2015 4:49 PM, Gavin Andresen gavinandre...@gmail.com wrote:

 On Sun, May 31, 2015 at 10:46 AM, Jorge Timón jti...@jtimon.cc wrote:

 Here's a thought experiment:

 Subsidy is gone, all the block reward comes from fees.

 I wrote about long-term hypotheticals and why I think it is a big mistake
 to waste time worrying about them here:
http://gavinandresen.ninja/when-the-block-reward-goes-away


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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-30 Thread Matt Corallo


On 05/29/15 23:48, Gavin Andresen wrote:
 On Fri, May 29, 2015 at 7:25 PM, Matt Corallo bitcoin-l...@bluematt.me
 mailto:bitcoin-l...@bluematt.me wrote:
 
 Sadly, this is very far from the whole story. The issue of miners
 optimizing for returns has been discussed several times during this
 discussion, and, sadly, miners who are geographically colocated who are
 optimizing for returns with a free-floating blocksize will optimize away
 50% of the network!
 
 
 I must have missed that analysis-- link please?  Or summary of HOW they
 will optimize away 50% of the network?
 
 Or are you assuming that 50% of the network is colocated... (which is a
 potential problem independent of blocksize)

If, for example, the majority of miners are in China (they are), and
there is really poor connectivity in and out of China (there is) and a
miner naively optimizes for profit, they will create blocks which are
large and take a while to relay out of China. By simple trial-and-error
an individual large miner might notice that when they create larger
blocks which fork off miners in other parts of the world, they get more
income. Obviously forking off 50% of the network would be a rather
extreme situation and assumes all kinds of simplified models, but it
shows that the incentives here are very far from aligned, and your
simplified good-behavior models are very far from convincing.

 
 
  In addition, I'd expect to
  see analysis of how these systems perform in the worst-case, not 
 just
  packet-loss-wise, but in the face of miners attempting to break the
  system.
 
 
  See 
 http://gavinandresen.ninja/are-bigger-blocks-better-for-bigger-miners for
  analysis of but that means bigger miners can get an advantage 
 argument.
 
  Executive summary: if little miners are stupid and produce huge blocks,
  then yes, big miners have an advantage.
 
 I'll talk about transaction fees in a second, but there are several
 problems with this already. As pointed out in the original mail, gfw has
 already been known to interfere with Bitcoin P2P traffic. So now by
 little miners, you mean any miner who is not located in mainland
 China? Whats worse, the disadvantage is symmetric - little miners are at
 a disadvantage when *anyone* mines a bigger block, and miners dont even
 have to be evil for this to happen - just optimize for profits.
 
 
 But the disadvantage is tiny. And essentially zero if they connect to
 your fast relay network (or anything like it).
 

The disadvantage is small with 1MB blocks, but already non-zero. 20MB
blocks are much, much worse (lots of things here dont scale linearly,
even just transfer over a high-packet-loss-link). I mentioned this in my
original email as something which doesnt make me comfortable with 20MB
blocks, but something which needs simulation and study, and might
actually be just fine!

 
  But they're not, so they won't.
 
 I dont know what you're referring to with this. Are you claiming little
 miners today optimize for relay times and have good visibility into the
 Bitcoin network and calculate an optimal block size based on this (or
 would with a 20MB block size)?
 
 
 Do you have another explanation for why miners choose to leave
 fee-paying transactions in their mempool and create small blocks?

Defaults? Dumb designs? Most miners just use the default 750K blocks, as
far as I can tell, other miners probably didnt see transactions relayed
across several hops or so, and a select few miners are doing crazy
things like making their blocks fit in a single packet to cross the gfw,
but that is probably overkill and not well-researched.

  Until the block reward goes away, and assuming transaction fees become
  an important source of revenue for miners.
  I think it is too early to worry about that; see:
 
 http://gavinandresen.ninja/when-the-block-reward-goes-away
 
 You dont make any points here with which I can argue, but let me respond
 with the reason /I/ think it is a problem worth thinking a little bit
 about...If we increase the blocksize sufficiently such that transaction
 fees are not the way in which miners make their money
 
 
 I'm not suggesting that we increase the blocksize sufficiently such that
 transaction fees are not the way in which miners make their money.
 
 I'm suggesting the blocksize be increased to 20MB (and then doubled
 every couple of years).

Do you have convincing evidence that at 20MB miners will be able to
break even on transaction fees for a long time? (The answer is no
because no one has any idea how bitcoin transaction volumes are going to
scale, period.)

 And in which miners make their money is the wrong metric-- we want
 enough mining so the network to be secure enough against double-spends.

Sure, do you have a value of hashpower which is secure enough (which
is a whole other rabbit hole to 

Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-30 Thread Alex Mizrahi

 Stop trying to dictate block growth limits.  Block size will be determined
 by competition between miners and availability of transactions, not through
 hard-coded limits.

Do you even game theory, bro? It doesn't work that way.

Mike Hearn described the problem in this article:
https://medium.com/@octskyward/hashing-7d04a887acc8

But the solution he's proposing is ridiculously bad and unsound: he expects
business owners to donate large sums of money towards mining. If it comes
to this, what sane business owner will donate, say, 100 BTC to miners
instead of seeking some alternatives? Proof-of-stake coins are already
there. I'm well aware of theoretical issues with PoS security, but those
theoretical issues aren't as bad as donation-funded cryptocurrency security.

But you know what works? Mining fees + block size limit.
Users and merchants are interested in their transactions being confirmed,
but block size limit won't allow it to turn into a race to bottom.
This is actually game-theoretically sound.


   I see now the temporary 1MB limit was a mistake.  It should have gone in
 as a dynamic limit that scales with average block size.

This means that miners will control it, and miners couldn't care less about
things like decentralization and about problems of ordinary users. This
means that in this scenario Bitcoin will be 100% controlled by few huge-ass
mining operations.

Possibly a single operation. We already saw GHASH.IO using 51% of total
hashpower. Is that what you want?

Miners are NOT benevolent. This was already demonstrated. They are greedy.
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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-30 Thread Gavin Andresen
On Fri, May 29, 2015 at 7:42 PM, Chun Wang 1240...@gmail.com wrote:

 Hello. I am from F2Pool. We are currently mining the biggest blocks on
 the network.


Thanks for giving your opinion!



 Bad miners could attack us and the network with artificial
 big blocks.


How?

I ran some simulations, and I could not find a network topology where a big
miner producing big blocks could cause a loss of profit to another miner
(big or small) producing smaller blocks:

http://gavinandresen.ninja/are-bigger-blocks-better-for-bigger-miners

(the 0.3% advantage I DID find was for the situation where EVERYBODY was
producing big blocks).


 We think
 the max block size should be increased, but must be increased
 smoothly, 2 MB first, and then after one or two years 4 MB, then 8 MB,
 and so on. Thanks.


Why 2 MB ?   You said that server bandwidth is much more expensive in
China; what would be the difference in your bandwidth costs between 2MB
blocks and 20MB blocks?


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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-29 Thread Gavin Andresen
Matt brought this up on Twitter, I have no idea why I didn't respond weeks
ago (busy writing blog posts, probably):

On Thu, May 7, 2015 at 6:02 PM, Matt Corallo bitcoin-l...@bluematt.me
wrote:



  * Though there are many proposals floating around which could
 significantly decrease block propagation latency, none of them are
 implemented today.


If block propagation isn't fixed, then mines have a strong incentive to
create smaller blocks.

So the max block size is irrelevant, it won't get hit.


 In addition, I'd expect to
 see analysis of how these systems perform in the worst-case, not just
 packet-loss-wise, but in the face of miners attempting to break the system.


See http://gavinandresen.ninja/are-bigger-blocks-better-for-bigger-miners
for analysis of but that means bigger miners can get an advantage
argument.

Executive summary: if little miners are stupid and produce huge blocks,
then yes, big miners have an advantage.

But they're not, so they won't.

Until the block reward goes away, and assuming transaction fees become an
important source of revenue for miners.
I think it is too early to worry about that; see:

   http://gavinandresen.ninja/when-the-block-reward-goes-away


  * I'd very much like to see someone working on better scaling
 technology, both in terms of development and in terms of getting
 traction in the marketplace.


Ok. What does this have to do with the max block size?

Are you arguing that work won't happen if the max block size increases?

  * I'd like to see some better conclusions to the discussion around

 long-term incentives within the system.


Again, see http://gavinandresen.ninja/when-the-block-reward-goes-away for
what I think about that.

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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-29 Thread Matt Corallo


On 05/29/15 22:36, Gavin Andresen wrote:
 Matt brought this up on Twitter, I have no idea why I didn't respond
 weeks ago (busy writing blog posts, probably):
 
 On Thu, May 7, 2015 at 6:02 PM, Matt Corallo bitcoin-l...@bluematt.me
 mailto:bitcoin-l...@bluematt.me wrote:
 
 
 
  * Though there are many proposals floating around which could
 significantly decrease block propagation latency, none of them are
 implemented today.
 
 
 If block propagation isn't fixed, then mines have a strong incentive to
 create smaller blocks.
 
 So the max block size is irrelevant, it won't get hit.

Sadly, this is very far from the whole story. The issue of miners
optimizing for returns has been discussed several times during this
discussion, and, sadly, miners who are geographically colocated who are
optimizing for returns with a free-floating blocksize will optimize away
50% of the network!

 
 In addition, I'd expect to
 see analysis of how these systems perform in the worst-case, not just
 packet-loss-wise, but in the face of miners attempting to break the
 system.
 
 
 See http://gavinandresen.ninja/are-bigger-blocks-better-for-bigger-miners for
 analysis of but that means bigger miners can get an advantage argument.
 
 Executive summary: if little miners are stupid and produce huge blocks,
 then yes, big miners have an advantage.

I'll talk about transaction fees in a second, but there are several
problems with this already. As pointed out in the original mail, gfw has
already been known to interfere with Bitcoin P2P traffic. So now by
little miners, you mean any miner who is not located in mainland
China? Whats worse, the disadvantage is symmetric - little miners are at
a disadvantage when *anyone* mines a bigger block, and miners dont even
have to be evil for this to happen - just optimize for profits.

 But they're not, so they won't.

I dont know what you're referring to with this. Are you claiming little
miners today optimize for relay times and have good visibility into the
Bitcoin network and calculate an optimal block size based on this (or
would with a 20MB block size)?

 Until the block reward goes away, and assuming transaction fees become
 an important source of revenue for miners.
 I think it is too early to worry about that; see:
 
http://gavinandresen.ninja/when-the-block-reward-goes-away

You dont make any points here with which I can argue, but let me respond
with the reason /I/ think it is a problem worth thinking a little bit
about...If we increase the blocksize sufficiently such that transaction
fees are not the way in which miners make their money, then either
miners are not being funded (ie hashpower has to drop to very little),
or the only people mining/funding miners are large orgs who are
running Bitcoin (ie the web wallets, payment processors, big
merchants, and exchanges of the world). Sadly, this is no longer a
decentralized Bitcoin and is, in fact, pretty much how the banking world
works today.

I'm not sure who, if anyone, claims Bitcoin is novel or interesting for
any reason other than its decentralization properties, and, in a world
which you are apparently proposing, the natural course of things is to
very strongly centralize.

  * I'd very much like to see someone working on better scaling
 technology, both in terms of development and in terms of getting
 traction in the marketplace. 
 
 
 Ok. What does this have to do with the max block size?
 
 Are you arguing that work won't happen if the max block size increases?

Yes, I am arguing that by increasing the blocksize the incentives to
actually make Bitcoin scale go away. Even if amazing technologies get
built, no one will have any reason to use them.

   * I'd like to see some better conclusions to the discussion around
 
 long-term incentives within the system.
 
 
 Again, see http://gavinandresen.ninja/when-the-block-reward-goes-away
 for what I think about that.

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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-29 Thread Chun Wang
Hello. I am from F2Pool. We are currently mining the biggest blocks on
the network. So far top 100 biggest bitcoin blocks are all from us. We
do support bigger blocks and sooner rather than later. But we cannot
handle 20 MB blocks right now. I know most blocks would not be 20 MB
over night. But only if a small fraction of blocks more than 10 MB, it
could dramatically increase of our orphan rate, result of higher fee
to miners. Bad miners could attack us and the network with artificial
big blocks. As yhou know, other Chinese pools, AntPool, BW, they
produces ASIC chips and mining mostly with their own machines. They do
not care about a few percent of orphan increase as much as we do. They
would continue their zero fee policy. We would be the biggest loser.
As the exchanges had taught us, zero fee is not health to the network.
Also we have to redevelop our block broadcast logic. Server bandwidth
is a lot more expensive in China. And the Internet is slow. Currently
China has more than 50% of mining power, if block size increases, I
bet European and American pools could suffer more than us. We think
the max block size should be increased, but must be increased
smoothly, 2 MB first, and then after one or two years 4 MB, then 8 MB,
and so on. Thanks.

On Fri, May 8, 2015 at 6:02 AM, Matt Corallo bitcoin-l...@bluematt.me wrote:
 OK, so lets do that. I've seen a lot of I'm not entirely comfortable
 with committing to this right now, but think we should eventually, but
 not much I'd be comfortable with committing to this when I see X. In
 the interest of ignoring debate and pushing people towards a consensus
 at all costs, ( ;) ) I'm gonna go ahead and suggest we talk about the
 second.

 Personally, there are several things that worry me significantly about
 committing to a blocksize increase, which I'd like to see resolved
 before I'd consider supporting a blocksize increase commitment.

  * Though there are many proposals floating around which could
 significantly decrease block propagation latency, none of them are
 implemented today. I'd expect to see these not only implemented but
 being used in production (though I dont particularly care about them
 being all that stable). I'd want to see measurements of how they perform
 both in production and in the face of high packet loss (eg across the
 GFW or in the case of small/moderate DoS). In addition, I'd expect to
 see analysis of how these systems perform in the worst-case, not just
 packet-loss-wise, but in the face of miners attempting to break the system.

  * I'd very much like to see someone working on better scaling
 technology, both in terms of development and in terms of getting
 traction in the marketplace. I know StrawPay is working on development,
 though its not obvious to me how far they are from their website, but I
 dont know of any commitments by large players (either SPV wallets,
 centralized wallet services, payment processors, or any others) to
 support such a system (to be fair, its probably too early for such
 players to commit to anything, since anything doesnt exist in public).

  * I'd like to see some better conclusions to the discussion around
 long-term incentives within the system. If we're just building Bitcoin
 to work in five years, great, but if we want it all to keep working as
 subsidy drops significantly, I'd like a better answer than we'll deal
 with it when we get there or it will happen, all the predictions based
 on people's behavior today say so (which are hopefully invalid thanks
 to the previous point). Ideally, I'd love to see some real free pressure
 already on the network starting to develop when we commit to hardforking
 in a year. Not just full blocks with some fees because wallets are
 including far greater fees than they really need to, but software which
 properly handles fees across the ecosystem, smart fee increases when
 transactions arent confirming (eg replace-by-fee, which could be limited
 to increase-in-fees-only for those worried about double-spends).

 I probably forgot one or two and certainly dont want to back myself into
 a corner on committing to something here, but those are a few things I
 see today as big blockers on larger blocks.

 Luckily, people have been making progress on building the software
 needed in all of the above for a while now, but I think they're all
 very, very immature today.

 On 05/07/15 19:13, Jeff Garzik wrote: On Thu, May 7, 2015 at 3:03 PM,
 Matt Corallo bitcoin-l...@bluematt.me
 mailto:bitcoin-l...@bluematt.me wrote:
 -snip-
 If, instead, there had been an intro on the list as I think we should
 do the blocksize increase soon, what do people think?, the response
 could likely have focused much more around creating a specific list of
 things we should do before we (the technical community) think we are
 prepared for a blocksize increase.

 Agreed, but that is water under the bridge at this point.  You - rightly
 - opened the topic here and now we're discussing it.

 

Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-16 Thread Tier Nolan
On Sat, May 9, 2015 at 4:08 AM, Peter Todd p...@petertodd.org wrote:

  I wonder if having a miner flag would be good for the network.

 Makes it trivial to find miners and DoS attack them - a huge risk to the
 network as a whole, as well as the miners.


To mitigate against this, two chaintips could be tracked.  The miner tip
and the client tip.

Miners would build on the miner tip.  When performing client services, like
wallets, they would use the client tip.

The client would act exactly the same as any node, the only change would be
that it gives miner work based on the mining tip.

If the two tips end up significantly forking, there would be a warning to
the miner and perhaps eventually refuse to give out new work.

That would happen when there was a miner level hard-fork.


 That'd be an excellent way to double-spend merchants, significantly
 increasing the chance that the double-spend would succeed as you only
 have to get sufficient hashing power to get the lucky blocks; you don't
 need enough hashing power to *also* ensure those blocks don't become the
 longest chain, removing the need to sybil attack your target.


To launch that attack, you need to produce fake blocks.  That is
expensive.

Stephen Cale's suggestion to wait more than one block before counting a
transaction as confirmed would also help mitigate.
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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-16 Thread Tier Nolan
On Sat, May 16, 2015 at 5:39 AM, Stephen stephencalebmo...@gmail.com
wrote:

 I think this could be mitigated by counting confirmations differently. We
 should think of confirmations as only coming from blocks following the
 miners' more strict rule set. So if a merchant were to see payment for the
 first time in a block that met their own size restrictions but not the
 miners', then they would simply count it as unconfirmed.


In effect, there is a confirm penalty for less strict blocks.  Confirms =
max(miner_confirms, merchant_confirms - 3, 0)

Merchants who don't upgrade end up having to wait longer to hit
confirmations.

If they get deep enough in the chain, though, the client should probably
 count them as being confirmed anyway, even if they don't meet the client
 nodes' expectation of the miners' block size limit. This happening probably
 just means that the client has not updated their software (or
 -minermaxblocksize configuration, depending on how it is implemented) in a
 long time.


That is a good idea.  Any parameters that have miner/merchant differences
should be modifiable (but only upwards) in the command line.

Why are my transactions taking longer to confirm?

There was a soft fork to make the block size larger and your client is
being careful.  You need to add minermaxblocksize=4MB to your
bitcoin.conf file.

Hah, it could be called a semi-hard fork?
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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-15 Thread Stephen
Comments in line:

 On May 8, 2015, at 11:08 PM, Peter Todd p...@petertodd.org wrote:
 
 Makes it trivial to find miners and DoS attack them - a huge risk to the
 network as a whole, as well as the miners.
 
 Right now pools already get DoSed all the time through their work
 submission systems; getting DoS attacked via their nodes as well would
 be a disaster.

It seems that using a -miner flag to follow rules about smaller blocks would 
only reveal miner nodes if one sent the node a solved block that that was valid 
in every way except the block size. While not impossible, I wouldn't call this 
trivial, as it still requires wasting an entire block's worth of energy. 

 When in miner mode, the client would reject 4MB blocks and wouldn't build
 on them.  The reference client might even track the miner and the non-miner
 chain tip.
 
 Miners would refuse to build on 5MB blocks, but merchants and general users
 would accept them.
 
 That'd be an excellent way to double-spend merchants, significantly
 increasing the chance that the double-spend would succeed as you only
 have to get sufficient hashing power to get the lucky blocks; you don't
 need enough hashing power to *also* ensure those blocks don't become the
 longest chain, removing the need to sybil attack your target.
 

I think this could be mitigated by counting confirmations differently. We 
should think of confirmations as only coming from blocks following the miners' 
more strict rule set. So if a merchant were to see payment for the first time 
in a block that met their own size restrictions but not the miners', then they 
would simply count it as unconfirmed. 

If they get deep enough in the chain, though, the client should probably count 
them as being confirmed anyway, even if they don't meet the client nodes' 
expectation of the miners' block size limit. This happening probably just means 
that the client has not updated their software (or -minermaxblocksize 
configuration, depending on how it is implemented) in a long time. 

I actually like Tier's suggestion quite a bit. I think we could have the 
default client limit set to some higher number, and have miners agree out of 
band on the latest block size limit. Or maybe even build in a way to vote into 
the blockchain. 

