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Is Bitcoin breaking up?

85 pointsby antoniusover 9 years ago

15 comments

pashover 9 years ago
The Bitcoin community is rapidly coalescing around an effort to increase the maximum allowed blocksize to 2MB as soon as possible. This increase is being implemented in a new client, Bitcoin Classic [0], which is a fork of Bitcoin Core that changes only the single line of code that sets the blocksize limit.<p>Bitcoin Classic was created by Jonathan Toomim, an American miner and developer who went to China to talk directly with Chinese miners and to test the effect of bigger blocks on mining operations behind the Great Firewall. Gavin Andresen, Bitcoin Core&#x27;s former lead developer, and Jeff Garzik, another prominent Core developer, as well as many others, are collaborating with Toomim on further changes that Bitcoin Classic may implement later.<p>The big difference between Bitcoin Classic and Mike Hearn&#x27;s failed Bitcoin XT is the concerted effort by the people behind Classic to garner the explicit support of miners (and other important members of the Bitcoin ecosystem) for a blocksize increase. At my last check yesterday, mining-pool operators representing 72% of global hashing power had explicitly expressed their support for Bitcoin Classic&#x27;s blocksize increase, as had the operators of many popular exchanges, web wallets, and payment providers. (There is a growing compendium of prominent supporters on Bitcoin Classic&#x27;s website; the complete list is on the project&#x27;s Github page [1].)<p>That means that Bitcoin Classic is very likely to break Core&#x27;s monopoly on the protocol soon. The blocksize increase, and the fork of the blockchain that it will create, is tentatively scheduled to take place after March 1. Get ready.<p>(By the way, the best sources for information and discussion about the Bitcoin world are now the &#x2F;r&#x2F;btc sub-Reddit and the discussion forums at bitcoin.com and bitco.in; the community&#x27;s former hubs, &#x2F;r&#x2F;Bitcoin and bitcointalk.org, are both controlled by the same operator&#x2F;moderator, and he has strongly censored and perverted all discussion of changes to the protocol that are not supported by Core&#x27;s intransigent cabal of developers.)<p>0. <a href="https:&#x2F;&#x2F;www.bitcoinclassic.com" rel="nofollow">https:&#x2F;&#x2F;www.bitcoinclassic.com</a><p>1. <a href="https:&#x2F;&#x2F;github.com&#x2F;bitcoinclassic&#x2F;website&#x2F;issues&#x2F;3" rel="nofollow">https:&#x2F;&#x2F;github.com&#x2F;bitcoinclassic&#x2F;website&#x2F;issues&#x2F;3</a>
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mrbover 9 years ago
<i>&quot;Mining already is so expensive that it takes company-sized investments to participate&quot;</i><p>This is not true at all. I do not understand why journalists repeat this claim. It is like saying &quot;investing in the stock market is so expensive that it takes company-sized investments to participate&quot;. It is not true. Whether you invest $1000 or $1 million your returns—as a percentage of your initial investment—will be the same regardless if this is the stock market or Bitcoin mining.<p>In fact I would say the opposite is true: small miners have a slightly better profitability than large-scale miners, because they are so small they do not even have to cover certain costs. A large-scale miner will have to pay for hosting or for building a data center but a small miner will host the hardware in his house at no extra cost. A large-scale miner will have to hire staff to maintain the miners but a small miner will maintain his machine himself.<p>Of course profitability depends a lot on electricity costs, but again you might be a small miner and live (for example) in Douglas County, Washington and pay a domestic electricity rate of 2.5 cents per kWh, and you will beat many large-scale miners who almost always pay more (see my previous comment on this: <a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=10907584" rel="nofollow">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=10907584</a>).<p>Large-scale miners may get a financial advantage by buying hardware in bulk, or manufacturing it themselves, but this is a cost saving of at most 20 or 30%, and this certainly does <i>not</i> make mining so expensive that small miners cannot participate.
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siskover 9 years ago
&gt; The problem is bitcoin is open-source software, so any change has to be approved a majority of the community, and it hasn’t been able to agree.<p>The author has conflated a couple of things. That is the exact opposite of how OSS works. The reason why the majority need to adopt is purely from a &quot;one true coin&quot; standpoint—there is nothing stopping forks or new alt coins from spinning out.
wemyshover 9 years ago
The current situation reminds me a lot of the time when Firefox replaced Internet Explorer as the most popular browser. And of the time when Chrome replaced Firefox as the most popular browser.<p>Currently there is only one Bitcoin implementation. And the developers a) refuse to implement what users want. And b) implement bloat that users dont&#x27;t want.<p>So Bitcoin will &quot;break up&quot; in a similar way the WWW &quot;broke up&quot; when new browsers were introduced.<p>It&#x27;s a good thing.
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cornholioover 9 years ago
&quot;Bitcoin is breaking up&quot; = Buy like a madman. The blocksize cuts down on the transaction spam making transactions non-free, maybe a few cents each. This is not optimal and certainly needs to fix in the next few years, because it harms microtransactions.<p>But &quot;breaking up&quot; ? That&#x27;s just sensationalist bullshit. That&#x27;s like saying Netflix is on the edge of bankruptcy because it&#x27;s raging success has temporarily killed HD streaming in Australia &amp; Antarctica. As a community building exercise, this debacle is great for Bitcoin, it really shows no one is in control and consensus to change the rules of the game is very hard to reach.
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SCAQTonyover 9 years ago
I think these are very exciting problems. The bigger the problem the more creative the solution.<p>It took us two thousand years or so to go from using the weight of a bale of barley to represent the value of silver, bronze, copper to eventually actual coinage.<p><a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;History_of_money" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;History_of_money</a><p>Maybe digital currency takes 15-years or so to work out the problems much like they did with barley to coins but it is definitely the future.
