Author: ZmnSCPxj 2020-03-30 02:59:52
Published on: 2020-03-30T02:59:52+00:00
The Bitcoin system forces users to assess how much security they are willing to pay for by creating a competition for limited block space. This ensures that every individual pays the market rate for block space, which is set purely by supply and demand. However, this mechanism may lead to some individuals paying less than what is required to keep the network secure. Bitcoin's off-chain mechanisms do not remove on-chain fees but only amortize them to multiple logical transactions, which allows increasing the effective capacity while still ensuring that on-chain fees remain at a level that will ensure continued healthy operation of the blockchain layer. Furthermore, the use of Lightning nodes is not a permanent solution as they will eventually close, and on-chain funds will be in the slow expensive on-chain domain. Hence, there will always be a need for some block weight limit, and that is what ensures that miners can get paid.
Updated on: 2023-06-14T00:31:22.194143+00:00