Best, 
Stephen
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Re: [Bitcoin-development] Block Size Increase

2015-05-13 Thread Oliver Egginger
08.05.2015 at 5:49 Jeff Garzik wrote:
 To repeat, the very first point in my email reply was: Agree that 7 tps
 is too low  

For interbank trading that would maybe enough but I don't know.

I'm not a developer but as a (former) user and computer scientist I'm
also asking myself what is the core of the problem? Personally, for
privacy reasons I do not want to leave a footprint in the blockchain for
each pizza. And why should this expense be good for trivial things of
everyday life?

If one encounters the block boundary, he or she will do more effort or
give up. I'm thinking most people will give up because their
transactions are not really economical. It is much better for them to
use third-partys (or another payment system).

And that's where we are at the heart of the problem. The Bitcoin
third-party economy. With few exceptions this is pure horror. More worse
than any used car dealer. And the community just waits that things get
better. But that will never happen of its own accord. We are living in a
Wild West Town. So we need a Sheriff and many other things.

We need a small but good functioning economy around the blockchain. To
create one, we have to accept a few unpleasant truths. I do not know if
the community is ready for it.

Nevertheless, I know that some companies do a good job. But they have to
prevail against their dishonest competitors.

People take advantage of the blockchain, because they no longer trust
anyone. But this will not scale in the long run.

- oliver








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Re: [Bitcoin-development] Block Size Increase

2015-05-13 Thread Angel Leon
 Personally, for privacy reasons I do not want to leave a footprint in the
blockchain for each pizza. And  why should this expense be good for trivial
things of everyday life?

Then what's the point?
Isn't this supposed to be an Open transactional network, it doesn't matter
if you don't want that, what matters is what people want to do with it, and
there's nothing you can do to stop someone from opening a wallet and buying
a pizza with it, except the core of the problem you ask yourself about,
which is, the minute this goes mainstream and people get their wallets out
the whole thing will collapse, regardless of what you want the blockchain
for.

Why talk about the billions of unbanked and all the romantic vision if you
can't let them use their money however they want in a decentralized
fashion. Otherwise let's just go back to centralized banking because the
minute you want to put things off chain, you need an organization that will
need to respond to government regulation and that's the end for the
billions of unbanked to be part of the network.


http://twitter.com/gubatron

On Wed, May 13, 2015 at 6:37 AM, Oliver Egginger bitc...@olivere.de wrote:

 08.05.2015 at 5:49 Jeff Garzik wrote:
  To repeat, the very first point in my email reply was: Agree that 7 tps
  is too low

 For interbank trading that would maybe enough but I don't know.

 I'm not a developer but as a (former) user and computer scientist I'm
 also asking myself what is the core of the problem? Personally, for
 privacy reasons I do not want to leave a footprint in the blockchain for
 each pizza. And why should this expense be good for trivial things of
 everyday life?

 If one encounters the block boundary, he or she will do more effort or
 give up. I'm thinking most people will give up because their
 transactions are not really economical. It is much better for them to
 use third-partys (or another payment system).

 And that's where we are at the heart of the problem. The Bitcoin
 third-party economy. With few exceptions this is pure horror. More worse
 than any used car dealer. And the community just waits that things get
 better. But that will never happen of its own accord. We are living in a
 Wild West Town. So we need a Sheriff and many other things.

 We need a small but good functioning economy around the blockchain. To
 create one, we have to accept a few unpleasant truths. I do not know if
 the community is ready for it.

 Nevertheless, I know that some companies do a good job. But they have to
 prevail against their dishonest competitors.

 People take advantage of the blockchain, because they no longer trust
 anyone. But this will not scale in the long run.

 - oliver









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Re: [Bitcoin-development] Block Size Increase

2015-05-09 Thread Andrew
The nice thing about 1 MB is that you can store ALL bitcoin transactions
relevant to your lifetime (~100 years) on one 5 TB hard drive
(1*6*24*365*100=5256000). Any regular person can run a full node and store
this 5 TB hard drive easily at their home. With 10 MB blocks you need a 50
TB drive just for your bitcoin transactions! This is not doable for most
regular people due to space and monetary constraints. Being able to review
all transactions relevant to your lifetime is one of the key important
properties of Bitcoin. How else can people audit the financial transactions
of companies and governments that are using the Bitcoin blockchain? How
else can we achieve this level of transparency that is essential to keeping
corrupt governments/companies in check? How else can we keep track of our
own personal transactions without relying on others to keep track of them
for us? As time passes, storage technology may increase, but so may human
life expectancy. So yes, in this sense, 1 MB just may be the magic number.

Assuming that we have a perfectly functional off-chain transaction system,
what do we actually gain by going from 1 MB to 1000 MB (my approximate
limit for regular users having enough processing power)? If there is no
clear and substantial gain, then it is foolish to venture into this
territory, i.e. KEEP IT AT 1 MB! For example Angel said he wants to see
computers transacting with computers at super speeds. Why do you need to do
this on the main chain? You will lose all the transparency of the current
system, an essential feature.


On Fri, May 8, 2015 at 10:36 PM, Angel Leon gubat...@gmail.com wrote:

 I believe 100MB is still very conservative, I think that's barely 666 tps.

 I also find it not very creative that people are imagining these limits
 for 10 billion people using bitcoin, I think bitcoin's potential is
 realized with computers transacting with computers, which can eat those 666
 tps in a single scoup (what if bittorrent developers got creative with
 seeding, or someone created a decentralized paid itunes on top of bitcoin,
 or the openbazaar developers actually pulled a decentralized amazon with no
 off-chain transaction since they want the thing to be fully decentralized,
 bitcoin would collapse right away)

 I truly hope people see past regular people running nodes at home, that's
 never going to happen. This should be about the miner's networking, storage
 and cpu capacity. They will have gigabit access, they will have shitload of
 storage, and they already have plenty of processing power, all of which are
 only going to get cheaper.

 In order to have the success we all dream we'll need gigabit blocks. Let's
 hope adoption remains slow.

 http://twitter.com/gubatron

 On Fri, May 8, 2015 at 1:51 PM, Alan Reiner etothe...@gmail.com wrote:

 Actually I believe that side chains and off-main-chain transactions will
 be a critical part for the overall scalability of the network.  I was
 actually trying to make the point that (insert some huge block size here)
 will be needed to even accommodate the reduced traffic.

 I believe that it is definitely over 20MB. If it was determined to be 100
 MB ten years from now, that wouldn't surprise me.

 Sent from my overpriced smartphone
 On May 8, 2015 1:17 PM, Andrew onelinepr...@gmail.com wrote:



 On Fri, May 8, 2015 at 2:59 PM, Alan Reiner etothe...@gmail.com wrote:


 This isn't about everyone's coffee.  This is about an absolute
 minimum amount of participation by people who wish to use the network.   If
 our goal is really for bitcoin to really be a global, open transaction
 network that makes money fluid, then 7tps is already a failure.  If even 5%
 of the world (350M people) was using the network for 1 tx per month
 (perhaps to open payment channels, or shift money between side chains),
 we'll be above 100 tps.  And that doesn't include all the non-individuals
 (organizations) that want to use it.


 The goals of a global transaction network and everyone must be able
 to run a full node with their $200 dell laptop are not compatible.  We
 need to accept that a global transaction system cannot be fully/constantly
 audited by everyone and their mother.  The important feature of the network
 is that it is open and anyone *can* get the history and verify it.  But not
 everyone is required to.   Trying to promote a system wher000e the history
 can be forever handled by a low-end PC is already falling out of reach,
 even with our miniscule 7 tps.  Clinging to that goal needlessly limits the
 capability for the network to scale to be a useful global payments system


 These are good points and got me thinking (but I think you're wrong). If
 we really want each of the 10 billion people soon using bitcoin once per
 month, that will require 500MB blocks. That's about 2 TB per month. And if
 you relay it to 4 peers, it's 10 TB per month. Which I suppose is doable
 for a home desktop, so you can just run a pruned full node with all
 transactions 

Re: [Bitcoin-development] Block Size Increase

2015-05-09 Thread Justus Ranvier
-BEGIN PGP SIGNED MESSAGE-
Hash: SHA1

On 05/09/2015 02:02 PM, Andrew wrote:
 The nice thing about 1 MB is that you can store ALL bitcoin
 transactions relevant to your lifetime (~100 years) on one 5 TB
 hard drive (1*6*24*365*100=5256000). Any regular person can run a
 full node and store this 5 TB hard drive easily at their home. With
 10 MB blocks you need a 50 TB drive just for your bitcoin
 transactions! This is not doable for most regular people due to
 space and monetary constraints. Being able to review all
 transactions relevant to your lifetime is one of the key important 
 properties of Bitcoin. How else can people audit the financial
 transactions of companies and governments that are using the
 Bitcoin blockchain? How else can we achieve this level of
 transparency that is essential to keeping corrupt
 governments/companies in check? How else can we keep track of our 
 own personal transactions without relying on others to keep track
 of them for us? As time passes, storage technology may increase,
 but so may human life expectancy. So yes, in this sense, 1 MB just
 may be the magic number.

How many individuals and companies do you propose will ever use
Bitcoin (order of magnitude estimates are fine)

Whatever number you select above, please describe approximately how
many lifetime Bitcoin transactions each individual and company will be
capable of performing with a 1 MB block size limit.

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Re: [Bitcoin-development] Block Size Increase

2015-05-09 Thread Andrew
On Sat, May 9, 2015 at 12:53 PM, Justus Ranvier justusranv...@riseup.net
wrote:

 -BEGIN PGP SIGNED MESSAGE-
 Hash: SHA1

 On 05/09/2015 02:02 PM, Andrew wrote:
  The nice thing about 1 MB is that you can store ALL bitcoin
  transactions relevant to your lifetime (~100 years) on one 5 TB
  hard drive (1*6*24*365*100=5256000). Any regular person can run a
  full node and store this 5 TB hard drive easily at their home. With
  10 MB blocks you need a 50 TB drive just for your bitcoin
  transactions! This is not doable for most regular people due to
  space and monetary constraints. Being able to review all
  transactions relevant to your lifetime is one of the key important
  properties of Bitcoin. How else can people audit the financial
  transactions of companies and governments that are using the
  Bitcoin blockchain? How else can we achieve this level of
  transparency that is essential to keeping corrupt
  governments/companies in check? How else can we keep track of our
  own personal transactions without relying on others to keep track
  of them for us? As time passes, storage technology may increase,
  but so may human life expectancy. So yes, in this sense, 1 MB just
  may be the magic number.

 How many individuals and companies do you propose will ever use
 Bitcoin (order of magnitude estimates are fine)

 Whatever number you select above, please describe approximately how
 many lifetime Bitcoin transactions each individual and company will be
 capable of performing with a 1 MB block size limit.


I would expect at least 10 billion people (directly or indirectly) to be
using it at once for at least 100 years. But I think it's pointless to
guess how many will use it, but rather make the system ready for 10 billion
people. The point is that for small transactions, they will be done
off-chain. The actual Bitcoin blockchain will only show very large
transactions (such as a military purchasing a new space shuttle) or
aggregate transactions (i.e. a transaction consisting of multiple smaller
transactions done off-chain). There can also be multiple layers of chains
creating a tree-like structure. Each chain above will validate the
aggregate transactions of the chain below. You can think of the Bitcoin
blockchain as the hypervisor that manages all the other chains. While
your coffee purchase 4 days ago may not be directly visible within the
Bitcoin blockchain (the main chain), you can trace it down the sequence of
chains until you find it. Same with that fancy dinner your government MP
paid for using public funds. You don't have to store a copy of all
transactions that occurred for each chain in existence, but rather just the
transactions for the chains that you use or are relevant to you.

As you see, this kind of system is totally transparent to all users and
totally flexible (you can choose your sub chains). The flexibility also
allows you to have arbitrarily fast transactions (choose a chain or
lightning channel attached to that chain that supports it), and you can
enjoy a wide variety of features from other chains, like using one chain
that is known to have good anonymity properties.


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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-08 Thread Arkady
--[remove this line and above]--
On Thu, 7 May 2015, Gregory Maxwell wrote:

 Date: Thu, 7 May 2015 00:37:54 +
 From: Gregory Maxwell gmaxw...@gmail.com
 To: Matt Corallo bitcoin-l...@bluematt.me
 Cc: Bitcoin Dev bitcoin-development@lists.sourceforge.net
 Subject: Re: [Bitcoin-development] Block Size Increase
 
 Thanks Matt; I was actually really confused by this sudden push with
 not a word here or on Github--so much so that I responded on Reddit to
 people pointing to commits in Gavin's personal repository saying they
 were reading too much into it.

I saw this. I was also pointing this out to the people who were asking 
me. A
commit to a personal repository does not at first seem more than
experimental. sipa commits weird/neat things to private branches all the
time, after all.

 to share behavior. In the case of mining, we're trying to optimize the
 social good of POW security. (But the analogy applies in other ways 
 too:

About the only argument IMO in favour of block size increases is to 
assume
that making more room in a block will make it attractive to use for more
people at some point in the future: increasing transaction velocity,
increasing economy size, increasing value overall.

 increases to the chain side are largely an externality; miners enjoy 
 the
 benefits, everyone else takes the costs--either in reduced security or
 higher node operating else.)

Who else but miners and pool operators will run full nodes when full 
nodes
are being shut down because they are too large and unwieldy to maintain? 
It
is already so that casual users refuse to run full nodes. This fact is
indisputable. The only question remaining is, Do we care? Arguments
against users who feel that the dataset is too large to run a full node,
full-time, start from a premise that these users are a static and 
irrelevant
fraction. Is this even true? Do we care? I do. I will shortly only be 
able
to run half the nodes I currently do thanks to the growth of the 
blockchain
at its current rate.

 One potential argument is that maybe miners would be _regulated_ to
 behave correctly. But this would require undermining the openness of 
 the
 system--where anyone can mine anonymously--in order to enforce 
 behavior,
 and that same enforcement mechanism would leave a political level to
 impose additional rules that violate the extra properties of the 
 system.

I would refuse to mine under such a regulated regime; moreover, I would
enjoy forking away from this, and, I suspect, the only miners who remain
would be those whose ultimate motivations do not coincide with the 
users.
That is, the set of miners who are users, and the set of users who are
miners, would be wholly non-intersecting.

 So far the mining ecosystem has become incredibly centralized over 
 time.

This is unfortunate but true.

 of the regular contributors to Bitcoin Core do. Many participants
 have never mined or only did back in 2010/2011... we've basically
 ignored the mining ecosystem, and this has had devastating effects,
 causing a latent undermining of the security model: hacking a dozen or
 so computers--operated under totally unknown and probably not strong
 security policies--could compromise the network at least at the tip...

The explicit form of the block dictated by the reference client and
agreed-to by the people who were sold on bitcoin near the beginning 
(myself
included) was explicitly the notion that the rules were static; that the
nature of transaction foundations and the subsidies would not be 
altered.
Here we have a hardfork being contemplated which is not only 
controversial,
but does not even address some of the highest-utility and most-requested
features in peoples' hardfork wishlists.

The fact that mining has effectively been centralized directly implies 
that
destabilizing changes that some well-heeled (and thus theoretically 
capable,
at least) people have explicitly begun plans to fork the blockchain 
about
will have an unknown, and completely unforeseen combined effect.

We can pretend that, If merchants and miners and exchanges go along, 
then
who else matters, but the reality is that the value in bitcoin exists
because *people* use it for real transactions: Not miners, whose profits 
are
parasitically fractionally based on the quality and strength of the 
bitcoin
economy as a whole; not exchanges who lubricate transactions in service 
to
the economy; not even today's merchants whose primary means of accepting
bitcoin seems to be to convert them instantly to fiat and not 
participate
meaningfully in the economy at all; not enriched felons; but actual 
users
themselves.

 Rightfully we should be regarding this an an emergency, and probably
 should have been have since 2011.

There are two ways to look at it, assuming that the blocksize change
increases bitcoin's value to people after all: mining centralization 
will be
corrected; or, mining centralization will not be corrected.

I would argue that rapidly increasing

Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-08 Thread Mike Hearn

  * Though there are many proposals floating around which could
 significantly decrease block propagation latency, none of them are
 implemented today.


With a 20mb cap, miners still have the option of the soft limit.

I would actually be quite surprised if there were no point along the road
from 1mb to 20mb where miners felt a need to throttle their block sizes
artificially, for the exact reason you point out: propagation delays.

But we don't *need* to have fancy protocol upgrades implemented right now.
All we need is to demolish one bottleneck (the hard cap) so we can then
move on and demolish the next one (whatever that is, probably faster
propagation). Scaling is a series of walls we punch through as we encounter
them. One down, onto the next. We don't have to tackle them all
simultaneously.

FWIW I don't think the GFW just triggers packet loss, these days. It's
blocked port 8333 entirely.

 * I'd very much like to see someone working on better scaling
 technology ... I know StrawPay is working on development,


So this request is already satisfied, isn't it? As you point out, expecting
more at this stage in development is unreasonable, there's nothing for
anyone to experiment with or commit to.

They have code here, by the way:

   https://github.com/strawpay

You can find their fork of MultiBit HD, their implementation library, etc.
They've contributed patches and improvements to the payment channels code
we wrote.


  * I'd like to see some better conclusions to the discussion around
 long-term incentives within the system.


What are your thoughts on using assurance contracts to fund network
security?

I don't *know* if hashing assurance contracts (HACs) will work. But I don't
know they won't work either. And right now I'm pretty sure that plain old
fee pressure won't work. Demand doesn't outstrip supply forever - people
find substitutes.
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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Mike Hearn

 Alan argues that 7 tps is a couple orders of magnitude too low


By the way, just to clear this up - the real limit at the moment is more
like 3 tps, not 7.

The 7 transactions/second figure comes from calculations I did years ago,
in 2011. I did them a few months before the sendmany command was
released, so back then almost all transactions were small. After sendmany
and as people developed custom wallets, etc, the average transaction size
went up.
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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Alan Reiner

This isn't about everyone's coffee.  This is about an absolute minimum
amount of participation by people who wish to use the network.   If our
goal is really for bitcoin to really be a global, open transaction
network that makes money fluid, then 7tps is already a failure.  If even
5% of the world (350M people) was using the network for 1 tx per month
(perhaps to open payment channels, or shift money between side chains),
we'll be above 100 tps.  And that doesn't include all the
non-individuals (organizations) that want to use it.

The goals of a global transaction network and everyone must be able
to run a full node with their $200 dell laptop are not compatible.  We
need to accept that a global transaction system cannot be
fully/constantly audited by everyone and their mother.  The important
feature of the network is that it is open and anyone *can* get the
history and verify it.  But not everyone is required to.   Trying to
promote a system where the history can be forever handled by a low-end
PC is already falling out of reach, even with our miniscule 7 tps. 
Clinging to that goal needlessly limits the capability for the network
to scale to be a useful global payments system



On 05/07/2015 03:54 PM, Jeff Garzik wrote:
 On Thu, May 7, 2015 at 3:31 PM, Alan Reiner etothe...@gmail.com
 mailto:etothe...@gmail.com wrote:
  

 (2) Leveraging fee pressure at 1MB to solve the problem is
 actually really a bad idea.  It's really bad while Bitcoin is
 still growing, and relying on fee pressure at 1 MB severely
 impacts attractiveness and adoption potential of Bitcoin (due to
 high fees and unreliability).  But more importantly, it ignores
 the fact that for a 7 tps is pathetic for a global transaction
 system.  It is a couple orders of magnitude too low for any
 meaningful commercial activity to occur.  If we continue with a
 cap of 7 tps forever, Bitcoin *will* fail.  Or at best, it will
 fail to be useful for the vast majority of the world (which
 probably leads to failure).  We shouldn't be talking about fee
 pressure until we hit 700 tps, which is probably still too low. 

  [...]

 1) Agree that 7 tps is too low

 2) Where do you want to go?  Should bitcoin scale up to handle all the
 world's coffees? 

 This is hugely unrealistic.  700 tps is 100MB blocks, 14.4 GB/day --
 just for a single feed.  If you include relaying to multiple nodes,
 plus serving 500 million SPV clients en grosse, who has the capacity
 to run such a node?  By the time we get to fee pressure, in your
 scenario, our network node count is tiny and highly centralized.