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zekevermillionover 9 years ago
Bitcoin is already specified. I doubt that nodes, miners, and the bitcoin richlist will converge around any alternative spec (whether XT or Litecoin) and decide to call it &quot;bitcoin&quot;. However, the ecology of decentralized digital assets inspired by the nakamoto consensus has already fragmented and will continue to do so at an exponential rate. As a rough estimate let&#x27;s say there are already 1000 bitcoin clones that have more than a handful of nodes and miners. I would not be surprised to see that number increase to 10,000 within 2016. That some of the individuals associated with Bitcoin Core are moving onto other projects is not going to mean very much one way or another for the original bitcoin spec, though we may see the Core project change. There are other alternatives for those who want to run an implementation of the original bitcoin spec. (<a href="http:&#x2F;&#x2F;thebitcoin.foundation&#x2F;" rel="nofollow">http:&#x2F;&#x2F;thebitcoin.foundation&#x2F;</a>) And there are an exponentially growing number of alternative networks for those who do not.
Animatsover 9 years ago
The block size issue is missing the point. The use case that matters for Bitcoin right now is converting yuan to Bitcoins, then Bitcoins to dollars. That&#x27;s one way people in China get around China&#x27;s exchange controls. (Note that mining in China also is used to move yuan to dollars.) Those are big transactions. They&#x27;ll get through regardless of the block size.<p>Bitcoin as a retail currency doesn&#x27;t seem to be going anywhere. Robocoin, the Bitcoin ATM company, just went bust. Lots of companies nominally accept Bitcoin, but that&#x27;s just a shopping cart program talking to Coinbase or Bitpay for immediate conversion. The retail transaction volume is small. Given the volatility problem, the conversion costs, the risk of loss, and the general headaches, Bitcoin is a lose vs. paying 1% - 3% for credit card processing.
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kobayashiover 9 years ago
What is the downside to moving from 1MB to 2MB blocksizes, instead of moving up to 8MB or 20MB? If the reasonable maximum number of trades per minutes is 3 at the moment, does a doubling of the blocksize merely double the allowable number of trades per minute, or is it somehow a logarithmic change?
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greggariousover 9 years ago
Not sure due to the paywall.
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ZoeZoeBeeover 9 years ago
If you want to read the article without being blocked by WSJ&#x27;s paywall just Google the name of the article and click on the link. More often times than not you can get to a WSJ article via GoogleNews even if it is pay-restricted.
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darwins_pitbullover 9 years ago
Hi Mike. I met you at San Jose conference in 2013. I remember very clearly- you were the most dashing, handsome, well spoken and charismatic person at the entire conference, a very rare find in the developer community. I was just finding my bearings in this technology at the time, I was a long way from home, and remember the confidence it instilled in me, knowing that someone like yourself was involved in this. But as I followed your contributions to the effort in the months after the conference, it was so confusing- nothing you did really seemed to help, your suggestions were widely panned by most of the best technical minds, and you seemed to devote your energy to platforms that are largely made up of newbies.<p>If I was a handler for an organization that wanted to insert an asset into the bitcoin community, someone like you would be the ideal candidate. Someone that young people, new to the community, naturally respect and will listen to. Strange how you&#x27;ve spent so much time cultivating your standing with people like that, while your reputation plummeted among the people that understood the network (and had far more skin in the game than you did, because if I remember correctly you never foresaw the spectacular growth of the bitcoin network, never thought it would work, and therefore did not really have that many coins yourself). I have a long history of having a keenly skeptical eye, I have solid critical thinking skills, and I bat away wacky theories all day long. I have NEVER, in any forum, posted any comment of any type in regards to bitcoin, this is my first one- I believe in speaking humbly, thinking deeply and acting bravely. While the evidence that your motives in the bitcoin network may not be what you say they are is only circumstantial, it has been accumulating for some time now. And the strongest allegations have come from the people who have the best reputations for clear thinking and scam calling. I mean you no ill will Mike, regardless of your intentions. But the forces at play and the implications of our technologies&#x27; reach is so spectacular that it is quite reasonable now for us to assume that smart and highly motivated people will appear who will use great cunning to harm the network. Every spidey sense I possess has been going off about you for a long time now. I can remain silent no longer.<p>J&#x27;accuse Mike, J&#x27;accuse.
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powertowerover 9 years ago
&gt; Is Bitcoin Breaking Up?<p>If they have to frame a headline as a question, you can usually assume the answer is &quot;no&quot;...<p><a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Betteridge%27s_law_of_headlines#Betteridge_.282009.29" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Betteridge%27s_law_of_headline...</a><p><i>The reason why journalists use that style of headline is that they know the story is probably bullshit, and don’t actually have the sources and facts to back it up, but still want to run it.</i>
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colindeanover 9 years ago
<a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Betteridge%27s_law_of_headlines" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Betteridge%27s_law_of_headline...</a>
ohthehugemanateover 9 years ago
This headline is a great &quot;grabber&quot; for older bankers and financiers. It implies that the whole &quot;bitcoin thing&quot; is finally blowing over, without going out and saying it. Music to their ears.
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