The block size debate is very active among the Bitcoin community right now. There are strong opinions for and against raising it.<p>Here is a good podcast episode with opinions representing both sides (Gavin Andresen and Peter Todd):<p><a href="https://letstalkbitcoin.com/blog/post/lets-talk-bitcoin-217-the-bitcoin-block-size-discussion" rel="nofollow">https://letstalkbitcoin.com/blog/post/lets-talk-bitcoin-217-...</a>
While the number of Bitcoin block chain transactions is increasing, their total value is not.[1] Volume in US dollars has declined slightly over the last year. We may be past "peak Bitcoin".<p>If blocks fill up, transactions with higher fees get through first. So the free market will solve this problem when necessary. It's in the interest of miners that fees go up, and the big miners control the block size, so a block size increase is unlikely.<p>Bitcoin's block reward halves next year, which instantly halves mining income. Bitcoin was designed so that when it became large enough, fees would support mining. Next year, fees become more important, and pressure for higher fees will increase. The system is functioning as designed.<p>[1] <a href="https://blockchain.info/charts/estimated-transaction-volume-usd" rel="nofollow">https://blockchain.info/charts/estimated-transaction-volume-...</a>
This block-size hurdle isn't new and is one of the ongoing examples of how Bitcoin is suffering from <i>Tragedy of the Commons</i>.<p>The offshore miners control Bitcoin, and they are independently and rationally aligned with their own self-interest and profit (as they should be). When it comes to forking changes that are not directly beneficial to the miners (block size), it's nearly impossible to get a consensus, even if it means making Bitcoin a better currency.<p>When you consider a change that makes it more difficult for a miner or cuts into a miner's profits, like increasing the supply to counteract deflation and hoarding, then you start to realize why Bitcoin is still having these issues.