 3) In RE fee pressure -- Do you see the moral hazard to a
 software-run system?  It is an intentional, human decision to flood
 the market with supply, thereby altering the economics, forcing fees
 to remain low in the hopes of achieving adoption.  I'm pro-bitcoin and
 obviously want to see bitcoin adoption - but I don't want to sacrifice
 every decentralized principle and become a central banker in order to
 get there.


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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Alan Reiner
On 05/08/2015 01:13 AM, Tom Harding wrote:
 On 5/7/2015 7:09 PM, Jeff Garzik wrote:
 G proposed 20MB blocks, AFAIK - 140 tps
 A proposed 100MB blocks - 700 tps
 For ref,
 Paypal is around 115 tps
 VISA is around 2000 tps (perhaps 4000 tps peak)


For reference, I'm not proposing 100 MB blocks right now.  I was
simply suggesting that if Bitcoin is to *ultimately* achieve the goal of
being a globally useful payment rails, 7tps is embarrassingly small. 
Even with off-chain transactions.  It should be a no-brainer that block
size has to go up.

My goal was to bring some long-term perspective into the discussion.  I
don't know if 100 MB blocks will *actually* be necessary for Bitcoin in
20 years, but it's feasible that it will be.  It's an open, global
payments system.  Therefore, we shouldn't be arguing about whether 1 MB
blocks is sufficient--it's very clearly not.  And admitting this as a
valid point is also an admission that not everyone in the world will be
able to run a full node in 20 years.

I don't think there's a solution that can accommodate all future
scenarios, nor that we can even find a solution right now that avoids
more hard forks in the future.   But the goal of everyone should be
able to download and verify the world's global transactions on a
smartphone is a non-starter and should not drive decisions. 

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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Andrew
On Fri, May 8, 2015 at 2:59 PM, Alan Reiner etothe...@gmail.com wrote:


 This isn't about everyone's coffee.  This is about an absolute minimum
 amount of participation by people who wish to use the network.   If our
 goal is really for bitcoin to really be a global, open transaction network
 that makes money fluid, then 7tps is already a failure.  If even 5% of the
 world (350M people) was using the network for 1 tx per month (perhaps to
 open payment channels, or shift money between side chains), we'll be above
 100 tps.  And that doesn't include all the non-individuals (organizations)
 that want to use it.


 The goals of a global transaction network and everyone must be able to
 run a full node with their $200 dell laptop are not compatible.  We need
 to accept that a global transaction system cannot be fully/constantly
 audited by everyone and their mother.  The important feature of the network
 is that it is open and anyone *can* get the history and verify it.  But not
 everyone is required to.   Trying to promote a system wher000e the history
 can be forever handled by a low-end PC is already falling out of reach,
 even with our miniscule 7 tps.  Clinging to that goal needlessly limits the
 capability for the network to scale to be a useful global payments system


These are good points and got me thinking (but I think you're wrong). If we
really want each of the 10 billion people soon using bitcoin once per
month, that will require 500MB blocks. That's about 2 TB per month. And if
you relay it to 4 peers, it's 10 TB per month. Which I suppose is doable
for a home desktop, so you can just run a pruned full node with all
transactions from the past month. But how do you sync all those
transactions if you've never done this before or it's been a while since
you did? I think it currently takes at least 3 hours to fully sync 30 GB of
transactions. So 2 TB will take 8 days, then you take a bit more time to
sync the days that passed while you were syncing. So that's doable, but at
a certain point, like 10 TB per month (still only 5 transactions per month
per person), you will need 41 days to sync that month, so you will never
catch up. So I think in order to keep the very important property of anyone
being able to start clean and verify the thing, then we need to think of
bitcoin as a system that does transactions for a large number of users at
once in one transaction, and not a system where each person will make a
~monthly transaction on. We need to therefore rely on sidechains,
treechains, lightning channels, etc...

I'm not a bitcoin wizard and this is just my second post on this mailing
list, so I may be missing something. So please someone, correct me if I'm
wrong.




 On 05/07/2015 03:54 PM, Jeff Garzik wrote:

  On Thu, May 7, 2015 at 3:31 PM, Alan Reiner etothe...@gmail.com wrote:


  (2) Leveraging fee pressure at 1MB to solve the problem is actually
 really a bad idea.  It's really bad while Bitcoin is still growing, and
 relying on fee pressure at 1 MB severely impacts attractiveness and
 adoption potential of Bitcoin (due to high fees and unreliability).  But
 more importantly, it ignores the fact that for a 7 tps is pathetic for a
 global transaction system.  It is a couple orders of magnitude too low for
 any meaningful commercial activity to occur.  If we continue with a cap of
 7 tps forever, Bitcoin *will* fail.  Or at best, it will fail to be
 useful for the vast majority of the world (which probably leads to
 failure).  We shouldn't be talking about fee pressure until we hit 700 tps,
 which is probably still too low.

  [...]

  1) Agree that 7 tps is too low

  2) Where do you want to go?  Should bitcoin scale up to handle all the
 world's coffees?

  This is hugely unrealistic.  700 tps is 100MB blocks, 14.4 GB/day --
 just for a single feed.  If you include relaying to multiple nodes, plus
 serving 500 million SPV clients en grosse, who has the capacity to run such
 a node?  By the time we get to fee pressure, in your scenario, our network
 node count is tiny and highly centralized.

  3) In RE fee pressure -- Do you see the moral hazard to a software-run
 system?  It is an intentional, human decision to flood the market with
 supply, thereby altering the economics, forcing fees to remain low in the
 hopes of achieving adoption.  I'm pro-bitcoin and obviously want to see
 bitcoin adoption - but I don't want to sacrifice every decentralized
 principle and become a central banker in order to get there.




 --
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 Widest out-of-the-box monitoring support with 50+ applications
 Performance metrics, stats and reports that give you Actionable Insights
 Deep dive visibility with transaction tracing using APM Insight.
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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Jeff Garzik
On Fri, May 8, 2015 at 10:59 AM, Alan Reiner etothe...@gmail.com wrote:


 This isn't about everyone's coffee.  This is about an absolute minimum
 amount of participation by people who wish to use the network.   If our
 goal is really for bitcoin to really be a global, open transaction network
 that makes money fluid, then 7tps is already a failure.  If even 5% of the
 world (350M people) was using the network for 1 tx per month (perhaps to
 open payment channels, or shift money between side chains), we'll be above
 100 tps.  And that doesn't include all the non-individuals (organizations)
 that want to use it.

 The goals of a global transaction network and everyone must be able to
 run a full node with their $200 dell laptop are not compatible.  We need
 to accept that a global transaction system cannot be fully/constantly
 audited by everyone and their mother.  The important feature of the network
 is that it is open and anyone *can* get the history and verify it.  But not
 everyone is required to.   Trying to promote a system where the history can
 be forever handled by a low-end PC is already falling out of reach, even
 with our miniscule 7 tps.  Clinging to that goal needlessly limits the
 capability for the network to scale to be a useful global payments system


To repeat, the very first point in my email reply was: Agree that 7 tps is
too low  Never was it said that bit

Therefore a reply arguing against the low end is nonsense, and the relevant
question remains on the table.

How high do you want to go - and can Layer 1 bitcoin really scale to get
there?

It is highly disappointing to see people endorse moar bitcoin volume!
with zero thinking behind that besides adoption!  Need to actually
project what bitcoin looks like at the desired levels, what network
resources are required to get to those levels -- including traffic to serve
those SPV clients via P2P -- and then work backwards from that to see who
can support it, and then work backwards to discern a maximum tps.

-- 
Jeff Garzik
Bitcoin core developer and open source evangelist
BitPay, Inc.  https://bitpay.com/
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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-08 Thread Peter Todd
On Fri, May 08, 2015 at 12:03:04PM +0200, Mike Hearn wrote:
 
   * Though there are many proposals floating around which could
  significantly decrease block propagation latency, none of them are
  implemented today.
 
 
 With a 20mb cap, miners still have the option of the soft limit.

The soft-limit is there miners themselves produce smaller blocks; the
soft-limit does not prevent other miners from producing larger blocks.

As we're talking about ways that other miners can use 20MB blocks to
harm the competition, talking about the soft-limit is irrelevant.
Similarly, as security engineers we must plan for the worst case; as
we've seen before by your campaigns to raise the soft-limit(1) even at a
time when the vast majority of transaction volume was from one user
(SatoshiDice) soft-limits are an extremely weak form of control.

For the proposes of discussing blocksize increase requirements we can
stop talking about the soft-limit.

1) https://bitcointalk.org/index.php?topic=149668.0

-- 
'peter'[:-1]@petertodd.org
09344ba165781ee352f93d657c8b098c8e518e6011753e59


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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-08 Thread Tier Nolan
On Fri, May 8, 2015 at 5:37 PM, Peter Todd p...@petertodd.org wrote:

 The soft-limit is there miners themselves produce smaller blocks; the
 soft-limit does not prevent other miners from producing larger blocks.


I wonder if having a miner flag would be good for the network.

Clients for general users and merchants would have a less strict rule than
the rule for miners.  Miners who don't set their miners flag might get
orphaned off the chain.

For example, the limits could be setup as follows.

Clients: 20MB
Miners: 4MB

When in miner mode, the client would reject 4MB blocks and wouldn't build
on them.  The reference client might even track the miner and the non-miner
chain tip.

Miners would refuse to build on 5MB blocks, but merchants and general users
would accept them.

This allows the miners to soft fork the limit at some point in the future.
If 75% of miners decided to up the limit to 8MB, then all merchants and the
general users would accept the new blocks.  It could follow the standard
soft fork rules.

This is a more general version of the system where miners are allowed to
vote on the block size (subject to a higher limit).

A similar system is where clients track all header trees.  Your wallet
could warn you that there is an invalid tree that has  75% of the hashing
power and you might want to upgrade.
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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Alan Reiner
Actually I believe that side chains and off-main-chain transactions will be
a critical part for the overall scalability of the network.  I was actually
trying to make the point that (insert some huge block size here) will be
needed to even accommodate the reduced traffic.

I believe that it is definitely over 20MB. If it was determined to be 100
MB ten years from now, that wouldn't surprise me.

Sent from my overpriced smartphone
On May 8, 2015 1:17 PM, Andrew onelinepr...@gmail.com wrote:



 On Fri, May 8, 2015 at 2:59 PM, Alan Reiner etothe...@gmail.com wrote:


 This isn't about everyone's coffee.  This is about an absolute minimum
 amount of participation by people who wish to use the network.   If our
 goal is really for bitcoin to really be a global, open transaction network
 that makes money fluid, then 7tps is already a failure.  If even 5% of the
 world (350M people) was using the network for 1 tx per month (perhaps to
 open payment channels, or shift money between side chains), we'll be above
 100 tps.  And that doesn't include all the non-individuals (organizations)
 that want to use it.


 The goals of a global transaction network and everyone must be able to
 run a full node with their $200 dell laptop are not compatible.  We need
 to accept that a global transaction system cannot be fully/constantly
 audited by everyone and their mother.  The important feature of the network
 is that it is open and anyone *can* get the history and verify it.  But not
 everyone is required to.   Trying to promote a system wher000e the history
 can be forever handled by a low-end PC is already falling out of reach,
 even with our miniscule 7 tps.  Clinging to that goal needlessly limits the
 capability for the network to scale to be a useful global payments system


 These are good points and got me thinking (but I think you're wrong). If
 we really want each of the 10 billion people soon using bitcoin once per
 month, that will require 500MB blocks. That's about 2 TB per month. And if
 you relay it to 4 peers, it's 10 TB per month. Which I suppose is doable
 for a home desktop, so you can just run a pruned full node with all
 transactions from the past month. But how do you sync all those
 transactions if you've never done this before or it's been a while since
 you did? I think it currently takes at least 3 hours to fully sync 30 GB of
 transactions. So 2 TB will take 8 days, then you take a bit more time to
 sync the days that passed while you were syncing. So that's doable, but at
 a certain point, like 10 TB per month (still only 5 transactions per month
 per person), you will need 41 days to sync that month, so you will never
 catch up. So I think in order to keep the very important property of anyone
 being able to start clean and verify the thing, then we need to think of
 bitcoin as a system that does transactions for a large number of users at
 once in one transaction, and not a system where each person will make a
 ~monthly transaction on. We need to therefore rely on sidechains,
 treechains, lightning channels, etc...

 I'm not a bitcoin wizard and this is just my second post on this mailing
 list, so I may be missing something. So please someone, correct me if I'm
 wrong.




 On 05/07/2015 03:54 PM, Jeff Garzik wrote:

  On Thu, May 7, 2015 at 3:31 PM, Alan Reiner etothe...@gmail.com wrote:


  (2) Leveraging fee pressure at 1MB to solve the problem is actually
 really a bad idea.  It's really bad while Bitcoin is still growing, and
 relying on fee pressure at 1 MB severely impacts attractiveness and
 adoption potential of Bitcoin (due to high fees and unreliability).  But
 more importantly, it ignores the fact that for a 7 tps is pathetic for a
 global transaction system.  It is a couple orders of magnitude too low for
 any meaningful commercial activity to occur.  If we continue with a cap of
 7 tps forever, Bitcoin *will* fail.  Or at best, it will fail to be
 useful for the vast majority of the world (which probably leads to
 failure).  We shouldn't be talking about fee pressure until we hit 700 tps,
 which is probably still too low.

  [...]

  1) Agree that 7 tps is too low

  2) Where do you want to go?  Should bitcoin scale up to handle all the
 world's coffees?

  This is hugely unrealistic.  700 tps is 100MB blocks, 14.4 GB/day --
 just for a single feed.  If you include relaying to multiple nodes, plus
 serving 500 million SPV clients en grosse, who has the capacity to run such
 a node?  By the time we get to fee pressure, in your scenario, our network
 node count is tiny and highly centralized.

  3) In RE fee pressure -- Do you see the moral hazard to a software-run
 system?  It is an intentional, human decision to flood the market with
 supply, thereby altering the economics, forcing fees to remain low in the
 hopes of achieving adoption.  I'm pro-bitcoin and obviously want to see
 bitcoin adoption - but I don't want to sacrifice every decentralized
 principle and become a central 

Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Raystonn
Replace by fee is what I was referencing.  End-users interpret the old 
transaction as expired.  Hence the nomenclature.  An alternative is a new 
feature that operates in the reverse of time lock, expiring a transaction after 
a specific time.  But time is a bit unreliable in the blockchain

-Raystonn


On 8 May 2015 1:41 pm, Mark Friedenbach m...@friedenbach.org wrote:

 Transactions don't expire. But if the wallet is online, it can periodically 
 choose to release an already created transaction with a higher fee. This 
 requires replace-by-fee to be sufficiently deployed, however.

 On Fri, May 8, 2015 at 1:38 PM, Raystonn . rayst...@hotmail.com wrote:

 I have a proposal for wallets such as yours.  How about creating all 
 transactions with an expiration time starting with a low fee, then replacing 
 with new transactions that have a higher fee as time passes.  Users can pick 
 the fee curve they desire based on the transaction priority they want to 
 advertise to the network.  Users set the priority in the wallet, and the 
 wallet software translates it to a specific fee curve used in the series of 
 expiring transactions.  In this manner, transactions are never left hanging 
 for days, and probably not even for hours.

 -Raystonn

 On 8 May 2015 1:17 pm, Aaron Voisine vois...@gmail.com wrote:

 As the author of a popular SPV wallet, I wanted to weigh in, in support of 
 the Gavin's 20Mb block proposal.

 The best argument I've heard against raising the limit is that we need fee 
 pressure.  I agree that fee pressure is the right way to economize on 
 scarce resources. Placing hard limits on block size however is an 
 incredibly disruptive way to go about this, and will severely negatively 
 impact users' experience.

 When users pay too low a fee, they should:

 1) See immediate failure as they do now with fees that fail to propagate.

 2) If the fee lower than it should be but not terminal, they should see 
 degraded performance, long delays in confirmation, but eventual success. 
 This will encourage them to pay higher fees in future.

 The worst of all worlds would be to have transactions propagate, hang in 
 limbo for days, and then fail. This is the most important scenario to 
 avoid. Increasing the 1Mb block size limit I think is the simplest way to 
 avoid this least desirable scenario for the immediate future.

 We can play around with improved transaction selection for blocks and 
 encourage miners to adopt it to discourage low fees and create fee 
 pressure. These could involve hybrid priority/fee selection so low fee 
 transactions see degraded performance instead of failure. This would be the 
 conservative low risk approach.

 Aaron Voisine
 co-founder and CEO
 breadwallet.com


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Re: [Bitcoin-development] Block Size Increase (Raystonn)

2015-05-08 Thread Damian Gomez
Hello,

I was reading some of the thread but can't say I read the entire thing.

I think that it is realistic to cinsider a nlock sixe of 20MB for any block
txn to occur. THis is an enormous amount of data (relatively for a netwkrk)
in which the avergage rate of 10tps over 10 miniutes would allow for
fewasible transformation of data at this curent point in time.

Though I do not see what extra hash information would be stored in the
overall ecosystem as we begin to describe what the scripts that are
atacrhed tp the blockchain would carry,

I'd therefore think that for the remainder of this year that it is possible
to have a block chain within 200 - 300 bytes that is more charatereistic of
some feasible attempts at attaching nuanced data in order to keep propliifc
the blockchain but have these identifiers be integral OPSIg of the the
entiore block. THe reasoning behind this has to do with encryption
standards that can be added toe a chain such as th DH algoritnm keys that
would allow for a higher integrity level withinin the system as it is.
Cutrent;y tyh prootocl oomnly controls for the amount of transactions
through if TxnOut script and the publin key coming form teh lcoation of the
proof-of-work. Form this then I think that a rate of higher than then
current standard of 92bytes allows for GPUS ie CUDA to perfirm its standard
operations of  1216 flops   in rde rto mechanize a new personal identity
within the chain that also attaches an encrypted instance of a further
categorical variable that we can prsribved to it.

I think with the current BIP7 prootclol for transactions there is an area
of vulnerability for man-in-the-middle attacks upon request of  bitcin to
any merchant as is. It would contraidct the security of the bitcoin if it
was intereceptefd iand not allowed to reach tthe payment network or if the
hash was reveresed in orfr to change the value it had. Therefore the
current best fit block size today is between 200 - 300 bytws (depending on
how exciteed we get)



Thanks for letting me join the conversation
I welcomes any vhalleneged and will reply with more research as i figure
out what problems are revealed in my current formation of thoughts (sorry
for the errors but i am just trying to move forward --- THE DELRERT KEY
LITERALLY PREVENTS IT )


_Damian
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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Mark Friedenbach
Transactions don't expire. But if the wallet is online, it can periodically
choose to release an already created transaction with a higher fee. This
requires replace-by-fee to be sufficiently deployed, however.

On Fri, May 8, 2015 at 1:38 PM, Raystonn . rayst...@hotmail.com wrote:

 I have a proposal for wallets such as yours.  How about creating all
 transactions with an expiration time starting with a low fee, then
 replacing with new transactions that have a higher fee as time passes.
 Users can pick the fee curve they desire based on the transaction priority
 they want to advertise to the network.  Users set the priority in the
 wallet, and the wallet software translates it to a specific fee curve used
 in the series of expiring transactions.  In this manner, transactions are
 never left hanging for days, and probably not even for hours.

 -Raystonn
  On 8 May 2015 1:17 pm, Aaron Voisine vois...@gmail.com wrote:

 As the author of a popular SPV wallet, I wanted to weigh in, in support of
 the Gavin's 20Mb block proposal.

 The best argument I've heard against raising the limit is that we need fee
 pressure.  I agree that fee pressure is the right way to economize on
 scarce resources. Placing hard limits on block size however is an
 incredibly disruptive way to go about this, and will severely negatively
 impact users' experience.

 When users pay too low a fee, they should:

 1) See immediate failure as they do now with fees that fail to propagate.

 2) If the fee lower than it should be but not terminal, they should see
 degraded performance, long delays in confirmation, but eventual success.
 This will encourage them to pay higher fees in future.

