Published on: 2015-06-30T22:56:04+00:00
In an email dated June 30, 2015, Adam Back discussed the interests and incentives of miners in relation to increasing block size limits. He noted that while miners can collectively keep blocks smaller, a large excess of space relative to current demand could result in fees dropping to zero for a few years if someone breaks ranks and takes any fee, regardless of how small. Back also mentioned that wallet defaults play a significant role in preserving fees, and that there is less reason today to worry about fees than there was in 2012.Back expressed uncertainty about the clear picture of hash-rate-imposed limits, but it is evident from the all-blocksizes plot that the 750K soft limit and another less common soft limit at 900K are being imposed and broken more frequently as demand surpasses them. These soft limits serve only to delay transactions, and there is no purpose to them other than that. Additionally, Back stated that a 750KB block is followed by another 750KB or larger block as frequently as expected from the actual block time distribution.BIP 101 has working code ready for evaluation to increase block size, but it remains unclear when Lightning and Sidechains will be ready for a fair and controlled test. Back suggested running an experiment as a layer 2 side-chain or analogous for those interested in higher tier data-center and throughput by high bandwidth use route. He also proposed conducting this experiment parallelly with Lightning to see how it works.The concept of "decentralization" is gaining popularity in the context of Bitcoin, which differentiates itself by preventing double spending without a trusted third party. The author of the text shared a link to a paper on measuring decentralization of government functions, which provides a framework for defining decentralization metrics. Although not directly related to Bitcoin, the paper can be useful in understanding how decentralization can be measured.The security model of Bitcoin is based on decentralization, but Back's statement about decentralization being key to Bitcoin's security model lacks definition and evidence. A more precise problem description is needed to focus on questions about incentives for nodes to collude with miners or behave as trusted third parties. MAX_BLOCK_SIZE is also related to these questions.Bitcoin experts such as Greg Maxwell, Jeff Garzik, and Gavin Andresen have discussed the issue of block size and scaling for improved decentralization, privacy, and throughput. While increasing block size is important, it should be done within tech limits and allocate some bandwidth to decentralization improvements. Miners should also be considered in the block-size increase plan. The growth should scale smoothly to avoid unforeseen side-effects, and tests of achievable network bandwidth on different networks should be conducted.Decentralization is crucial to Bitcoin's security model, and alternative designs that are more network efficient while achieving effective decentralization are preferable. Lightning or a semi-centralized trade-off in the side-chain model could be more appropriate for high scale. It is suggested that BIPs should include sections on security, privacy, and decentralization/fungibility. Additionally, any proposal should be reasonably analyzed in terms of bandwidth assumptions and game theory.While increasing capacity alongside hardware is a good idea, it is important to ensure that core functionality remains for Lightning and other scaling approaches to remain secure by using Bitcoin as a secure anchor.
Updated on: 2023-08-01T14:10:44.341927+00:00