7 ms·

Can you expound on why? I'm interested in hearing both sides of this.

cloakandswagger 10y ago
I've been an outside observer of the block size debate for a while now, so here is my naive take on it: The anti-block size increase camp says that increasing the block size is only a temporary fix, and that no blockchain can accommodate Visa levels of throughput. They also posit that any increase in the block size will make running a full node more difficult, meaning Bitcoin will become more and more centralized and consolidated around the big mining pools that have the hardware to handle bigger block sizes. However, many in the anti camp are pro segwit (segregated witness), a code change that does several things and is the first step to enabling off-chain networks like Lightning Network. These are basically pools of Bitcoins tracked by networks off the blockchain that would allow you to instantly exchange Bitcoins to anyone else in your network. This is a big problem for miners who have poured lots of money into their rigs, because now the blockchain would be little more than a settlement network. There would be far more transactions occurring off the network, meaning less money for miners. Again I'm no expert on this but this seems to be the crux of the debate. The Core developers seem to be OK with having the blockchain relegated to being a settlement network (similar to how Visa, your bank and merchants work together), but many people are opposed to this, partly because these off-chain networks would quickly form large central "hubs" which would obviate many of the benefits of Bitcoin (anonymity, privacy, security and decentralization).
- Laforet 10y ago
  I've also been keeping tabs on the debate and I agree with you except on one account: Not everyone want the Bitcoin to be the next Visa or Paypal, some are perfectly content with a 10 minute confirmation delay as long as the blockchain remains fully distributed and anonymous, whereas others see a business opportunity that could make themselves rich and influential down the line. The entire narrative about larger block making the network more centralised is a red herring. The network has been going in that direction for quite some time without a block size increase and in any case, going from 1MB to 2MB or even 16MB isn't going to change the economics of running a full node that much, which is to say there are no incentives for non-miners to host a full node at all, regardless of the alleged computing and network overhead (and worse, it can make you a more likely victim of DDoS attacks[0]). The entire point about keeping the 1MB limit (which was meant to be a temporary cap anyway) is to artificially create scarcity in transaction capacity and coerce people into accepting SegWit and eventually fully functional side chains. This is probably fine for those who believe that A. Bitcoin will become mainstream and B. the ends justify the means, but I find this to be a very unethical position to take. Disclaimer: I don't own a single cent in BTC, nor do I have association with anyone involved in the Bitcoin scene. [0]:http://www.financemagnates.com/cryptocurrency/news/the-latest-victims-of-ddos-attacks-banks-and-bitcoin-xt/ http://www.financemagnates.com/cryptocurrency/news/the-lates...
- notyourwork 10y ago
  >They also posit that any increase in the block size will make running a full node more difficult, meaning Bitcoin will become more and more centralized and consolidated around the big mining pools that have the hardware to handle bigger block sizes. With a bigger block size what hardware constraints begin to appear? > This is a big problem for miners who have poured lots of money into their rigs, because now the blockchain would be little more than a settlement network. There would be far more transactions occurring off the network, meaning less money for miners. So the motivation is strictly monetary?
  - pmorici 10y ago
    > With a bigger block size what hardware constraints begin to appear? Mostly it is an issue of disk space and network bandwidth. right now a 1 MB block is produced every 10 minutes. That has to be transferred over the network to every node and each so called "full node" has to store that block. The total size of the Bitcoin block chain for all time is currently ~100GB and grows 1 MB every 10 minutes under current conditions. If the block size grew too big that you couldn't transfer a block within the 10 minute space between blocks then your connection is too slow to run a node. On the disk space front you can run what is called a "prunning" node which discards older parts of the block chain that are no longer relevant which reduces disk space requirements greatly. There is also the issue of the initial blockchain download where when you are setting up a new node you have to download 100GB of historical block chain data to catch up to the current state of the network. These are all solvable problems though and Bitcoin's inventor envisioned that some day full nodes would be run out of data centers on heavy duty hardware. Small block supporters have argued that that hurts decentralization because some poor guy in Africa can't run a node on his Raspberry Pi and 3g internet if the block size gets much bigger. On the other hand if you are too poor to run a full node with a larger block size then you can hardly afford to pay huge transaction fees to transact on a network with a constricted block size so the whole argument that limiting the block size decreases centralization doesn't really hold water because in the end it limits user growth which is the ultimate decentralization mechanism. > So the motivation is strictly monetary? I think so. This whole stink started because some guy who happened to have a ton of BTC was upset that people running full nodes didn't get a cut of any of the transaction fees. Today, the main company that is pushing the Segwit / small block agenda hopes to push everyone to their off chain lightening network where they can collect the fees instead of the miners. Miners don't want to do anything that will jeopardize their profitability long term and keeping the block size too small limits their ability to control the supply of their product (block space).