 The worst of all worlds would be to have transactions propagate, hang in
 limbo for days, and then fail. This is the most important scenario to
 avoid. Increasing the 1Mb block size limit I think is the simplest way to
 avoid this least desirable scenario for the immediate future.

 We can play around with improved transaction selection for blocks and
 encourage miners to adopt it to discourage low fees and create fee
 pressure. These could involve hybrid priority/fee selection so low fee
 transactions see degraded performance instead of failure. This would be the
 conservative low risk approach.

 Aaron Voisine
 co-founder and CEO
 breadwallet.com



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 Widest out-of-the-box monitoring support with 50+ applications
 Performance metrics, stats and reports that give you Actionable Insights
 Deep dive visibility with transaction tracing using APM Insight.
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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Raystonn
Replace by fee is the better approach. It will ultimately replace zombie transactions (due to insufficient fee) with potentially much higher fees as the feature takes hold in wallets throughout the network, and fee competition increases. However, this does not fix the problem of low tps. In fact, as blocks fill it could make the problem worse. This feature means more transactions after all. So I would expect huge fee spikes, or a return to zombie transactions if fee caps are implemented by wallets.
-Raystonn

On 8 May 2015 1:55 pm, Mark Friedenbach m...@friedenbach.org wrote:The problems with that are larger than time being unreliable. It is no longer reorg-safe as transactions can expire in the course of a reorg and any transaction built on the now expired transaction is invalidated.On Fri, May 8, 2015 at 1:51 PM, Raystonn raystonn@hotmail.com wrote:Replace by fee is what I was referencing.  End-users interpret the old transaction as expired.  Hence the nomenclature.  An alternative is a new feature that operates in the reverse of time lock, expiring a transaction after a specific time.  But time is a bit unreliable in the blockchain
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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-08 Thread Peter Todd
On Fri, May 08, 2015 at 08:47:52PM +0100, Tier Nolan wrote:
 On Fri, May 8, 2015 at 5:37 PM, Peter Todd p...@petertodd.org wrote:
 
  The soft-limit is there miners themselves produce smaller blocks; the
  soft-limit does not prevent other miners from producing larger blocks.
 
 
 I wonder if having a miner flag would be good for the network.

Makes it trivial to find miners and DoS attack them - a huge risk to the
network as a whole, as well as the miners.

Right now pools already get DoSed all the time through their work
submission systems; getting DoS attacked via their nodes as well would
be a disaster.

 When in miner mode, the client would reject 4MB blocks and wouldn't build
 on them.  The reference client might even track the miner and the non-miner
 chain tip.
 
 Miners would refuse to build on 5MB blocks, but merchants and general users
 would accept them.

That'd be an excellent way to double-spend merchants, significantly
increasing the chance that the double-spend would succeed as you only
have to get sufficient hashing power to get the lucky blocks; you don't
need enough hashing power to *also* ensure those blocks don't become the
longest chain, removing the need to sybil attack your target.

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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Thomas Zander
On Wednesday 6. May 2015 21.49.52 Peter Todd wrote:
 I'm not sure if you've seen this, but a good paper on this topic was
 published recently: The Economics of Bitcoin Transaction Fees


The obvious flaw in this paper is that it talks about a block size in todays 
(trivial) data-flow economy and compares it with the zero-reward situation 
decades from now.

Its comparing two things that will never exist at the same time (unless 
Bitcoin fails).
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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Raystonn .
I have a proposal for wallets such as yours. How about creating all transactions with an expiration time starting with a low fee, then replacing with new transactions that have a higher fee as time passes. Users can pick the fee curve they desire based on the transaction priority they want to advertise to the network. Users set the priority in the wallet, and the wallet software translates it to a specific fee curve used in the series of expiring transactions. In this manner, transactions are never left hanging for days, and probably not even for hours.
-Raystonn

On 8 May 2015 1:17 pm, Aaron Voisine vois...@gmail.com wrote:As the author of a popular SPV wallet, I wanted to weigh in, in support of the Gavins 20Mb block proposal.The best argument Ive heard against raising the limit is that we need fee pressure.  I agree that fee pressure is the right way to economize on scarce resources. Placing hard limits on block size however is an incredibly disruptive way to go about this, and will severely negatively impact users experience.When users pay too low a fee, they should:1) See immediate failure as they do now with fees that fail to propagate.2) If the fee lower than it should be but not terminal, they should see degraded performance, long delays in confirmation, but eventual success. This will encourage them to pay higher fees in future.The worst of all worlds would be to have transactions propagate, hang in limbo for days, and then fail. This is the most important scenario to avoid. Increasing the 1Mb block size limit I think is the simplest way to avoid this least desirable scenario for the immediate future.We can play around with improved transaction selection for blocks and encourage miners to adopt it to discourage low fees and create fee pressure. These could involve hybrid priority/fee selection so low fee transactions see degraded performance instead of failure. This would be the conservative low risk approach.Aaron Voisineco-founder and CEObreadwallet.com
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Re: [Bitcoin-development] Block Size Increase

2015-05-08 Thread Mark Friedenbach
The problems with that are larger than time being unreliable. It is no
longer reorg-safe as transactions can expire in the course of a reorg and
any transaction built on the now expired transaction is invalidated.

On Fri, May 8, 2015 at 1:51 PM, Raystonn rayst...@hotmail.com wrote:

 Replace by fee is what I was referencing.  End-users interpret the old
 transaction as expired.  Hence the nomenclature.  An alternative is a new
 feature that operates in the reverse of time lock, expiring a transaction
 after a specific time.  But time is a bit unreliable in the blockchain

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn
Hey Matt,

OK, let's get started 

However, there hasnt been any discussion on this
 mailing list in several years as far as I can tell.


Probably because this list is not a good place for making progress or
reaching decisions. Those are triggered by pull requests (sometimes).

If you're wondering why now, that's probably my fault. A few days ago
Wladimir posted a release timeline. I observed to Wladimir and Gavin in
private that this timeline meant a change to the block size was unlikely to
get into 0.11, leaving only 0.12, which would give everyone only a few
months to upgrade in order to fork the chain by the end of the winter
growth season. That seemed tight.

Wladimir did not reply to this email, unfortunately. Perhaps he would like
the issue to go away. It won't - if Bitcoin continues on its current growth
trends it *will* run out of capacity, almost certainly by some time next
year.

What we need to see right now is leadership and a plan, that fits in the
available time window.


 Certainly a consensus in this kind of technical community should be a
 basic requirement for any serious commitment to blocksize increase.


I'm afraid I have come to disagree. I no longer believe this community can
reach consensus on anything protocol related. Some of these arguments have
dragged on for years. Consensus isn't even well defined - consensus of who?
Anyone who shows up? And what happens when, inevitably, no consensus is
reached? Stasis forever?


 Long-term incentive compatibility requires that there be some fee
 pressure, and that blocks be relatively consistently full or very nearly
 full.


I disagree. When the money supply eventually dwindles I doubt it will be
fee pressure that funds mining, but as that's a long time in the future,
it's very hard to predict what might happen.


 What we see today are
 transactions enjoying next-block confirmations with nearly zero pressure
 to include any fee at all (though many do because it makes wallet code
 simpler).


Many do because free transactions are broken - the relay limiter means
whether a free transaction actually makes it across the network or not is
basically pot luck and there's no way for a wallet to know, short of either
trying it or actually receiving every single transaction and repeating the
calculations. If free transactions weren't broken for all non-full nodes
they'd probably be used a lot more.


 This allows the well-funded Bitcoin ecosystem to continue building
 systems which rely on transactions moving quickly into blocks while
 pretending these systems scale.


I have two huge problems with this line of thinking.

Firstly, no, the Bitcoin ecosystem is not well funded. Blockstream might
be, but significant numbers of users are running programs developed by tiny
startups, or volunteers who don't have millions in venture capital to play
with.

Arm-twisting the ecosystem into developing complicated Rube Goldberg
machines in double quick time, just to keep the Bitcoin show on the road,
is in fact the opposite of decentralisation - it will effectively exclude
anyone who isn't able to raise large amounts of corporate funding from
writing code that uses the Bitcoin network. Decentralisation benefits from
simplicity, and bigger blocks are (in Gavin's words) the simplest thing
that will work.

My second problem is the claim that everyone is playing pretend about
Bitcoin, except you guys. I would put it another way - I would say those
people are building products and getting users, by making reasonable
engineering tradeoffs and using systems that work. Yes, one day those
systems might have to change. That's the nature of scaling. It's the nature
of progress. But not today. Probably not tomorrow either.

What I would like to see from Blockstream is a counter-proposal. So far you
have made lots of vague comments that we all agree with - yes,
decentralisation is good, yes some block size limit must exist, if only
because computers are finite machines.

What I don't see from you yet is a *specific and credible plan* that fits
within the next 12 months and which allows Bitcoin to keep growing. Not
some vague handwave like let's all use the Lightning network (which does
not exist), or let's do more research (Gavin has done plenty of
research), or but what about the risks (Bitcoin is full of risks). A
plan, with dates attached, and a strong chance of actually being deployed
in time.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Peter Todd
On Thu, May 07, 2015 at 12:59:13PM -0400, Gavin Andresen wrote:
 Fee dynamics seems to come up over and over again in these discussions,
 with lots of talk and theorizing.
 
 I hope some data on what is happening with fees right now might help, so I
 wrote another blog post (with graphs, which can't be done in a mailing list
 post):
http://gavinandresen.ninja/the-myth-of-not-full-blocks
 
 We don’t need 100% full one megabyte blocks to start to learn about what is
 likely to happen as transaction volume rises and/or the one megabyte block
 size limit is raised.

Sounds like you're saying we are bumping up against a 1MB limit. However
other than the occasional user who has sent a transaction with an
extremely low/no fee, what evidence do we have that this is or is not
actually impacting meaningful usage form the user's point of view?

Do we have evidence as to how users are coping? e.g. do they send time
sensitive transactiosn with higher fees? Are people conciously moving
low value transactions off the blockchain? Equally, what about the story
with companies? You of course are an advisor to Coinbase, and could give
us some insight into the type of planning payment processors/wallets are
doing.  For instance, does Coinbase have any plans to work with other
wallet providers/payment processors to aggregate fund transfers between
wallet providers - an obvious payment channel application.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn
 The only answer to this that anyone with a clue should give is it
 will very, very likely be able to support at least 1MB blocks roughly
 every 10 minutes on average for the next eleven years, and it seems
 likely that a block size increase of some form will happen at some point in
 the next eleven years, anything else is dishonest.


Matt, you know better than that. Gavin neither lacks clue nor is he
dishonest.

He has been working on the assumption that other developers are reasonable,
and some kind of compromise solution can be found that everyone can live
with. Hence trying to find a middle ground, hence considering and writing
articles in response to every single objection raised. Hence asking for
suggestions on what to change about the plan, to make it more acceptable.
What more do you want, exactly?

And I'll ask again. Do you have a *specific, credible alternative*? Because
so far I'm not seeing one.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
On Thu, May 7, 2015 at 3:31 PM, Alan Reiner etothe...@gmail.com wrote:

  (1) Blocks are essentially nearing full now.  And by full he means
 that the reliability of the network (from the average user perspective) is
 about to be impacted in a very negative way


Er, to be economically precise, full just means fees are no longer zero.
Bitcoin behaves as it always has.  It is no longer basically free to dump
spam into the blockchain, as it is today.

In the short term, blocks are bursty, with some on 1 minute intervals, some
with 60 minute intervals.  This does not change with larger blocks.



 (2) Leveraging fee pressure at 1MB to solve the problem is actually really
 a bad idea.  It's really bad while Bitcoin is still growing, and relying on
 fee pressure at 1 MB severely impacts attractiveness and adoption potential
 of Bitcoin (due to high fees and unreliability).  But more importantly, it
 ignores the fact that for a 7 tps is pathetic for a global transaction
 system.  It is a couple orders of magnitude too low for any meaningful
 commercial activity to occur.  If we continue with a cap of 7 tps forever,
 Bitcoin *will* fail.  Or at best, it will fail to be useful for the vast
 majority of the world (which probably leads to failure).  We shouldn't be
 talking about fee pressure until we hit 700 tps, which is probably still
 too low.

 [...]

1) Agree that 7 tps is too low

2) Where do you want to go?  Should bitcoin scale up to handle all the
world's coffees?

This is hugely unrealistic.  700 tps is 100MB blocks, 14.4 GB/day -- just
for a single feed.  If you include relaying to multiple nodes, plus serving
500 million SPV clients en grosse, who has the capacity to run such a
node?  By the time we get to fee pressure, in your scenario, our network
node count is tiny and highly centralized.

3) In RE fee pressure -- Do you see the moral hazard to a software-run
system?  It is an intentional, human decision to flood the market with
supply, thereby altering the economics, forcing fees to remain low in the
hopes of achieving adoption.  I'm pro-bitcoin and obviously want to see
bitcoin adoption - but I don't want to sacrifice every decentralized
principle and become a central banker in order to get there.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Chris Wardell
Instead of raising the block size to another static number like 20MB, can
we raise it dynamically?

Make the max block size something like:
pow(2, nHeight/10) * 1MB;  //double every ~2 years
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Alex Mizrahi
Just to add to the noise, did you consider linear growth?

Unlike exponential growth, it approximates diminishing returns (i.e. tech
advances become slower with time). And unlike single step, it will give
people time to adapt to new realities.

E.g. 2 MB in 2016, 3 MB in 2017 and so on.
So in 20 years we'll get to 20 MB which ought to be enough for anybody.
But if miners will find 20 MB blocks too overwhelming, they can limit it
through soft work, based on actual data.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
On Thu, May 7, 2015 at 3:03 PM, Matt Corallo bitcoin-l...@bluematt.me
wrote:
 More generally, consider the situation we're in now. Gavin is going off
 pitching this idea to the general public (which, I agree, is an
 important step in pulling off a hardfork) while people who actually
 study the issues are left wondering why they're being ignored (ie why is
 there no consensus-building happening on this list?).

This sub-thread threatens to veer off into he-said-she-said.

 If, instead, there had been an intro on the list as I think we should
 do the blocksize increase soon, what do people think?, the response
 could likely have focused much more around creating a specific list of
 things we should do before we (the technical community) think we are
 prepared for a blocksize increase.

Agreed, but that is water under the bridge at this point.  You - rightly -
opened the topic here and now we're discussing it.

Mike and Gavin are due the benefit of doubt because making a change to a
leaderless automaton powered by leaderless open source software is breaking
new ground.  I don't focus so much on how we got to this point, but rather,
where we go from here.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Matt Corallo
On 05/07/15 11:29, Mike Hearn wrote:
 Can you please elaborate on what terrible things will happen if we
 don't increase the block size by winter this year?
 
 
 I was referring to winter next year. 0.12 isn't scheduled until the end
 of the year, according to Wladimir. I explained where this figure comes
 from in this article:

On a related note, I'd like to agree strongly with Peter Todd that we
should get away from doing forks-only-in-releases. We can add code to do
a fork and then enable it in 0.11.1 or 0.11.11 if Gavin prefers more 11s.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jérémie Dubois-Lacoste
Any proposal to switch to a new hardcorded value so we have time to
*really* figure out later what's next and all implications, is a road
to a gigantic issue later when we want to switch to that next.

Sure we would have more time to think about, research all
implications, simulate, discuss, etc. But the ability then to agree
enough on a change to roll it out successfully will be much smaller,
because of the economy being built on top of Bitcoin being much larger
and the technical specifications of Bitcoin being closer to a complete
freeze.

What I'm trying to say is that we should look at long term lasting
solutions even if it takes more effort and time right now and puts the
network into some troubles for a while, because they're short term
troubles. (You define troubles, depending on which side you stand
at the moment...).

I personally believe in adaptive block size mechanisms, because:

(i) common sense tells me harcoding is never a solution for a system
whose usage is for many aspects unpredictable
(ii) we can't rely on human consensus to adapt it (seeing the mess
 it is already this time).

It would have the advantage to place this block size issue entirely as
part of the algorithmic contract you agree on when you use Bitcoin,
similar to the difficulty adapation or the block reward.


Jérémie


2015-05-07 21:37 GMT+02:00 Mike Hearn m...@plan99.net:

 These statements may even be true, but they're no logical conclusions
 even if they seem obvious to you.
 I don't think those claims are strictly true, specially because they
 involve predictions about what people will do.
 But if they're true they require some proof or at least some explanation.


 Thank you for your patience, Jorge.

 I have written up an explanation of what I think will happen if we run out
 of capacity:

https://medium.com/@octskyward/crash-landing-f5cc19908e32

 Now I'm going to go eat some dinner :)

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Bernard Rihn
It seems to me like some (maybe most) of the pressure is actually external
from companies that might release something that dramatically increases
adoption  transaction rates (and that the data on historic rate of
adoption  slumps is somewhat disconnected from their interests in a quick
roll-out)?

It seems like the question actually becomes what is our maximum acceptable
cost (hardware capex  bandwidth  power opex) associated with running a
full node without hardware acceleration and with hardware acceleration
(something which presumably doesn't exist yet)? Are we making the
assumption that hardware acceleration for confirmation will become broadly
available and that the primary limiter will become anonymous bandwidth?

Excuse my ignorance, but I imagine somebody must have already looked at
confirmation times vs. block size for various existing hardware platforms
(like at least 3 or 4? maybe a minnowboard, old laptop, and modern desktop
at least?)? Is there an easy way to setup bitcoind or some other script to
test this? (happy to help)

Re Moore's law: yeah, some say stuff like 5nm may never happen. We're
already using EUV with plasma emitters, immersed reflective optics, and
double-patterning... and in storage land switching to helium. Things may
slow A LOT over the next couple decades and I'd guess that a quadratic
increase (both in storage  compute) probably isn't a safe assumption.

On Thu, May 7, 2015 at 11:46 AM, Btc Drak btcd...@gmail.com wrote:

 On Thu, May 7, 2015 at 7:40 PM, Gavin Costin slashdevn...@hotmail.com
 wrote:

 Can anyone opposed to this proposal articulate in plain english the worst
 case scenario(s) if it goes ahead?

 Some people in the conversation appear to be uncomfortable, perturbed,
 defensive etc about the proposal …. But I am not seeing specifics on why it
 is not a feasible plan.


 See this response:
 http://www.mail-archive.com/bitcoin-development@lists.sourceforge.net/msg07462.html



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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Gavin Costin
Can anyone opposed to this proposal articulate in plain english the worst
case scenario(s) if it goes ahead?

Some people in the conversation appear to be uncomfortable, perturbed,
defensive etc about the proposal Š. But I am not seeing specifics on why it
is not a feasible plan.

From:  Mike Hearn m...@plan99.net
Date:  Friday, 8 May, 2015 2:06 am
To:  Btc Drak btcd...@gmail.com
Cc:  Bitcoin Dev bitcoin-development@lists.sourceforge.net
Subject:  Re: [Bitcoin-development] Block Size Increase

 I think you are rubbing against your own presupposition that people must find
 and alternative right now. Quite a lot here do not believe there is any
 urgency, nor that there is an immanent problem that has to be solved before
 the sky falls in.

I have explained why I believe there is some urgency, whereby some urgency
I mean, assuming it takes months to implement, merge, test, release and for
people to upgrade.

But if it makes you happy, imagine that this discussion happens all over
again next year and I ask the same question.


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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Justus Ranvier
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Hash: SHA1

On 05/07/2015 09:54 PM, Jeff Garzik wrote:
 By the time we get to fee pressure, in your scenario, our network 
 node count is tiny and highly centralized.

Again, this assertion requires proof.

Simply saying things is not the same as them being true.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jérémie Dubois-Lacoste
 I have written up an explanation of what I think will happen if we run out
 of capacity:

https://medium.com/@octskyward/crash-landing-f5cc19908e32
Looks like a solid description of what would happen.

I fail to see how this description wouldn't be applicable also to a
20MB-network in some time in the future, say ~3 years from now, if
Bitcoin keeps taking off.
If you agree that it will be harder in the future to change the block
limit again, and we switch to hardcoded 20MB, then aren't we just
going from an immediate relief to a future larger blockage?




 Now I'm going to go eat some dinner :)

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Btc Drak
On Thu, May 7, 2015 at 6:43 PM, Mike Hearn m...@plan99.net wrote:

 And I'll ask again. Do you have a *specific, credible alternative*?
 Because so far I'm not seeing one.


