Author: Eric Lombrozo 2015-07-22 19:17:44
Published on: 2015-07-22T19:17:44+00:00
The debate surrounding the block size limit and fee market in Bitcoin has been ongoing for some time, with differing views on what direction the cryptocurrency should take. One argument is that limited block space and the development of a fee market is not a change in policy, but rather an expected evolution of economics. However, this perspective ignores the reality of what users have experienced over the past six years, where fee pressure has been largely absent due to the majority of miner income coming from block rewards. This has resulted in a lack of incentive to find solutions to real problems that need solving, and the main barrier to widespread Bitcoin adoption may not be the issue of fees. Analysis suggests that when blocks are consistently full, there will be a period of chaos and market disruption before settling to a new equilibrium. The current userbase and market is still small, and there are other significant issues such as the high cost of verification and centralization pressures on validation that need addressing to ensure scalability for potential millions or billions of users. Increasing block size is seen as a distraction from more fundamental issues. The economic policy of Bitcoin has always been to subsidize blocks initially and transition to fees. Artificially continuing to rely on block reward subsidies is what represents a new economic policy. The intent of the block size should be growing with the evolution of technology, not a panic reaction due to a fear of change. Letting a fee market develop sooner than later is crucial, as kicking the can down the road is a dangerous precedent. However, there are concerns about forcing a view and giving up consensus, which could result in market disruption. Ultimately, the focus should be on finding better scaling solutions that avoid the need for global consensus for the vast majority of transactions, rather than increasing block size. While there are differing opinions on what direction Bitcoin should take, the priority should be on thinking bigger than the current userbase and market, and addressing core issues while the cryptocurrency is still small.
Updated on: 2023-06-10T03:10:05.712283+00:00