- nadaviv 10y ago
  > partly because these off-chain networks would quickly form large central "hubs" which would obviate many of the benefits of Bitcoin The Lightning Network is open-source and decentralized. It has no "hubs", but rather just peers that route payments to each-other using a payment routing algorithm. Lightning has no counterparty risk, as no one can ever steal your bitcoins and you're always in full control. The best way to describe Lightning is as an write-cache layer. It improves the scalability properties of Bitcoin by many factors, makes micro- and nano- payments a reality, reduces fees to fractions of a cent, and even improves privacy (using a Tor-like onion routing for anonymized payments). https://www.youtube.com/watch?v=MpfvhiqFw7A https://www.youtube.com/watch?v=MpfvhiqFw7A https://bitcoinmagazine.com/articles/understanding-the-lightning-network-part-building-a-bidirectional-payment-channel-1464710791/ https://bitcoinmagazine.com/articles/understanding-the-light...
  - cloakandswagger 10y ago
    How do you counter the description of the network in this article? It seems like de-facto hubs will form out of necessity to avoid creating a channel on the fly, which requires getting a transaction committed to the blockchain. https://chrispacia.wordpress.com/2015/12/23/lightning-network-skepticism/ https://chrispacia.wordpress.com/2015/12/23/lightning-networ...
    - nadaviv 10y ago
      > Routing paths are much harder to find when values are considered. Hard, yes, but definitely possible. There was some great work done on P2P routing for Lightning by the developers at BitFury. http://bitfury.com/content/5-white-papers-research/whitepaper_flare_an_approach_to_routing_in_lightning_network_7_7_2016.pdf http://bitfury.com/content/5-white-papers-research/whitepape... > We could end up making more on-chain transactions ... Well, it will have to close one of its existing channels. So the process for making a transaction when your wallet can’t find a route is: 1) Make an on-chain transaction closing out an existing channel. 2) Make an on-chain transaction opening a new channel with the payee. This is not true. You can close an existing channel and open a new one in a single transaction. > The vast majority of users will be offline. Some will, some won't. Some will set this up on a VPS, some will use hosted services, some will be professional liquidity providers (early adopters with lots of coins?) that have a machine dedicated to this. He's making a prediction that he cannot really support in any way. > Channels cannot be created on-the-fly. RBF is opt-in, only if you mark your transaction as such. If you don't want RBF, don't use RBF. His assertion that RBF is somehow required is not true. > Recipients have to be online. Yes, they do. This is perfectly fine for some use-cases, and not good for others. For use-cases where the recipient is offline, people can always resort to on-chain transactions. I'm not sure what this has to do with hubs, though. Basically, he's making tons of assumptions and guesses (some of them based on incorrect/outdated technical information). You should go and read-up yourself on the technology and the improvements the developers are coming up with.
- codingmyway 10y ago
  That is part of it. I think some miners are against any increase because it will lower fees. Without a blocksize limit fees tend to zero, which is fine while there is the block reward but they still want to milk the congestion fees. To say they are pro segwit or pro unlimited is bluffing. They are pro status quo and congestion and high fees. The idea that lightning will lead to a hub, in the case of Unlimited believers they think this will be Blockstream and therefore think that the core developers who work for Blockstream are blocking a blocksize increase for nefarious reasons when they are doing it to avoid a hard fork and to maintain the incentives of miners while enabling cheap off chain transactions. That idea that a natural hub monopoly will form is ill thought out as explained here: https://youtu.be/fst1IK_mrng?list=WL&t=6072 https://youtu.be/fst1IK_mrng?list=WL&t=6072
- joshontheweb 10y ago
  Thank you for the concise rundown.
nadaviv 10y ago
The debate is largely about the risks of doing an hardfork (what Bitcoin Unlimited is doing) versus softforks (what Segregated Witness is doing). I recently presented these slides on this topic, but they assume a fair amount of background: https://www.docdroid.net/TouvFPl/embassy-future-politics-feb2017.pdf.html https://www.docdroid.net/TouvFPl/embassy-future-politics-feb...