I think you are rubbing against your own presupposition that people must
find and alternative right now. Quite a lot here do not believe there is
any urgency, nor that there is an immanent problem that has to be solved
before the sky falls in.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Ross Nicoll
I'm presuming that schedule is just an example, as you'd end up with 
insanely large block sizes in a few years.


Absolutely, yes, an increase schedule is an option if people agree on 
it, and I think the better option, as the current limit too low, but 
jumping straight to a value big enough for indefinitely is a huge jump.


Gave some thought to scaling block size based on transaction fees, but 
suspect it would end up with miners sending huge fees to themselves with 
transactions that aren't relayed (so they only are actioned if they make 
it into a block that miner mines) to make the network allow bigger blocks.


Ross

On 07/05/2015 19:38, Chris Wardell wrote:
Instead of raising the block size to another static number like 20MB, 
can we raise it dynamically?


Make the max block size something like:
pow(2, nHeight/10) * 1MB;  //double every ~2 years



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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Alan Reiner
This *is* urgent and needs to be handled right now, and I believe Gavin
has the best approach to this.  I have heard Gavin's talks on increasing
the block size, and the two most persuasive points to me were:

(1) Blocks are essentially nearing full now.  And by full he means
that the reliability of the network (from the average user perspective)
is about to be impacted in a very negative way (I believe it was due to
the inconsistent time between blocks).  I think Gavin said that his
simulations showed 400 kB - 600 kB worth of transactions per 10 min
(approx 3-4 tps) is where things start to behave poorly for certain
classes of transactions.  In other words, we're very close to the
effective limit in terms of maintaining the current standard of
living, and with a year needed to raise the block time this actually is
urgent.

(2) Leveraging fee pressure at 1MB to solve the problem is actually
really a bad idea.  It's really bad while Bitcoin is still growing, and
relying on fee pressure at 1 MB severely impacts attractiveness and
adoption potential of Bitcoin (due to high fees and unreliability).  But
more importantly, it ignores the fact that for a 7 tps is pathetic for a
global transaction system.  It is a couple orders of magnitude too low
for any meaningful commercial activity to occur.  If we continue with a
cap of 7 tps forever, Bitcoin *will* fail.  Or at best, it will fail to
be useful for the vast majority of the world (which probably leads to
failure).  We shouldn't be talking about fee pressure until we hit 700
tps, which is probably still too low. 

You can argue that side chains and payment channels could alleviate
this.  But how far off are they?  We're going to hit effective 1MB
limits long before we can leverage those in a meaningful way.  Even if
everyone used them, getting a billion people onto the system just can't
happen even at 1 transaction per year per person to get into a payment
channel or move money between side chains.

We get asked all the time by corporate clients about scalability.  A
limit of 7 tps makes them uncomfortable that they are going to invest
all this time into a system that has no chance of handling the economic
activity that they expect it handle.  We always assure them that 7 tps
is not the final answer. 

Satoshi didn't believe 1 MB blocks were the correct answer.  I
personally think this is critical to Bitcoin's long term future.   And
I'm not sure what else Gavin could've done to push this along in a
meaninful way.

-Alan


On 05/07/2015 02:06 PM, Mike Hearn wrote:

 I think you are rubbing against your own presupposition that
 people must find and alternative right now. Quite a lot here do
 not believe there is any urgency, nor that there is an immanent
 problem that has to be solved before the sky falls in.


 I have explained why I believe there is some urgency, whereby some
 urgency I mean, assuming it takes months to implement, merge, test,
 release and for people to upgrade.

 But if it makes you happy, imagine that this discussion happens all
 over again next year and I ask the same question.



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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jorge Timón
On Thu, May 7, 2015 at 6:59 PM, Gavin Andresen gavinandre...@gmail.com wrote:
 Fee dynamics seems to come up over and over again in these discussions, with
 lots of talk and theorizing.

 I hope some data on what is happening with fees right now might help, so I
 wrote another blog post (with graphs, which can't be done in a mailing list
 post):
http://gavinandresen.ninja/the-myth-of-not-full-blocks

 We don’t need 100% full one megabyte blocks to start to learn about what is
 likely to happen as transaction volume rises and/or the one megabyte block
 size limit is raised.

Ok, the fact that the fee increases the probability of getting
included faster already is a good thing, the graphs with the
probability of getting included in the next block were less important
to me.
Although scarce space (beyond what miners chose to limit by
themselves) would increase the fee competition, I didn't knew that
there is actually some competition happening already.
So I guess this diminishes the argument for maintaining the limits
longer to observe the results of more scarce space.
Still, I think maintaining a lower policy limit it's a good idea, even
if we decide not to use it to observe that soon.
For example, say we chose the 20 MB consensus limit, we can maintain
the policy limit at 1 MB or move it to 2 MB, and slowly moving it up
later as needed without requiring everyone to upgrade.
Of course, not all miners have to follow the standard policy, but at
least it's something.
So please take this as a suggestion to improve your proposal. You can
argue it like this if we want to maintain the limits after the
hardfork or increase them slowly, for observing fee dynamics with more
scarce space or for any other reason, those limits can be partially
enforced by the standard policy. I mean, I think that could be a
reasonable compromise for that concrete line of arguments.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn

 I think you are rubbing against your own presupposition that people must
 find and alternative right now. Quite a lot here do not believe there is
 any urgency, nor that there is an immanent problem that has to be solved
 before the sky falls in.


I have explained why I believe there is some urgency, whereby some
urgency I mean, assuming it takes months to implement, merge, test,
release and for people to upgrade.

But if it makes you happy, imagine that this discussion happens all over
again next year and I ask the same question.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn
 These statements may even be true, but they're no logical conclusions
 even if they seem obvious to you.
 I don't think those claims are strictly true, specially because they
 involve predictions about what people will do.
 But if they're true they require some proof or at least some explanation.


Thank you for your patience, Jorge.

I have written up an explanation of what I think will happen if we run out
of capacity:

   https://medium.com/@octskyward/crash-landing-f5cc19908e32

Now I'm going to go eat some dinner :)
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Ross Nicoll
Can I just add my own support for this - as has been stated elsewhere in 
this discussion, hard forks are difficult, and risky. The earlier we 
have a decision, and the earlier the change goes into the code, the 
easier that is.


Even if the decision was the actual block size change is fine to leave 
until 2020, I'd like to see the code committed ASAP so that every new 
install, and every upgrade from there on gets the new version.


My personal opinion only is that 7 transactions a second is insanely 
limited even if the main chain does nothing but act as a backbone 
between other chains and transaction networks. I don't think that's 
overly controversial. I think 2016 is too early for a 20mb block size, 
though. I'm inclined to suggest a schedule of expansion, say to 2mb in 
2016, 4mb in 2018, 8mb in 2020 and 20mb in 2022 where it stops. The 
intent would be to provide enough size pressure to motivate scaling 
work, while not limiting Bitcoin overly.


Further, I think this highlights that we need more work on fees. Right 
now fees and transactions included are fairly naive, but I'd like to see 
the absolute block size limit as a hard upper bound, with miners 
imposing soft limits based on a balance cost of storage, number of 
outputs vs inputs (and therefore impact on the UTXOs), and risk of 
orphan blocks to determine which transactions are actually worth 
including in each block. If anyone has numbers on block size vs orphan 
rate that would be really useful, BTW.


Ross

On 07/05/2015 19:06, Mike Hearn wrote:


I think you are rubbing against your own presupposition that
people must find and alternative right now. Quite a lot here do
not believe there is any urgency, nor that there is an immanent
problem that has to be solved before the sky falls in.


I have explained why I believe there is some urgency, whereby some 
urgency I mean, assuming it takes months to implement, merge, test, 
release and for people to upgrade.


But if it makes you happy, imagine that this discussion happens all 
over again next year and I ask the same question.




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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Btc Drak
On Thu, May 7, 2015 at 7:40 PM, Gavin Costin slashdevn...@hotmail.com
wrote:

 Can anyone opposed to this proposal articulate in plain english the worst
 case scenario(s) if it goes ahead?

 Some people in the conversation appear to be uncomfortable, perturbed,
 defensive etc about the proposal …. But I am not seeing specifics on why it
 is not a feasible plan.


See this response:
http://www.mail-archive.com/bitcoin-development@lists.sourceforge.net/msg07462.html
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Matt Corallo
Replies inline.

On 05/07/15 17:43, Mike Hearn wrote:
 The only answer to this that anyone with a clue should give is it
 will very, very likely be able to support at least 1MB blocks
 roughly every 10 minutes on average for the next eleven years, and
 it seems likely that a block size increase of some form will happen
 at some point in the next eleven years, anything else is dishonest.
 
 
 Matt, you know better than that. Gavin neither lacks clue nor is he
 dishonest. 

No, I dont think Gavin is being deliberately dishonest, and I'm rather
confident he phrased everything in a way that is technically true (ie
the quote in his response). However, others have definitely not taken
away the correct interpretation of what he said, and this is a serious
problem. Setting expectations correctly as this is a very contentious
issue and one that does not appear to be reaching consensus quickly in
the technical community is important.
More generally, consider the situation we're in now. Gavin is going off
pitching this idea to the general public (which, I agree, is an
important step in pulling off a hardfork) while people who actually
study the issues are left wondering why they're being ignored (ie why is
there no consensus-building happening on this list?).


 He has been working on the assumption that other developers are
 reasonable, and some kind of compromise solution can be found that
 everyone can live with. Hence trying to find a middle ground, hence
 considering and writing articles in response to every single objection
 raised. Hence asking for suggestions on what to change about the plan,
 to make it more acceptable. What more do you want, exactly?

The appropriate method of doing any fork, that we seem to have been
following for a long time, is to get consensus here and on IRC and on
github and *then* go pitch to the general public (either directly or by
releasing software) that they should upgrade. I admit that hardforks are
a bit different in that the level of software upgrade required means
additional lead time, but I'm not sure that means starting the
public-pitching phase before there is any kind of consensus forming
(actually, I'd point out that to me there seems to be rahter clear
consensus outside of you and Gavin that we should delay increasing block
size).
As far as I can tell, there has been no discussion of block sizes on
this list since 2013, and while I know Gavin has had many private
conversations with people in this community about the block size, very
little if any of it has happened in public.
If, instead, there had been an intro on the list as I think we should
do the blocksize increase soon, what do people think?, the response
could likely have focused much more around creating a specific list of
things we should do before we (the technical community) think we are
prepared for a blocksize increase.

 And I'll ask again. Do you have a *specific, credible alternative*?
 Because so far I'm not seeing one.

A specific credible alternative to what? Committing to blocksize
increases tomorrow? Yes, doing more research into this and developing
software around supporting larger block sizes so people feel comfortable
doing it in six months. I acknowledge that Gavin has been putting a lot
of effort into this front, but, judging by this thread, I am far from
the only one who thinks much more needs done.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn

 The appropriate method of doing any fork, that we seem to have been
 following for a long time, is to get consensus here and on IRC and on
 github and *then* go pitch to the general public


So your concern is just about the ordering and process of things, and not
about the change itself?

I have witnessed many arguments in IRC about block sizes over the years.
There was another one just a few weeks ago. Pieter left the channel for his
own sanity. IRC is not a good medium for arriving at decisions on things -
many people can't afford to sit on IRC all day and conversations can be
hard to follow. Additionally, they tend to go circular.

That said, I don't know if you can draw a line between the ins and outs
like that. The general public is watching, commenting and deciding no
matter what. Might as well deal with that and debate in a format more
accessible to all.


 If, instead, there had been an intro on the list as I think we should
 do the blocksize increase soon, what do people think?


There have been many such discussions over time. On bitcointalk. On reddit.
On IRC. At developer conferences. Gavin already knew what many of the
objections would be, which is why he started answering them.

But alright. Let's say he should have started a thread. Thanks for starting
it for him.

Now, can we get this specific list of things we should do before we're
prepared?


 A specific credible alternative to what? Committing to blocksize
 increases tomorrow? Yes, doing more research into this and developing
 software around supporting larger block sizes so people feel comfortable
 doing it in six months.


Do you have a specific research suggestion? Gavin has run simulations
across the internet with modified full nodes that use 20mb blocks, using
real data from the block chain. They seem to suggest it works OK.

What software do you have in mind?
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Btc Drak
On Thu, May 7, 2015 at 5:11 PM, Mike Hearn m...@plan99.net wrote:

 Right now there is this nice warm fuzzy notion that decisions in Bitcoin
 Core are made by consensus. Controversial changes are avoided. I am
 trying to show you that this is just marketing.


Consensus is arrived when the people who are most active at the time
(active in contributing to discussions, code review, giving opinions etc.)
agreed to ACK. There are a regular staple of active contributors. Bitcoin
development is clearly a meritocracy. The more people participate and
contribute the more weight their opinions hold.


 Nobody can define what these terms even mean. It would be more accurate to
 say decisions are vetoed by whoever shows up and complains enough,
 regardless of technical merit. After all, my own getutxo change was merged
 after a lot of technical debate (and trolling) . then unmerged a day
 later because it's a shitstorm.


I am not sure that is fair, your PR was reverted because someone found a
huge exploit in your PR enough to invalidate all your arguments used to get
it merged in the first place.


 So if Gavin showed up and complained a lot about side chains or whatever,
 what you're saying is, oh that's different. We'd ignore him. But when
 someone else complains about a change they don't like, that's OK.

 Heck, I could easily come up with a dozen reasons to object to almost any
 change, if I felt like it. Would I then be considered not a part of the
 consensus because that'd be convenient?


I don't think it's as simple as that. Objections for the sake of
objections, or unsound technical objections are going to be seen for what
they are. This is a project with of some of the brightest people in the
world in this field. Sure people can be disruptive but their reputation
stand the test of time.

The consensus system might not be perfect, but it almost feels like you
want to declare a state of emergency and suspend all the normal review
process for this proposed hard fork.
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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-07 Thread Joseph Poon
Hi Matt,

I agree that starting discussion on how to approach this problem is
necessary and it's difficult taking positions without details on what is
being discussed.

A simple hard 20-megabyte increase will likely create perverse
incentives, perhaps a method can exist with some safe transition. I
think ultimately, the underlying tension with this discussion is about
the relative power of miners. Any transition of blocksize increase will
increase the influence of miners, and it is about understanding the
tradeoffs for each possible approach.

On Thu, May 07, 2015 at 10:02:09PM +, Matt Corallo wrote:
  * I'd like to see some better conclusions to the discussion around
 long-term incentives within the system. If we're just building Bitcoin
 to work in five years, great, but if we want it all to keep working as
 subsidy drops significantly, I'd like a better answer than we'll deal
 with it when we get there or it will happen, all the predictions based
 on people's behavior today say so (which are hopefully invalid thanks
 to the previous point). Ideally, I'd love to see some real free pressure
 already on the network starting to develop when we commit to hardforking
 in a year. Not just full blocks with some fees because wallets are
 including far greater fees than they really need to, but software which
 properly handles fees across the ecosystem, smart fee increases when
 transactions arent confirming (eg replace-by-fee, which could be limited
 to increase-in-fees-only for those worried about double-spends).

I think the long-term fee incentive structure needs to be significantly
more granular. We've all seen miners and pools take the path of least
resistance; often they just do whatever the community tells them to
blindly. While this status quo can change in the future, I think
designing sane defaults is a good path for any possible transition.

It seems especially reasonable to maintain fee pressure for normal
transactions during a hard-fork transition. It's possible to do so using
some kind of soft-cap structure. Building in a default soft-cap of 1
megabyte for some far future scheduled fork would seem like a sane thing
to do for bitcoin-core.

It seems also viable to be far more aggressive. What's your (and the
community's) opinion on some kind of coinbase voting protocol for
soft-cap enforcement? It's possible to write in messages to the coinbase
for a enforcible soft-cap that orphans out any transaction which
violates these rules. It seems safest to have the transition has the
first hardforked block be above 1MB, however, the next block default to
an enforced 1MB block. If miners agree to go above this, they must vote
in their coinbase to do so.

There's a separate discussion about this starting on:
cae-z3oxnjayluehbu0hdwu5pkrj6fpj7yptgbmq7hkxg3sj...@mail.gmail.com

I think defaulting some kind of mechanism on reading the coinbase seems
to be a good idea, I think left alone, miners may not do so. That way,
it's possible to have your cake and eat it too, fee pressure will still
exist, while block sizes can increase (provided it's in the miners'
greater interests to do so).

The Lightning Network's security model in the long-term may rely on a
multi-tier soft-cap, but I'm not sure. If 2nd order systemic miner
incentives were not a concern, a system which has an enforced soft-cap
and permits breaching that soft-cap with some agreed upon much higher
fee would work best. LN works without this, but it seems to be more
secure if some kind of miner consensus rule is reached regarding
prioritizing behavior of 2nd-layer consensus states.

No matter how it's done, certain aspects of the security model of
something like Lightning is reliant upon having block-space
availability for transactions to enter into the blockchain in a timely
manner (since deprecated channel states become valid again after some
agreed upon block-time).

I think pretty much everyone agrees that the 1MB block cap will
eventually be a problem. While people may disagree with when that will
be and how it'll play out, I think we're all in agreement that
discussion about it is a good idea, especially when it comes to
resolving blocking concerns.

Starting a discussion on how a hypothetical blocksize increase will
occur and the necessary blocking/want-to-have features/tradeoffs seems
to be a great way to approach this problem. The needs for Lightning
Network may be best optimized by being able to prioritizing a large mass
of timeout transactions at once (when a well-connected node stops
communicating).

-- 
Joseph Poon

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Tom Harding
On 5/7/2015 12:54 PM, Jeff Garzik wrote:
 In the short term, blocks are bursty, with some on 1 minute intervals, 
 some with 60 minute intervals.  This does not change with larger blocks.


I'm pretty sure Alan meant that blocks are already filling up after long 
inter-block intervals.



 2) Where do you want to go?  Should bitcoin scale up to handle all the 
 world's coffees?

Alan was very clear.  Right now, he wants to go exactly where Gavin's 
concrete proposal suggests.



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Re: [Bitcoin-development] Block Size Increase Requirements

2015-05-07 Thread Peter Todd
On Thu, May 07, 2015 at 10:02:09PM +, Matt Corallo wrote:
 OK, so lets do that. I've seen a lot of I'm not entirely comfortable
 with committing to this right now, but think we should eventually, but
 not much I'd be comfortable with committing to this when I see X. In
 the interest of ignoring debate and pushing people towards a consensus
 at all costs, ( ;) ) I'm gonna go ahead and suggest we talk about the
 second.
 
 Personally, there are several things that worry me significantly about
 committing to a blocksize increase, which I'd like to see resolved
 before I'd consider supporting a blocksize increase commitment.
 
  * Though there are many proposals floating around which could
 significantly decrease block propagation latency, none of them are
 implemented today. I'd expect to see these not only implemented but
 being used in production (though I dont particularly care about them
 being all that stable). I'd want to see measurements of how they perform
 both in production and in the face of high packet loss (eg across the
 GFW or in the case of small/moderate DoS). In addition, I'd expect to
 see analysis of how these systems perform in the worst-case, not just
 packet-loss-wise, but in the face of miners attempting to break the system.

It's really important that we remember that we're building security
software: it *must* hold up well even in the face of attack. That means
we need to figure out how it can be attacked, what the cost/profits of
such attacks are, and if the holes can be patched.  Just testing the
software with simulated loads is insufficient.

Also, re: breaking, don't forget that this may not be a malicious act.
For instance, someone can send contradictory transactions to different
parts of the network simultaneously to prevent mempool consistency -
there's no easy way to fix this. There are also cases where miners have
different policy than others, e.g. version disagreements, commercial
contracts for tx mining, etc.

Finally, remember that it's not in miners' incentives in many situations
for their blocks to propagate to more than ~30% of the hashing power.(1)

Personally, I'm really skeptical that we'll ever find a block
propagation latency reduction technique that sucesfully meets all the
above criteria without changing the consensus algorithm itself.


