A compromise between BIP101 and Pieter's proposal

Summary:

The context discusses the decentralized nature of data centers and hosting providers, stating that they are independent and varied with different policies and laws applied depending on their location. As a result, it would be difficult for authorities to conduct a widescale attack on nodes worldwide given the current laws and the ability for hosts to quickly replace any hacked or seized host with a competitor service in a different jurisdiction. The context also highlights that personal residences and non-data center businesses are not immune to theft, blackmail, seizure, and hacking, and suggests that users who choose to use a VPS are not contributing to Bitcoin in some sort of inferior capacity. The email thread shared by Adam Back via bitcoin-dev discusses the security reality of hosting anything intended to be secure via decentralization or just hosting in general while at risk of political or policy attack. Data-center operators are bound to follow laws, including NSLs and gag orders, and can also get hacked, employ humans who can be corrupt, blackmailed, and themselves centralization points for policy attack. There is nothing inherently wrong with data centers/hosting providers playing a significant (but not central) role in decentralized services but it is not ideal to hold private keys in such places. Additionally, there is a proposal discussed in the email thread regarding a compromise between Gavin's BIP101 and Pieter's proposal (called "BIP103" here). The proposal suggests gradual growth in the block size over time, starting with an increase every 97 days until exactly 8MB is reached on 2017-05-11. After 8MB is reached, the block size will be increased by 6.714% every 97 days until it reaches its final cap of 4096MB on 2042-11-17. The rationale behind this proposal is to have faster growth in the beginning to normalize the block size to a more reasonable one, based on current adoption and technology. The proposal also suggests that while there is a need for a fee market, the fee pressure must not be too high at this moment when block reward is still the miner's main income source. Additionally, the value of secondary layers primarily comes from instant confirmation, not scarcity of block space.

Updated on: 2023-06-10T17:55:42.090285+00:00