I've been an outside observer of the block size debate for a while now, so here is my naive take on it: The anti-block size increase camp says that increasing the block size is only a temporary fix, and that no blockchain can accommodate Visa levels of throughput. They also posit that any increase in the block size will make running a full node more difficult, meaning Bitcoin will become more and more centralized and consolidated around the big mining pools that have the hardware to handle bigger block sizes. However, many in the anti camp are pro segwit (segregated witness), a code change that does several things and is the first step to enabling off-chain networks like Lightning Network. These are basically pools of Bitcoins tracked by networks off the blockchain that would allow you to instantly exchange Bitcoins to anyone else in your network. This is a big problem for miners who have poured lots of money into their rigs, because now the blockchain would be little more than a settlement network. There would be far more transactions occurring off the network, meaning less money for miners. Again I'm no expert on this but this seems to be the crux of the debate. The Core developers seem to be OK with having the blockchain relegated to being a settlement network (similar to how Visa, your bank and merchants work together), but many people are opposed to this, partly because these off-chain networks would quickly form large central "hubs" which would obviate many of the benefits of Bitcoin (anonymity, privacy, security and decentralization).

Laforet 10y ago
I've also been keeping tabs on the debate and I agree with you except on one account: Not everyone want the Bitcoin to be the next Visa or Paypal, some are perfectly content with a 10 minute confirmation delay as long as the blockchain remains fully distributed and anonymous, whereas others see a business opportunity that could make themselves rich and influential down the line. The entire narrative about larger block making the network more centralised is a red herring. The network has been going in that direction for quite some time without a block size increase and in any case, going from 1MB to 2MB or even 16MB isn't going to change the economics of running a full node that much, which is to say there are no incentives for non-miners to host a full node at all, regardless of the alleged computing and network overhead (and worse, it can make you a more likely victim of DDoS attacks[0]). The entire point about keeping the 1MB limit (which was meant to be a temporary cap anyway) is to artificially create scarcity in transaction capacity and coerce people into accepting SegWit and eventually fully functional side chains. This is probably fine for those who believe that A. Bitcoin will become mainstream and B. the ends justify the means, but I find this to be a very unethical position to take. Disclaimer: I don't own a single cent in BTC, nor do I have association with anyone involved in the Bitcoin scene. [0]:http://www.financemagnates.com/cryptocurrency/news/the-latest-victims-of-ddos-attacks-banks-and-bitcoin-xt/ http://www.financemagnates.com/cryptocurrency/news/the-lates...
notyourwork 10y ago
>They also posit that any increase in the block size will make running a full node more difficult, meaning Bitcoin will become more and more centralized and consolidated around the big mining pools that have the hardware to handle bigger block sizes. With a bigger block size what hardware constraints begin to appear? > This is a big problem for miners who have poured lots of money into their rigs, because now the blockchain would be little more than a settlement network. There would be far more transactions occurring off the network, meaning less money for miners. So the motivation is strictly monetary?
- pmorici 10y ago
  > With a bigger block size what hardware constraints begin to appear? Mostly it is an issue of disk space and network bandwidth. right now a 1 MB block is produced every 10 minutes. That has to be transferred over the network to every node and each so called "full node" has to store that block. The total size of the Bitcoin block chain for all time is currently ~100GB and grows 1 MB every 10 minutes under current conditions. If the block size grew too big that you couldn't transfer a block within the 10 minute space between blocks then your connection is too slow to run a node. On the disk space front you can run what is called a "prunning" node which discards older parts of the block chain that are no longer relevant which reduces disk space requirements greatly. There is also the issue of the initial blockchain download where when you are setting up a new node you have to download 100GB of historical block chain data to catch up to the current state of the network. These are all solvable problems though and Bitcoin's inventor envisioned that some day full nodes would be run out of data centers on heavy duty hardware. Small block supporters have argued that that hurts decentralization because some poor guy in Africa can't run a node on his Raspberry Pi and 3g internet if the block size gets much bigger. On the other hand if you are too poor to run a full node with a larger block size then you can hardly afford to pay huge transaction fees to transact on a network with a constricted block size so the whole argument that limiting the block size decreases centralization doesn't really hold water because in the end it limits user growth which is the ultimate decentralization mechanism. > So the motivation is strictly monetary? I think so. This whole stink started because some guy who happened to have a ton of BTC was upset that people running full nodes didn't get a cut of any of the transaction fees. Today, the main company that is pushing the Segwit / small block agenda hopes to push everyone to their off chain lightening network where they can collect the fees instead of the miners. Miners don't want to do anything that will jeopardize their profitability long term and keeping the block size too small limits their ability to control the supply of their product (block space).