* How do we ensure miners don't cheat and stop validating blocks fully
before building on them? This is a significant moral hazard with larger
blocks if fees don't become significant, and can lead to dangerous
forks. Also, think of the incentives: Why would a miner ever switch from
the longest chain, even if they don't actually have the blocks to back
it up?

* We need a clear understanding of how we expect new full nodes, pruned
or not, to sync up to the blockchain. Obviously 20MB blocks
significantly increases the time and data required to sync. Are we
planning on simply giving up on full validation and trusting others for
copies of UTXO sets? Are we going to rely on UTXO commitments? What
happens if the UTXO set size itself increases greatly?

  * I'd very much like to see someone working on better scaling
 technology, both in terms of development and in terms of getting
 traction in the marketplace. I know StrawPay is working on development,
 though its not obvious to me how far they are from their website, but I
 dont know of any commitments by large players (either SPV wallets,
 centralized wallet services, payment processors, or any others) to
 support such a system (to be fair, its probably too early for such
 players to commit to anything, since anything doesnt exist in public).

A good start would be for those players to commit to the general
principles of these systems; if they can't commit explain why.

For instance I'd be very interested in knowing if services like Coinbase
see legal issues with adopting technologies such as payment channels
between hosted wallet providers, payment processors, etc. I certainly
wouldn't be surprised if they see doing anythign not on-blockchain as a
source of legal uncertainty - based on discussions I've had with
regulatory types in this space it sounds like there's a reasonable
chance protocol details such as requiring that transactions happen on a
public blockchain will be baked into regulatory requirements.

  * I'd like to see some better conclusions to the discussion around
 long-term incentives within the system. If we're just building Bitcoin
 to work in five years, great, but if we want it all to keep working as
 subsidy drops significantly, I'd like a better answer than we'll deal
 with it when we get there or it will happen, all the predictions based
 on people's behavior today say so (which are hopefully invalid thanks
 to the previous point). Ideally, I'd love to see some real free pressure
 already on the network starting to develop when we commit to hardforking
 in a year.

Agreed.

 Not just full blocks with some fees because wallets are
 including far greater fees 

Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread 21E14
I am more fazed by PR 5288 and PR 5925 not getting merged in, than by this
thread. So, casting my ballot in favor of the block size increase. Clearly,
we're still rehearsing proper discourse, and that ain't gonna get fixed
here and now.

On Thu, May 7, 2015 at 9:29 PM, Matt Corallo bitcoin-l...@bluematt.me
wrote:



 On 05/07/15 19:34, Mike Hearn wrote:
  The appropriate method of doing any fork, that we seem to have been
  following for a long time, is to get consensus here and on IRC and on
  github and *then* go pitch to the general public
 
 
  So your concern is just about the ordering and process of things, and
  not about the change itself?

 No, I'm very concerned about both.

  I have witnessed many arguments in IRC about block sizes over the years.
  There was another one just a few weeks ago. Pieter left the channel for
  his own sanity. IRC is not a good medium for arriving at decisions on
  things - many people can't afford to sit on IRC all day and
  conversations can be hard to follow. Additionally, they tend to go
 circular.

 I agree, thats why this mailing list was created in the first place
 (well, also because bitcointalk is too full of spam, but close enought :))

  That said, I don't know if you can draw a line between the ins and
  outs like that. The general public is watching, commenting and
  deciding no matter what. Might as well deal with that and debate in a
  format more accessible to all.

 Its true, just like its true the general public can opt to run any
 version of software they want. That said, the greater software
 development community has to update /all/ the software across the entire
 ecosystem, and thus provide what amounts to a strong recommendation of
 which course to take. Additionally, though there are issues (eg if there
 was a push to remove the total coin limit) which are purely political,
 and thus which should be up to the greater public to decide, the
 blocksize increase is not that. It is intricately tied to Bitcoin's
 delicate incentive structure, which many of the development community
 are far more farmiliar with than the general Bitcoin public. If there
 were a listserv that was comprised primarily of people on
 #bitcoin-wizards, I might have suggested a discussion there, first, but
 there isnt (as far as I know?).

  If, instead, there had been an intro on the list as I think we
 should
  do the blocksize increase soon, what do people think?
 
 
  There have been many such discussions over time. On bitcointalk. On
  reddit. On IRC. At developer conferences. Gavin already knew what many
  of the objections would be, which is why he started answering them.
 
  But alright. Let's say he should have started a thread. Thanks for
  starting it for him.
 
  Now, can we get this specific list of things we should do before we're
  prepared?

 YesI'm gonna split the topic since this is already far off course
 for that :).

  A specific credible alternative to what? Committing to blocksize
  increases tomorrow? Yes, doing more research into this and developing
  software around supporting larger block sizes so people feel
 comfortable
  doing it in six months.
 
 
  Do you have a specific research suggestion? Gavin has run simulations
  across the internet with modified full nodes that use 20mb blocks, using
  real data from the block chain. They seem to suggest it works OK.
 
  What software do you have in mind?

 Let me answer that in a new thread :).


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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Joel Joonatan Kaartinen
Having observed the customer support nightmare it tends to cause for a
small exchange service when 100% full blocks happen, I've been thinking
that the limit really should be dynamic and respond to demand and the
amount of fees offered. It just doesn't feel right when it takes ages to
burn through the backlog when 100% full is hit for a while. So, while
pondering this, I got an idea that I think has a chance of working that I
can't remember seeing suggested anywhere.

How about basing the maximum valid size for a block on the total bitcoin
days destroyed in that block? That should still stop transaction spam but
naturally expand the block size when there's a backlog of real
transactions. It'd also provide for an indirect mechanism for increasing
the maximum block size based on fees if there's a lot of fees but little
bitcoin days destroyed. In such a situation there'd be incentive to pay
someone to spend an older txout to expand the maximum. I realize this is a
rather half baked idea, but it seems worth considering.

- Joel

On Thu, May 7, 2015 at 10:31 PM, Alan Reiner etothe...@gmail.com wrote:

  This *is* urgent and needs to be handled right now, and I believe Gavin
 has the best approach to this.  I have heard Gavin's talks on increasing
 the block size, and the two most persuasive points to me were:

 (1) Blocks are essentially nearing full now.  And by full he means
 that the reliability of the network (from the average user perspective) is
 about to be impacted in a very negative way (I believe it was due to the
 inconsistent time between blocks).  I think Gavin said that his simulations
 showed 400 kB - 600 kB worth of transactions per 10 min (approx 3-4 tps) is
 where things start to behave poorly for certain classes of transactions.
 In other words, we're very close to the effective limit in terms of
 maintaining the current standard of living, and with a year needed to
 raise the block time this actually is urgent.

 (2) Leveraging fee pressure at 1MB to solve the problem is actually really
 a bad idea.  It's really bad while Bitcoin is still growing, and relying on
 fee pressure at 1 MB severely impacts attractiveness and adoption potential
 of Bitcoin (due to high fees and unreliability).  But more importantly, it
 ignores the fact that for a 7 tps is pathetic for a global transaction
 system.  It is a couple orders of magnitude too low for any meaningful
 commercial activity to occur.  If we continue with a cap of 7 tps forever,
 Bitcoin *will* fail.  Or at best, it will fail to be useful for the vast
 majority of the world (which probably leads to failure).  We shouldn't be
 talking about fee pressure until we hit 700 tps, which is probably still
 too low.

 You can argue that side chains and payment channels could alleviate this.
 But how far off are they?  We're going to hit effective 1MB limits long
 before we can leverage those in a meaningful way.  Even if everyone used
 them, getting a billion people onto the system just can't happen even at 1
 transaction per year per person to get into a payment channel or move money
 between side chains.

 We get asked all the time by corporate clients about scalability.  A limit
 of 7 tps makes them uncomfortable that they are going to invest all this
 time into a system that has no chance of handling the economic activity
 that they expect it handle.  We always assure them that 7 tps is not the
 final answer.

 Satoshi didn't believe 1 MB blocks were the correct answer.  I personally
 think this is critical to Bitcoin's long term future.   And I'm not sure
 what else Gavin could've done to push this along in a meaninful way.

 -Alan



 On 05/07/2015 02:06 PM, Mike Hearn wrote:

 I think you are rubbing against your own presupposition that people
 must find and alternative right now. Quite a lot here do not believe there
 is any urgency, nor that there is an immanent problem that has to be solved
 before the sky falls in.


  I have explained why I believe there is some urgency, whereby some
 urgency I mean, assuming it takes months to implement, merge, test,
 release and for people to upgrade.

  But if it makes you happy, imagine that this discussion happens all over
 again next year and I ask the same question.



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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn

 Can you please elaborate on what terrible things will happen if we
 don't increase the block size by winter this year?


I was referring to winter next year. 0.12 isn't scheduled until the end of
the year, according to Wladimir. I explained where this figure comes from
in this article:

https://medium.com/@octskyward/bitcoin-s-seasonal-affective-disorder-35733bab760d

It's a fairly simple estimate based on previous growth patterns.

Because I love wild guesses and mine is that full 1 MB blocks will not
 happen until June 2017.


OK, it could be. But do you think this debate will play out significantly
differently if you are right, I am wrong, and we have this discussion next
summer instead? Because in several years of watching these debates, I
haven't seen much change in them.


 We've successfully reached consensus for several softfork proposals
 already.


Are you sure about that?

What if Gavin popped up right now and said he disagreed with every current
proposal, he disagreed with side chains too, and there would be no
consensus on any of them until the block size limit was raised.

Would you say, oh, OK, guess that's it then. There's no consensus so might
as well scrap all those proposals, as they'll never happen anyway. Bye bye
side chains whitepaper.



 I just hope that by  What we need to see right now is leadership you
 don't mean something like when Gaving and Mike agree it's enough to
 deploy a hardfork when you go from vague to concrete.


No. What I meant is that someone (theoretically Wladimir) needs to make a
clear decision. If that decision is Bitcoin Core will wait and watch the
fireworks when blocks get full, that would be showing leadership .
albeit I believe in the wrong direction. It would, however, let people know
what's what and let them start to make longer term plans.

This dillydallying around is an issue - people just make vague points that
can't really be disagreed with (more nodes would be nice, smaller pools
would also be nice etc), and nothing gets done.


 no bitcoin long term it's broken long term but that's far away in the
 future so let's just worry about the present.


I never said Bitcoin is broken in the long term. Far from it - I laid out
my ideas for what will happen when the block subsidy dwindles years ago.

But yes, it's hard for me to care overly much about what happens 30 years
from now, for the same reason you probably care more about what happens
tomorrow than what happens after you are dead. The further into the future
you try and plan, the less likely your plans are to survive unscathed.


 What you want to avoid at all cost (the block size actually being
 used), I see as the best opportunity we have to look into the future.


I think I see one of the causes of disagreement now.

I will write more on the topic of what will happen if we hit the block size
limit soon, maybe this evening. I have some other tasks to do first.

Regardless, I don't believe we will get any useful data out of such an
event. I've seen distributed systems run out of capacity before. What will
happen instead is technological failure followed by rapid user abandonment
that pushes traffic back below the pressure threshold  and those users
will most likely not come back any time soon.


 Ok, this is my plan: we wait 12 months, hope that your estimations are
 correct (in case that my guess was better than yours, we keep waiting
 until June 2017) and start having full blocks and people having to
 wait 2 blocks for their transactions to be confirmed some times.


I disagree that'd be the outcome, but good, this is progress. Now we need
to hear something like that from Wladimir, or whoever has the final say
around here.

With respect to the fee market: I think it's fairer to say Gavin wants a
market to exist, and he also wants supply to be plentiful. 20mb limit
doesn't actually mean every block will be 20mb the day after, no more than
they're all 1mb today. Miners may discover that if they go beyond 5mb they
have too many orphans and then propagation speed will have to be optimised
to break through the next bottleneck. Scaling is always about finding the
next bottleneck and removing it, ideally, before you hit it.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jorge Timón
On Thu, May 7, 2015 at 1:29 PM, Mike Hearn m...@plan99.net wrote:
 I was referring to winter next year. 0.12 isn't scheduled until the end of
 the year, according to Wladimir. I explained where this figure comes from in
 this article:

 https://medium.com/@octskyward/bitcoin-s-seasonal-affective-disorder-35733bab760d

 It's a fairly simple estimate based on previous growth patterns.

Ok, thanks.

 We've successfully reached consensus for several softfork proposals
 already.


 Are you sure about that?

Yes, Peter Todd gave more details.

 What if Gavin popped up right now and said he disagreed with every current
 proposal, he disagreed with side chains too, and there would be no consensus
 on any of them until the block size limit was raised.

 Would you say, oh, OK, guess that's it then. There's no consensus so might
 as well scrap all those proposals, as they'll never happen anyway. Bye bye
 side chains whitepaper.

Well, yes, it is true that universally uncontroversial (which is
what I think the requirement should be for hard forks) is a vague
qualifier that's not formally defined anywhere.
I guess we should only consider rational arguments. You cannot just
nack something without further explanation.
If his explanation was I will change my mind after we increase block
size, I guess the community should say then we will just ignore your
nack because it makes no sense.
In the same way, when people use fallacies (purposely or not) we must
expose that and say this fallacy doesn't count as an argument.
But yeah, it would probably be good to define better what constitutes
a sensible objection or something. That doesn't seem simple though.

 I just hope that by  What we need to see right now is leadership you
 don't mean something like when Gaving and Mike agree it's enough to
 deploy a hardfork when you go from vague to concrete.


 No. What I meant is that someone (theoretically Wladimir) needs to make a
 clear decision. If that decision is Bitcoin Core will wait and watch the
 fireworks when blocks get full, that would be showing leadership .
 albeit I believe in the wrong direction. It would, however, let people know
 what's what and let them start to make longer term plans.

 This dillydallying around is an issue - people just make vague points that
 can't really be disagreed with (more nodes would be nice, smaller pools
 would also be nice etc), and nothing gets done.

Well, there's two different things here.
One thing is the Bitcoin core project where you could argue that the 5
committers decide (I don't know why Wladimir would have any more
authority than the others).
But what the bitcoin network itself does it's very different because
unlike the bitcoin core software project, the Bitcoin network is
decentralized.
If the people with commit access go nuts and decide something that's
clearly stupid or evil, people can just fork the project because it is
free software.
You cannot be forced to use specific features of free software, you
can always remove them and recompile, that's the whole point.
So, no, there's no authority to decide on hardforks and that's why I
think that only clearly uncontroversial things can get through as
hardforks.

 What you want to avoid at all cost (the block size actually being
 used), I see as the best opportunity we have to look into the future.


 I think I see one of the causes of disagreement now.

 I will write more on the topic of what will happen if we hit the block size
 limit soon, maybe this evening. I have some other tasks to do first.

 Regardless, I don't believe we will get any useful data out of such an
 event. I've seen distributed systems run out of capacity before. What will
 happen instead is technological failure followed by rapid user abandonment
 that pushes traffic back below the pressure threshold  and those users
 will most likely not come back any time soon.

Ok, so in simple terms, you expect people to have to pay enormous fees
and/or wait thousands of blocks for their transactions to get included
in the chain.
Is that correct?

 Ok, this is my plan: we wait 12 months, hope that your estimations are
 correct (in case that my guess was better than yours, we keep waiting
 until June 2017) and start having full blocks and people having to
 wait 2 blocks for their transactions to be confirmed some times.


 I disagree that'd be the outcome, but good, this is progress. Now we need to
 hear something like that from Wladimir, or whoever has the final say around
 here.

As said above there's no authority to decide on what Bitcoin the p2p
network does. Again, that's the whole point.
But, yes, I agree that both sides understanding each other better is progress.

 With respect to the fee market: I think it's fairer to say Gavin wants a
 market to exist, and he also wants supply to be plentiful. 20mb limit
 doesn't actually mean every block will be 20mb the day after, no more than
 they're all 1mb today. Miners may discover that if they go beyond 5mb 

Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Peter Todd
On Thu, May 07, 2015 at 11:25:04AM +0200, Mike Hearn wrote:
  Certainly a consensus in this kind of technical community should be a
  basic requirement for any serious commitment to blocksize increase.
 
 
 I'm afraid I have come to disagree. I no longer believe this community can
 reach consensus on anything protocol related. Some of these arguments have
 dragged on for years. Consensus isn't even well defined - consensus of who?
 Anyone who shows up? And what happens when, inevitably, no consensus is
 reached? Stasis forever?

Care to be specific?

We've made lots of protocol related changes, as well as non-consensus
policy changes, often in quite short timeframes, and with little drama.
For instance BIP66 adopting is progressing smoothly, and itself was very
quickly developed as part of a broader response to a serious OpenSSL
flaw. My own BIP65 is getting wide consensus with little drama and good
peer review, and that's happening even without as much attention paid to
it from myself as I should have been giving it. The BIP62 malleability
softfork is going more slowly, but that's because peer review is finding
issues and fixing them - something to be expected in an environment
where we simply must be cautious.

As for the v0.11 release, it will have pruning, perhaps the biggest
change to the way Bitcoin Core works that we've ever made. Equally it's
notable how many people collaborated on the implementation of pruning,
again with little drama.

Sure, some stuff has been hard to get consensus on. But those things
carry high risks, and involve code and practices known to be dangerous.
In most cases we've found out the lack of consensus was spot on, and
controversial changes turn out later to have severe security
vulnerabilities. I read that as a sign that the peer review and
consensus building process works just fine.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Andrew
I'm mainly just an observer on this. I mostly agree with Pieter. Also, I
think the main reason why people like Gavin and Mike Hearn are trying to
rush this through is because they have some kind of apps that depend on
zero conf instant transactions, so this would of course require more
traffic on the blockchain. I think people like Gavin or Mike should state
clearly what kind of (rigorous) system for instant transactions is
satisfactory for use in their applications. Be it lightning or something
similar, what is good enough? And no zero conf is not a real secure system.
Then once we know what is good enough for them (and everyone else), we can
implement it as a soft fork into the protocol, and it's a win win situation
for both sides (we can also benefit from all the new users people like Mike
are trying bring in).

On Thu, May 7, 2015 at 10:52 AM, Jorge Timón jti...@jtimon.cc wrote:

 On Thu, May 7, 2015 at 11:25 AM, Mike Hearn m...@plan99.net wrote:
  I observed to Wladimir and Gavin in private that this timeline meant a
 change to the block size was unlikely to get into 0.11, leaving only 0.12,
 which would give everyone only a few months to upgrade in order to fork the
 chain by the end of the winter growth season. That seemed tight.

 Can you please elaborate on what terrible things will happen if we
 don't increase the block size by winter this year?
 I assume that you are expecting full blocks by then, have you used any
 statistical technique to come up with that date or is it just your
 guess?
 Because I love wild guesses and mine is that full 1 MB blocks will not
 happen until June 2017.

  What we need to see right now is leadership and a plan, that fits in the
  available time window.
 
 
  Certainly a consensus in this kind of technical community should be a
  basic requirement for any serious commitment to blocksize increase.
 
 
  I'm afraid I have come to disagree. I no longer believe this community
 can
  reach consensus on anything protocol related. Some of these arguments
 have
  dragged on for years. Consensus isn't even well defined - consensus of
 who?
  Anyone who shows up? And what happens when, inevitably, no consensus is
  reached? Stasis forever?

 We've successfully reached consensus for several softfork proposals
 already.
 I agree with others that hardfork need to be uncontroversial and there
 should be consensus about them.
 If you have other ideas for the criteria for hardfork deployment all I'm
 ears.
 I just hope that by  What we need to see right now is leadership you
 don't mean something like when Gaving and Mike agree it's enough to
 deploy a hardfork when you go from vague to concrete.


  Long-term incentive compatibility requires that there be some fee
  pressure, and that blocks be relatively consistently full or very nearly
  full.
 
 
  I disagree. When the money supply eventually dwindles I doubt it will be
 fee
  pressure that funds mining, but as that's a long time in the future, it's
  very hard to predict what might happen.

 Oh, so your answer to bitcoin will eventually need to live on fees
 and we would like to know more about how it will look like then it's
 no bitcoin long term it's broken long term but that's far away in the
 future so let's just worry about the present.
 I agree that it's hard to predict that future, but having some
 competition for block space would actually help us get more data on a
 similar situation to be able to predict that future better.
 What you want to avoid at all cost (the block size actually being
 used), I see as the best opportunity we have to look into the future.

  What we see today are
  transactions enjoying next-block confirmations with nearly zero pressure
  to include any fee at all (though many do because it makes wallet code
  simpler).
 
 
  Many do because free transactions are broken - the relay limiter means
  whether a free transaction actually makes it across the network or not is
  basically pot luck and there's no way for a wallet to know, short of
 either
  trying it or actually receiving every single transaction and repeating
 the
  calculations. If free transactions weren't broken for all non-full nodes
  they'd probably be used a lot more.

 Free transactions are a gift from miners that run an altruistic policy.
 That's great but we shouldn't rely on them for the future. They will
 likely disappear at some point and that's ok.
 In any case, he's not complaining about the lack of free transactions,
 more like the opposite.
 He is saying that's very easy to get free transactions in the next
 block and blocks aren't full so there's no incentive to include fees
 to compete for the space.
 We can talk a lot about a fee market and build a theoretically
 perfect fee estimator but we won't actually have a fee market until
 there's some competition for space.
 Nobody will pay for space that's abundant just like people don't pay
 for the air they breath.

  What I don't see from you yet is a specific and 

Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Tom Harding
On 5/7/2015 7:09 PM, Jeff Garzik wrote:

 G proposed 20MB blocks, AFAIK - 140 tps
 A proposed 100MB blocks - 700 tps
 For ref,
 Paypal is around 115 tps
 VISA is around 2000 tps (perhaps 4000 tps peak)

 I ask again:  where do we want to go?   This is the existential
 question behind block size.

 Are we trying to build a system that can handle Paypal volumes?  VISA
 volumes?

 It's not a snarky or sarcastic question:  Are we building a system to
 handle all the world's coffees?  Is bitcoin's main chain and network -
 Layer 1 - going to receive direct connections from 500m mobile phones,
 broadcasting transactions?

 We must answer these questions to inform the change being discussed
 today, in order to decide what makes the most sense as a new limit. 
 Any responsible project of this magnitude must have a better story
 than zomg 1MB, therefore I picked 20MB out of a hat  Must be able to
 answer /why/ the new limit was picked.

 As G notes, changing the block size is simply kicking the can down the
 road:
 http://gavinandresen.ninja/it-must-be-done-but-is-not-a-panacea  
 Necessarily one must ask, today, what happens when we get to the end
 of that newly paved road.



Accepting that outcomes are less knowable further into the future is not
the same as failing to consider the future at all.  A responsible
project can't have a movie-plot roadmap.  It needs to give weight to
multiple possible future outcomes.
http://en.wikipedia.org/wiki/Decision_tree

One way or another, the challenge is to decide what to do next.  Beyond
that, it's future decisions all the way down. 

Alan argues that 7 tps is a couple orders of magnitude too low for any
meaningful commercial activity to occur, and too low to be the final
solution, even with higher layers.  I agree.  I also agree with you,
that we don't really know how to accomplish 700tps right now.

What we do know is if we want to bump the limit in the short term, we
ought to start now, and until there's a better alternative root to the
decision tree, it just might be time to get moving.




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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
On Thu, May 7, 2015 at 9:40 PM, Tom Harding t...@thinlink.com wrote:

 On 5/7/2015 12:54 PM, Jeff Garzik wrote:
  2) Where do you want to go?  Should bitcoin scale up to handle all the
  world's coffees?

 Alan was very clear.  Right now, he wants to go exactly where Gavin's
 concrete proposal suggests.


G proposed 20MB blocks, AFAIK - 140 tps
A proposed 100MB blocks - 700 tps
For ref,
Paypal is around 115 tps
VISA is around 2000 tps (perhaps 4000 tps peak)

I ask again:  where do we want to go?   This is the existential question
behind block size.

Are we trying to build a system that can handle Paypal volumes?  VISA
volumes?

It's not a snarky or sarcastic question:  Are we building a system to
handle all the world's coffees?  Is bitcoin's main chain and network -
Layer 1 - going to receive direct connections from 500m mobile phones,
broadcasting transactions?

We must answer these questions to inform the change being discussed today,
in order to decide what makes the most sense as a new limit.  Any
responsible project of this magnitude must have a better story than zomg
1MB, therefore I picked 20MB out of a hat  Must be able to answer /why/
the new limit was picked.

As G notes, changing the block size is simply kicking the can down the
road: http://gavinandresen.ninja/it-must-be-done-but-is-not-a-panacea
Necessarily one must ask, today, what happens when we get to the end of
that newly paved road.

-- 
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Bitcoin core developer and open source evangelist
BitPay, Inc.  https://bitpay.com/
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Peter Todd
On Thu, May 07, 2015 at 03:31:46PM -0400, Alan Reiner wrote:
 We get asked all the time by corporate clients about scalability.  A
 limit of 7 tps makes them uncomfortable that they are going to invest
 all this time into a system that has no chance of handling the economic
 activity that they expect it handle.  We always assure them that 7 tps
 is not the final answer. 

Your corporate clients, *why* do they want to use Bitcoin and what for
exactly?

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Tom Harding
On 5/7/2015 6:40 AM, Jorge Timón wrote:
 Known: There's a major problem looming for miners at the next block reward
 halving. Many are already in a bad place and without meaningful fees then
 sans a 2x increase in the USD:BTC ratio then many will simply have to leave
 the network, increasing centralisation risks. There seems to be a fairly
 pervasive assumption that the 300-ish MW of power that they currently use is
 going to pay for itself (ignoring capital and other operating costs).
 I take this as an argument for increasing fee competition and thus,
 against increasing the block size.


That doesn't follow.  Supposing average fees per transaction decrease
with block size, total fees / block reach an optimum somewhere.  While
the optimum might be at infinity, it's certainly not at zero, and it's
not at all obvious that the optimum is at a block size lower than 1MB.



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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
I have a lot more written down, a WIP; here are the highlights.

- The 1MB limit is an ancient anti-spam limit, and needs to go.

- The 1MB limit is economically entrenched at this point, and cannot be
removed at a whim.

- This is a major change to the economics of a $3.2B system.  This change
picks winners and losers.  There is attendant moral hazard.

- The core dev team is not and should not be an FOMC.

- The bar for major economic change to a $3.2B system should necessarily
be high.  In the more boring world of investments, this would accompanied
by Due Diligence including but not limited to projections for success,
failure scenarios, upside risks and downside risks.  Projections and
fact-based simulations.

- There are significant disruption risks on the pro (change it) and con
(keep 1MB) sides of the debate.

- People are privately lobbying Gavin for this.  That is the wrong way to
go.   I have pushed for a more public debate, and public endorsements (or
condemnations) from major miners, merchants, payment processors,
stackholders, ...   It is unfair to criticize Gavin to doing this.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Bryan Bishop
On Thu, May 7, 2015 at 9:05 AM, Mike Hearn m...@plan99.net wrote:
 Maybe you dislike that idea. It's so  centralised. So let's say Gavin
 commits his patch, because his authority is equal to all other committers.
 Someone else rolls it back. Gavin sets up a cron job to keep committing the
 patch. Game over.

 You cannot have committers fighting over what goes in and what doesn't.
 That's madness. There must be a single decision maker for any given
 codebase.

Hmm, git repositories don't quite work like that. Instead, you should
imagine everyone having a local copy of the git repository. Each
developer synchronizes their git repository with other developers.
They merge changes from specific remote branches that they have
received. Each developer has their own branch and each developer is
the single decision maker for the artifact that they compile.

- Bryan
http://heybryan.org/
1 512 203 0507

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Peter Todd
On Thu, May 07, 2015 at 04:05:41PM +0200, Mike Hearn wrote:
 Peter:   your hypocrisy really is bottomless, isn't it? You constantly
 claim to be a Righteous Defender of Privacy, but don't even hesitate before
 publishing hacked private emails when it suits you.

 Satoshi's hacker had no illusions about your horrible personality, which is
 why he forwarded that email to you specifically. He knew you'd use it. You
 should reflect on that fact. It says nothing good about you at all.

As you know I was forwarded that email first, and because I *do* respect
your privacy I consulting with you via private IRC chat first, and as
you wished I didn't publish it. The hacker presumably gave up waiting
for me to do so and published it themselves seven months ago; to make
that clear I linked the source(1) of the email in my message. Those
emails simply are no longer private.

Frankly personal attacks like this - your hypocrisy really is
bottomless, isn't it?, Satoshi's hacker had no illusions about your
horrible personality - simply don't belong on this mailing list and I
think we would all appreciate an apology.

1) https://www.reddit.com/r/Bitcoin/comments/2g9c0j/satoshi_email_leak/

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jorge Timón
On Thu, May 7, 2015 at 1:55 PM, Dave Hudson d...@hashingit.com wrote:
 Known: There has been a steady trend towards the mean block size getting
 larger. See
 https://blockchain.info/charts/avg-block-size?timespan=allshowDataPoints=falsedaysAverageString=7show_header=truescale=0address=

Looking at this graph and in retrospective, we shouldn't have removed
the standard policy limit without observing the supposedly disastrous
effects of hitting the limit first.
Removing the standard limit would have been trivial (bdb issues aside)
at any point after seeing the effects.

 Known: If we reach the point where all blocks are 1M bytes then there's a
 major problem in terms of transaction confirmation. I published an analysis
 of the impact of different mean block sizes against confirmation times:
 http://hashingit.com/analysis/34-bitcoin-traffic-bulletin. The current 35%
 to 45% mean block size doesn't have a huge impact on transaction
 confirmations (assuming equal fees for all) but once we're up at 80% then
 things start to get unpleasant. Instead of 50% of first confirmations taking
 about 7 minutes they instead take nearer to 19 minutes.

Well, this is only for first confirmations of free transaction.
A higher fee should increase your probabilities, but if you're sending
free transactions you may not care about them taking longer to be
included.

 Known: There are currently a reasonably large number of zero-fee
 transactions getting relayed and mined. If things start to slow down then
 there will be a huge incentive to delay them (or drop them altogether).

Well, maybe instant and free it's not a honest form of bitcoin
marketing and it just has to disappear.
Maybe we just need to start being more honest about pow being good for
processing micro-transactions: it is not.
Hopefully lightning will be good for that.
Free and fast in-chain transactions is something temporary that we
know will eventually disappear.
If people think it would be a adoption disaster that it happens soon,
then they could also detail an alternative plan to roll that out
instead of letting it happen.
But if the plan is to delay it forever...then I'm absolutely against.

 Known: There's a major problem looming for miners at the next block reward
 halving. Many are already in a bad place and without meaningful fees then
 sans a 2x increase in the USD:BTC ratio then many will simply have to leave
 the network, increasing centralisation risks. There seems to be a fairly
 pervasive assumption that the 300-ish MW of power that they currently use is
 going to pay for itself (ignoring capital and other operating costs).

I take this as an argument for increasing fee competition and thus,
against increasing the block size.

 Known: the orphan rate is still pretty-high even with everyone's fast
 connections. If we assume that 20M byte blocks become possible then that's
 likely to increase.

 Unknown: What are the security implications for larger blocks (this one (at
 least) can be simulated though)? For example, could large blocks with huge
 numbers of trivial transactions be used to put other validators at a
 disadvantage in a variant of a selfish mining attack? I've seen objections
 that such bad actors could be blacklisted in the future but it's not clear
 to me how. A private mining pool can trivially be made to appear like 100
 pools of 1% of the size without significantly affecting the economics of
 running that private mine.

No blacklisting, please, that's centralized.
In any case, a related known: bigger blocks give competitive advantage
to bigger miners.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn

 If his explanation was I will change my mind after we increase block

size, I guess the community should say then we will just ignore your
 nack because it makes no sense.


Oh good! We can just kick anyone out of the consensus process if we think
they make no sense.

I guess that means me and Gavin can remove everyone else from the developer
consensus, because we think trying to stop Bitcoin growing makes no sense.

Do you see the problem with this whole notion? It cannot possibly work.
Whenever you try and make the idea of developer consensus work, what you
end up with is I believe in consensus as long as it goes my way. Which is
worthless.


 One thing is the Bitcoin core project where you could argue that the 5
 committers decide (I don't know why Wladimir would have any more
 authority than the others).


Because he is formally the maintainer.

Maybe you dislike that idea. It's so  centralised. So let's say Gavin
commits his patch, because his authority is equal to all other committers.
Someone else rolls it back. Gavin sets up a cron job to keep committing the
patch. Game over.

You cannot have committers fighting over what goes in and what doesn't.
That's madness. There must be a single decision maker for any given
codebase.


 Ok, so in simple terms, you expect people to have to pay enormous fees
 and/or wait thousands of blocks for their transactions to get included
 in the chain. Is that correct?


No. I'll write an article like the others, it's better than email for more
complicated discourse.

As others have said, if the answer is forever, adoption is always the most
 important thing then we will end up with an improved version of Visa.


This appears to be another one of those fundamental areas of disagreement.
I believe there is no chance of Bitcoin ending up like Visa, even if it is
wildly successful. I did the calculations years ago that show that won't
happen:

https://en.bitcoin.it/wiki/Scalability

Decentralisation is a spectrum and Bitcoin will move around on that
spectrum over time. But claiming we have to pick between 1mb blocks and
Bitcoin = VISA is silly.



Peter:   your hypocrisy really is bottomless, isn't it? You constantly
claim to be a Righteous Defender of Privacy, but don't even hesitate before
publishing hacked private emails when it suits you.

Satoshi's hacker had no illusions about your horrible personality, which is
why he forwarded that email to you specifically. He knew you'd use it. You
should reflect on that fact. It says nothing good about you at all.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Matt Corallo


On 05/07/15 19:34, Mike Hearn wrote:
 The appropriate method of doing any fork, that we seem to have been
 following for a long time, is to get consensus here and on IRC and on
 github and *then* go pitch to the general public
 
 
 So your concern is just about the ordering and process of things, and
 not about the change itself?

No, I'm very concerned about both.

 I have witnessed many arguments in IRC about block sizes over the years.
 There was another one just a few weeks ago. Pieter left the channel for
 his own sanity. IRC is not a good medium for arriving at decisions on
 things - many people can't afford to sit on IRC all day and
 conversations can be hard to follow. Additionally, they tend to go circular.

I agree, thats why this mailing list was created in the first place
(well, also because bitcointalk is too full of spam, but close enought :))

 That said, I don't know if you can draw a line between the ins and
 outs like that. The general public is watching, commenting and
 deciding no matter what. Might as well deal with that and debate in a
 format more accessible to all.

Its true, just like its true the general public can opt to run any
version of software they want. That said, the greater software
development community has to update /all/ the software across the entire
ecosystem, and thus provide what amounts to a strong recommendation of
which course to take. Additionally, though there are issues (eg if there
was a push to remove the total coin limit) which are purely political,
and thus which should be up to the greater public to decide, the
blocksize increase is not that. It is intricately tied to Bitcoin's
delicate incentive structure, which many of the development community
are far more farmiliar with than the general Bitcoin public. If there
were a listserv that was comprised primarily of people on
#bitcoin-wizards, I might have suggested a discussion there, first, but
there isnt (as far as I know?).

 If, instead, there had been an intro on the list as I think we should
 do the blocksize increase soon, what do people think?
 
 
 There have been many such discussions over time. On bitcointalk. On
 reddit. On IRC. At developer conferences. Gavin already knew what many
 of the objections would be, which is why he started answering them.
 
 But alright. Let's say he should have started a thread. Thanks for
 starting it for him.
 
 Now, can we get this specific list of things we should do before we're
 prepared?

YesI'm gonna split the topic since this is already far off course
for that :).

 A specific credible alternative to what? Committing to blocksize
 increases tomorrow? Yes, doing more research into this and developing
 software around supporting larger block sizes so people feel comfortable
 doing it in six months. 
 
 
 Do you have a specific research suggestion? Gavin has run simulations
 across the internet with modified full nodes that use 20mb blocks, using
 real data from the block chain. They seem to suggest it works OK.
 
 What software do you have in mind?

Let me answer that in a new thread :).

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Alex Morcos
That strikes me as a dangerous path forward.

I don't actually think there is anything wrong with this: everybody
eventually gets tired of arguing angels-dancing-on-the-head-of-a-pin, and
we're left with the status quo

What gives Bitcoin value aren't its technical merits but the fact that
people believe in it.   The biggest risk here isn't that 20MB blocks will
be bad or that 1MB blocks will be bad, but that by forcing a hard fork that
isn't nearly universally agreed upon, we will be damaging that belief.   If
I strongly believed some hard fork would be better for Bitcoin, say
permanent inflation of 1% a year to fund mining, and I managed to convince
80% of users, miners, businesses and developers to go along with me, I
would still vote against doing it.  Because that's not nearly universal
agreement, and it changes what people chose to believe in without their
consent. Forks should be hard, very hard.  And both sides should recognize
that belief in the value of Bitcoin might be a fragile thing.   I'd argue
that if we didn't force through a 20MB fork now, and we ran into major
network difficulties a year from now and had no other technical solutions,
that maybe we would get nearly universal agreement, and the businesses and
users that were driven away by the unusable system would be a short term
loss in value considerably smaller than the impairment we risk by forcing a
change.



On Thu, May 7, 2015 at 10:52 AM, Gavin Andresen gavinandre...@gmail.com
wrote:

 For reference: the blog post that (re)-started this debate, and which
 links to individual issues, is here:
   http://gavinandresen.ninja/time-to-roll-out-bigger-blocks

 In it, I asked people to email me objections I might have missed. I would
 still appreciate it if people do that; it is impossible to keep up with
 this mailing list, /r/bitcoin posts and comments, and #bitcoin-wizards and
 also have time to respond thoughtfully to the objections raised.

 I would very much like to find some concrete course of action that we can
 come to consensus on. Some compromise so we can tell entrepreneurs THIS is
 how much transaction volume the main Bitcoin blockchain will be able to
 support over the next eleven years.

 I've been pretty clear on what I think is a reasonable compromise (a
 one-time increase scheduled for early next year), and I have tried to
 explain why I think it it is the right set of tradeoffs.

 There ARE tradeoffs here, and the hard question is what process do we use
 to decide those tradeoffs?  How do we come to consensus? Is it worth my
 time to spend hours responding thoughtfully to every new objection raised
 here, or will the same thing happen that happened last year and the year
 before-- everybody eventually gets tired of arguing
 angels-dancing-on-the-head-of-a-pin, and we're left with the status quo?

 I AM considering contributing some version of the bigger blocksize-limit
 hard-fork patch to the Bitcoin-Xt fork (probably  target a hobbyist with a
 fast Internet connection, and assume Nelson's law to increase over time),
 and then encouraging merchants and exchanges and web wallets and
 individuals who think it strikes a reasonable balance to run it.

 And then, assuming it became a super-majority of nodes on the network,
 encourage miners to roll out a soft-fork to start producing bigger blocks
 and eventually trigger the hard fork.

 Because ultimately consensus comes down to what software people choose to
 run.

 --
 --
 Gavin Andresen



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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn

 What gives Bitcoin value aren't its technical merits but the fact that
 people believe in it.


Much of the belief in Bitcoin is that it has a bright future. Certainly the
huge price spikes we've seen were not triggered by equally large spikes in
usage - it's speculation on that future.

I quite agree that if people stop believing in Bitcoin, that will be bad. A
fast way to bring that about will be to deliberately cripple the technology
in order to force people onto something quite different (which probably
won't be payment channel networks).


 I'd argue that if we didn't force through a 20MB fork now, and we ran into
 major network difficulties a year from now and had no other technical
 solutions, that maybe we would get nearly universal agreement


I doubt it. The disagreement seems more philosophical than technical. If
Bitcoin fell off a cliff then that'd just be taken as more evidence that
block chains don't work and we should all use some network of payment hubs,
or whatever the fashion of the day is. Or anyone who doesn't want to pay
high fees is unimportant. See all the other justifications Gavin is working
his way through on his blog.