nadaviv 10y ago
> partly because these off-chain networks would quickly form large central "hubs" which would obviate many of the benefits of Bitcoin The Lightning Network is open-source and decentralized. It has no "hubs", but rather just peers that route payments to each-other using a payment routing algorithm. Lightning has no counterparty risk, as no one can ever steal your bitcoins and you're always in full control. The best way to describe Lightning is as an write-cache layer. It improves the scalability properties of Bitcoin by many factors, makes micro- and nano- payments a reality, reduces fees to fractions of a cent, and even improves privacy (using a Tor-like onion routing for anonymized payments). https://www.youtube.com/watch?v=MpfvhiqFw7A https://www.youtube.com/watch?v=MpfvhiqFw7A https://bitcoinmagazine.com/articles/understanding-the-lightning-network-part-building-a-bidirectional-payment-channel-1464710791/ https://bitcoinmagazine.com/articles/understanding-the-light...
- cloakandswagger 10y ago
  How do you counter the description of the network in this article? It seems like de-facto hubs will form out of necessity to avoid creating a channel on the fly, which requires getting a transaction committed to the blockchain. https://chrispacia.wordpress.com/2015/12/23/lightning-network-skepticism/ https://chrispacia.wordpress.com/2015/12/23/lightning-networ...
  - nadaviv 10y ago
    > Routing paths are much harder to find when values are considered. Hard, yes, but definitely possible. There was some great work done on P2P routing for Lightning by the developers at BitFury. http://bitfury.com/content/5-white-papers-research/whitepaper_flare_an_approach_to_routing_in_lightning_network_7_7_2016.pdf http://bitfury.com/content/5-white-papers-research/whitepape... > We could end up making more on-chain transactions ... Well, it will have to close one of its existing channels. So the process for making a transaction when your wallet can’t find a route is: 1) Make an on-chain transaction closing out an existing channel. 2) Make an on-chain transaction opening a new channel with the payee. This is not true. You can close an existing channel and open a new one in a single transaction. > The vast majority of users will be offline. Some will, some won't. Some will set this up on a VPS, some will use hosted services, some will be professional liquidity providers (early adopters with lots of coins?) that have a machine dedicated to this. He's making a prediction that he cannot really support in any way. > Channels cannot be created on-the-fly. RBF is opt-in, only if you mark your transaction as such. If you don't want RBF, don't use RBF. His assertion that RBF is somehow required is not true. > Recipients have to be online. Yes, they do. This is perfectly fine for some use-cases, and not good for others. For use-cases where the recipient is offline, people can always resort to on-chain transactions. I'm not sure what this has to do with hubs, though. Basically, he's making tons of assumptions and guesses (some of them based on incorrect/outdated technical information). You should go and read-up yourself on the technology and the improvements the developers are coming up with.
codingmyway 10y ago
That is part of it. I think some miners are against any increase because it will lower fees. Without a blocksize limit fees tend to zero, which is fine while there is the block reward but they still want to milk the congestion fees. To say they are pro segwit or pro unlimited is bluffing. They are pro status quo and congestion and high fees. The idea that lightning will lead to a hub, in the case of Unlimited believers they think this will be Blockstream and therefore think that the core developers who work for Blockstream are blocking a blocksize increase for nefarious reasons when they are doing it to avoid a hard fork and to maintain the incentives of miners while enabling cheap off chain transactions. That idea that a natural hub monopoly will form is ill thought out as explained here: https://youtu.be/fst1IK_mrng?list=WL&t=6072 https://youtu.be/fst1IK_mrng?list=WL&t=6072
joshontheweb 10y ago
Thank you for the concise rundown.

nadaviv 10y ago

The debate is largely about the risks of doing an hardfork (what Bitcoin Unlimited is doing) versus softforks (what Segregated Witness is doing). I recently presented these slides on this topic, but they assume a fair amount of background: https://www.docdroid.net/TouvFPl/embassy-future-politics-feb2017.pdf.html https://www.docdroid.net/TouvFPl/embassy-future-politics-feb...