That's why I conclude the opposite - if there is no fork, then people's
confidence in Bitcoin will be seriously damaged. If it's impossible to do
something as trivial as removing a temporary hack Satoshi put in place,
then what about bigger challenges? If the community is really willing to
drive itself off a cliff due to political deadlock, then why bother
building things that use Bitcoin at all?
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Justus Ranvier
-BEGIN PGP SIGNED MESSAGE-
Hash: SHA1

On 05/07/2015 05:04 PM, Jeff Garzik wrote:
 heh - I tend to think people here want bitcoin to succeed.  My
 statement refers to picking winners and losers from within the
 existing bitcoin community  stakeholders.

Success is not a sufficiently precise term in this context.

There is a large contingent of people for whom the definition of
Bitcoin success means serving as a stable backend which can meet the
needs of their non-Bitcoin platform - and nothing more.

To be extremely specific: should Bitcoin development intenionally
limit the network's capabilities to leave room for other projects, or
should Bitcoin attempt to be the best system possible and let the
other projects try to keep up as best they can?

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
On Thu, May 7, 2015 at 11:12 AM, Mike Hearn m...@plan99.net wrote:


 That's why I conclude the opposite - if there is no fork, then people's
 confidence in Bitcoin will be seriously damaged.


Yes, that is a possibility.



 If it's impossible to do something as trivial as removing a temporary hack
 Satoshi put in place, then what about bigger challenges?


This is absolutely not a trivial change.

It is a trivial *code* change.  It is not a trivial change to the economics
of a $3.2B system.

-- 
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
On Thu, May 7, 2015 at 11:16 AM, Justus Ranvier justusranv...@riseup.net
wrote:

 To be extremely specific: should Bitcoin development intenionally
 limit the network's capabilities to leave room for other projects, or
 should Bitcoin attempt to be the best system possible and let the
 other projects try to keep up as best they can?



Avoid such narrow, binary thinking.

Referencing the problem described in
http://gavinandresen.ninja/why-increasing-the-max-block-size-is-urgent
(not the solution - block size change - just the problem, tx/block Poisson
mismatch)

This problem - block creation is bursty - is fundamental to bitcoin.
Raising block size does not fix this problem (as [1] notes), but merely
kicks the can down the road a bit, by hiding it from users a bit longer.

Bitcoin is a settlement system, at the most fundamental engineering level.
It will never be an instant payment system for all the world's coffees (or
all the world's stock trades).  It is left to Layer 2 projects to
engineer around bitcoin's gaps, to produce an instant, secure, trustless,
egalitarian payment system using the bitcoin token.  [1] also notes this.

It is therefore not a binary decision of leaving room for other projects,
or not.  Layer-2 projects are critical to the success of bitcoin, and
complement bitcoin.






[1] http://gavinandresen.ninja/it-must-be-done-but-is-not-a-panacea

Holistic thinking implies you build a full-stack system with bitcoin
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
Yes - but you must recognize that is precisely 50% of the picture.

Others have made different assumptions - taking the [1MB-constrained]
market *as it exists today*, rather than in some projected future.

Raising the block size limit then becomes a *human decision* to favor some
users over others, a *human decision* to prevent an active and competitive
free fee market developing at 1MB, a *human decision* to keep transaction
fees low to incentivize bitcoin adoption, a *human decision* to value
adoption over decentralization.

These statements are not value judgements - not saying you are wrong -
these are observations of some rather huge, relevant blind spots in this
debate.





On Thu, May 7, 2015 at 11:29 AM, Mike Hearn m...@plan99.net wrote:

 It is a trivial *code* change.  It is not a trivial change to the
 economics of a $3.2B system.


 Hmm - again I'd argue the opposite.

 Up until now Bitcoin has been unconstrained by the hard block size limit.

 If we raise it, Bitcoin will continue to be unconstrained by it. That's
 the default continue as we are position.

 If it's not raised, then ... well, then we're in new territory
 entirely. Businesses built on the assumption that Bitcoin could become
 popular will suddenly have their basic assumptions invalidated. Users will
 leave. The technical code change would be zero, but the economic change
 would be significant.




-- 
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Bitcoin core developer and open source evangelist
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
Dear list,

Apparently my emails are being marked as spam, despite being sent from
GMail's web interface.  I've pinged our sysadmin.  Thanks for letting
me know.

-- 
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Bitcoin core developer and open source evangelist
BitPay, Inc.  https://bitpay.com/

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Btc Drak
On Thu, May 7, 2015 at 3:05 PM, Mike Hearn m...@plan99.net wrote:

 Maybe you dislike that idea. It's so  centralised. So let's say Gavin
 commits his patch, because his authority is equal to all other committers.
 Someone else rolls it back. Gavin sets up a cron job to keep committing the
 patch. Game over.

 You cannot have committers fighting over what goes in and what doesn't.
 That's madness. There must be a single decision maker for any given
 codebase.


You are conflating consensus with commit access. People with commit access
are maintainers who are *able to merge* pull requests. However, the rules
for bitcoin development are that only patches with consensus get merged. If
any of the maintainers just pushed a change without going through the whole
code review and consensus process there would be uproar, plain and simple.

Please don't conflate commit access with permission to merge because it's
just not the case. No-one can sidestep the requirement to get consensus,
not even the 5 maintainers.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
On Thu, May 7, 2015 at 11:33 AM, Justus Ranvier justusranv...@riseup.net
wrote:

 In summary, I asked a question neither you, nor Peter Todd, want to
 answer and want to actively discourage people from even asking at all.


Incorrect; your question included built-in assumptions with which I
disagree.

Bitcoin needs to be the best it can be (Layer 1), but all solutions cannot
and should not be implemented at Layer 1.

We need to scale up both bitcoin (L1) and solutions built on top of bitcoin
(L2).
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Justus Ranvier
-BEGIN PGP SIGNED MESSAGE-
Hash: SHA1

On 05/07/2015 05:47 PM, Jeff Garzik wrote:
 Bitcoin needs to be the best it can be (Layer 1), but all solutions
 cannot and should not be implemented at Layer 1.

I can provisionally agree with that statement as long as all
solutions cannot and should not be implemented at Layer 1 it taken to
be a hypothesis to be tested in the context of each proposed solution
rather than a law of nature.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Matthew Mitchell
In my personal opinion, this does make some sense to me, assuming I
understood Gavin.

I suppose it could be done with a new flag (like the P2SH flag) which
displays miner support for larger blocks. The new rules would apply when
a large majority of miners support the new rules by counting the number
of flagged blocks over a certain number of blocks on the network in a
deterministic fashion.

This way miners can continue to produce blocks which are supported by
both old and new clients. When it appears most people have migrated to
the new client, miners can start flagging support for the new rules, and
when a large majority of miners agree, the new rules would kick in for
all miners/clients running the new software. Miners could therefore glue
together the network during the migration phase until enough people have
updated to avoid severe fork scenarios. The only problem is ensuring
that miners will continue to support both networks for long enough to
enable successful migration.

And if too many people disagree to make a clean hard fork (too many
people stubbornly stick to the old rules), then it could be that the
hard fork is aborted and everyone goes back to the old rules, or quite
simply that the miners never give support for the new rules despite the
mechanism being included in the new client. In those cases it would be
as if nothing changed.

This way the hard fork would be determined by user participation as
judged by the miners.

If it is done, I can't think of a fairer way.

Matthew Mitchell

On 07/05/15 15:52, Gavin Andresen wrote:
 For reference: the blog post that (re)-started this debate, and which
 links to individual issues, is here:
   http://gavinandresen.ninja/time-to-roll-out-bigger-blocks
 
 In it, I asked people to email me objections I might have missed. I
 would still appreciate it if people do that; it is impossible to keep up
 with this mailing list, /r/bitcoin posts and comments, and
 #bitcoin-wizards and also have time to respond thoughtfully to the
 objections raised.
 
 I would very much like to find some concrete course of action that we
 can come to consensus on. Some compromise so we can tell entrepreneurs
 THIS is how much transaction volume the main Bitcoin blockchain will be
 able to support over the next eleven years.
 
 I've been pretty clear on what I think is a reasonable compromise (a
 one-time increase scheduled for early next year), and I have tried to
 explain why I think it it is the right set of tradeoffs.
 
 There ARE tradeoffs here, and the hard question is what process do we
 use to decide those tradeoffs?  How do we come to consensus? Is it worth
 my time to spend hours responding thoughtfully to every new objection
 raised here, or will the same thing happen that happened last year and
 the year before-- everybody eventually gets tired of arguing
 angels-dancing-on-the-head-of-a-pin, and we're left with the status quo?
 
 I AM considering contributing some version of the bigger blocksize-limit
 hard-fork patch to the Bitcoin-Xt fork (probably  target a hobbyist
 with a fast Internet connection, and assume Nelson's law to increase
 over time), and then encouraging merchants and exchanges and web wallets
 and individuals who think it strikes a reasonable balance to run it.
 
 And then, assuming it became a super-majority of nodes on the network,
 encourage miners to roll out a soft-fork to start producing bigger
 blocks and eventually trigger the hard fork.
 
 Because ultimately consensus comes down to what software people choose
 to run.
 
 -- 
 --
 Gavin Andresen
 
 
 
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn

 It is an argument against my admittedly vague definition of
 non-controversial change.


If it's an argument against something you said, it's not a straw man, right
;)

Consensus has to be defined as agreement between a group of people. Who are
those people? If you don't know, it's impossible to decide when there is
consensus or not.

Right now there is this nice warm fuzzy notion that decisions in Bitcoin
Core are made by consensus. Controversial changes are avoided. I am
trying to show you that this is just marketing. Nobody can define what
these terms even mean. It would be more accurate to say decisions are
vetoed by whoever shows up and complains enough, regardless of technical
merit. After all, my own getutxo change was merged after a lot of technical
debate (and trolling) . then unmerged a day later because it's a
shitstorm.

So if Gavin showed up and complained a lot about side chains or whatever,
what you're saying is, oh that's different. We'd ignore him. But when
someone else complains about a change they don't like, that's OK.

Heck, I could easily come up with a dozen reasons to object to almost any
change, if I felt like it. Would I then be considered not a part of the
consensus because that'd be convenient?


 I'm sure that's not what the proponents of the size increase want, and
 I'm not defending 1 MB as a sacred limit  or anything, but my question
 is where is the limit for them?


20mb is an arbitrary number, just like 1mb. It's good enough to keep the
Bitcoin ecosystem operating as it presently does: gentle growth in usage
with the technology that exists and is implemented. Gavin has discussed in
his blog why he chose 20mb, I think. It's the result of some estimates
based on average network/hardware capabilities.

Perhaps one day 20mb will not be enough. Perhaps then the limit will be
raised again, if there is sufficient demand.

You are correct that no limit at all is a possible answer. More
precisely, in that case miners would choose. Gavin's original proposal was
20mb+X where X is decided by some incrementing formula over time, chosen to
approximate expected improvements in hardware and software. That was cool
too. The 20mb figure and the formula were an attempt to address the
concerns of people who are worried about the block size increase:  a
meet-in-the-middle compromise.

Unfortunately it's hard to know what other kinds of meet-in-the-middle
compromise could be made here. I'm sure Gavin would consider them if he
knew. But the concerns provided are too vague to address. There are no
numbers in them, for example:

   - We need more research - how much more?
   - I'm not against changing the size, just not now - then when?
   - I'm not wedded to 1mb, but not sure 20mb is right - then what?
   - Full node count is going down - then what size do you think would fix
   that? 100kb?
   - It will make mining more centralised - how do you measure that and
   how much centralisation would you accept?

and so on.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Mike Hearn

 Dear list,

 Apparently my emails are being marked as spam, despite being sent from
 GMail's web interface.  I've pinged our sysadmin.


It's a problem with the mailing list software, not your setup. BitPay could
disable the phishing protections but that seems like a poor solution. The
only real fix is to send from a non @bitpay.com email address. Gmail or
Hotmail will work, I think. Yahoo won't: they enforce the same strict
policies than bitpay does.
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Justus Ranvier
-BEGIN PGP SIGNED MESSAGE-
Hash: SHA1

On 05/07/2015 03:35 PM, Jeff Garzik wrote:
 Raising the block size limit then becomes a *human decision* to
 favor some users over others, a *human decision* to prevent an
 active and competitive free fee market developing at 1MB, a *human
 decision* to keep transaction fees low to incentivize bitcoin
 adoption, a *human decision* to value adoption over
 decentralization.

At the moment none of the following assertions have been proven true,
yet are constantly cited as if they have been:

* A competitive fee market will develop when the transaction rate
becomes constrained by the block size limit
* More users of Bitcoin means less decentralization

Furthermore, the term decentralization is frequently used without
being precisely defined in a way that would allow for such proofs to
be debated.

If there's going to be a debate on those points, then the people
presenting points on both sides should take the time to show their
work and explain the methodology they used to reach their conclusions.

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jorge Timón
On Thu, May 7, 2015 at 4:52 PM, Gavin Andresen gavinandre...@gmail.com wrote:
 I would very much like to find some concrete course of action that we can
 come to consensus on. Some compromise so we can tell entrepreneurs THIS is
 how much transaction volume the main Bitcoin blockchain will be able to
 support over the next eleven years.

Mhmm, I hadn't thought about this. This makes sense and actually
explains the urgency on taking a decision better than anything else
I've heard.

On Thu, May 7, 2015 at 5:29 PM, Mike Hearn m...@plan99.net wrote:
 If it's not raised, then ... well, then we're in new territory entirely.
 Businesses built on the assumption that Bitcoin could become popular will
 suddenly have their basic assumptions invalidated. Users will leave. The
 technical code change would be zero, but the economic change would be
 significant.

This, on the other hand, is a non sequitur [1], another type of fallacy.
Well, several of them, actually:

- If it's not raised, then bitcoin cannot become popular
- If it's not raised, then users will leave
- Businesses built on the assumption that Bitcoin could become popular
were also assuming that it's going to be risen.

These statements may even be true, but they're no logical conclusions
even if they seem obvious to you.
I don't think those claims are strictly true, specially because they
involve predictions about what people will do.
But if they're true they require some proof or at least some explanation.

[1] http://en.wikipedia.org/wiki/Non_sequitur_(logic)#Affirming_the_consequent

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Justus Ranvier
-BEGIN PGP SIGNED MESSAGE-
Hash: SHA1

On 05/07/2015 04:04 PM, Jeff Garzik wrote:
 - This is a major change to the economics of a $3.2B system.  This
 change picks winners and losers.  There is attendant moral hazard.

This is exactly true.

There are a number of projects which aren't Bitcoin that benefit from
filling in the gap left by Bitcoin's restricted transaction rate
capability.

If Bitcoin fills that gap, Bitcoin wins and those other projects lose.

Should decisions about Bitcoin development take into account the
desires of competing projects?

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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
On Thu, May 7, 2015 at 10:38 AM, Justus Ranvier justusranv...@riseup.net
wrote:

 On 05/07/2015 04:04 PM, Jeff Garzik wrote:
  - This is a major change to the economics of a $3.2B system.  This
  change picks winners and losers.  There is attendant moral hazard.

 This is exactly true.

 There are a number of projects which aren't Bitcoin that benefit from
 filling in the gap left by Bitcoin's restricted transaction rate
 capability.

 If Bitcoin fills that gap, Bitcoin wins and those other projects lose.

 Should decisions about Bitcoin development take into account the
 desires of competing projects?


heh - I tend to think people here want bitcoin to succeed.  My statement
refers to picking winners and losers from within the existing bitcoin
community  stakeholders.

The existential question of the block size increase is larger - will
failing to increase the 1MB limit permanently stunt bitcoin's growth?
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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Peter Todd
On Thu, May 07, 2015 at 05:13:34PM +0200, Justus Ranvier wrote:
 On 05/07/2015 04:49 PM, Peter Todd wrote:
  
  I think we'll find an basic assumption of civility to be more 
  productive, until proven otherwise. (e.g. NSA ties)
 
 I'm not sure why you'd construe my post as having anything to do with
 accusations like NSA ties.

I'm not.

I'm saying dealing with someone with proven NSA ties is one of the few
times when I think the assumption of honest intent should be ignored in
this forum.

Altcoins and non-Bitcoin-blockchain tx systems? Assuming anything other
than honest intent isn't productive in this forum.

-- 
'peter'[:-1]@petertodd.org
0622ff7c71c105480baf123fe74df549b5a42596fd8bfbcb


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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Jeff Garzik
100% agree, RE hard forks should be hard.

However, it is the paradox of growth, morale and adoption that bitcoin
might never reach the point where it is saturated  expensive to the point
where larger blocks are demanded by 95%+...  simply because people and
companies chose not to adopt bitcoin in the first place due to an unmoving,
[perceived | real] scalability roadblock.


On Thu, May 7, 2015 at 11:04 AM, Alex Morcos mor...@gmail.com wrote:

 That strikes me as a dangerous path forward.

 I don't actually think there is anything wrong with this: everybody
 eventually gets tired of arguing angels-dancing-on-the-head-of-a-pin, and
 we're left with the status quo

 What gives Bitcoin value aren't its technical merits but the fact that
 people believe in it.   The biggest risk here isn't that 20MB blocks will
 be bad or that 1MB blocks will be bad, but that by forcing a hard fork that
 isn't nearly universally agreed upon, we will be damaging that belief.   If
 I strongly believed some hard fork would be better for Bitcoin, say
 permanent inflation of 1% a year to fund mining, and I managed to convince
 80% of users, miners, businesses and developers to go along with me, I
 would still vote against doing it.  Because that's not nearly universal
 agreement, and it changes what people chose to believe in without their
 consent. Forks should be hard, very hard.  And both sides should recognize
 that belief in the value of Bitcoin might be a fragile thing.   I'd argue
 that if we didn't force through a 20MB fork now, and we ran into major
 network difficulties a year from now and had no other technical solutions,
 that maybe we would get nearly universal agreement, and the businesses and
 users that were driven away by the unusable system would be a short term
 loss in value considerably smaller than the impairment we risk by forcing a
 change.



 On Thu, May 7, 2015 at 10:52 AM, Gavin Andresen gavinandre...@gmail.com
 wrote:

 For reference: the blog post that (re)-started this debate, and which
 links to individual issues, is here:
   http://gavinandresen.ninja/time-to-roll-out-bigger-blocks

 In it, I asked people to email me objections I might have missed. I would
 still appreciate it if people do that; it is impossible to keep up with
 this mailing list, /r/bitcoin posts and comments, and #bitcoin-wizards and
 also have time to respond thoughtfully to the objections raised.

 I would very much like to find some concrete course of action that we can
 come to consensus on. Some compromise so we can tell entrepreneurs THIS is
 how much transaction volume the main Bitcoin blockchain will be able to
 support over the next eleven years.

 I've been pretty clear on what I think is a reasonable compromise (a
 one-time increase scheduled for early next year), and I have tried to
 explain why I think it it is the right set of tradeoffs.

 There ARE tradeoffs here, and the hard question is what process do we use
 to decide those tradeoffs?  How do we come to consensus? Is it worth my
 time to spend hours responding thoughtfully to every new objection raised
 here, or will the same thing happen that happened last year and the year
 before-- everybody eventually gets tired of arguing
 angels-dancing-on-the-head-of-a-pin, and we're left with the status quo?

 I AM considering contributing some version of the bigger blocksize-limit
 hard-fork patch to the Bitcoin-Xt fork (probably  target a hobbyist with a
 fast Internet connection, and assume Nelson's law to increase over time),
 and then encouraging merchants and exchanges and web wallets and
 individuals who think it strikes a reasonable balance to run it.

 And then, assuming it became a super-majority of nodes on the network,
 encourage miners to roll out a soft-fork to start producing bigger blocks
 and eventually trigger the hard fork.

 Because ultimately consensus comes down to what software people choose to
 run.

 --
 --
 Gavin Andresen



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Re: [Bitcoin-development] Block Size Increase

2015-05-07 Thread Justus Ranvier
-BEGIN PGP SIGNED MESSAGE-
Hash: SHA1

On 05/07/2015 04:49 PM, Peter Todd wrote:
 
 I think we'll find an basic assumption of civility to be more 
 productive, until proven otherwise. (e.g. NSA ties)

I'm not sure why you'd construe my post as having anything to do with
accusations like NSA ties.

By non-Bitcoin projects I mean any altcoin or off-chain processing
solution.

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