Gold collapsing. Bitcoin UP.

Peter R

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Aug 28, 2015
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"The real trick will be making a P2P protocol that outperforms the relay network." -- @theZerg

It would be great if we could get funding somehow from miners to hire junior software developers to do some of the lower-level development for subchains (and other things that miners want). @Gavin Andresen mentioned the need to "design for your customers." My question is, how do we get our customers (assuming for the moment that our target customers are the miners) to contribute funding towards development?

Personally, I don't think implementing subchains would be that difficult. What I suspect would be more difficult is getting enough of the network to use them for them to be worthwhile.
 

theZerg

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What if they traversed the GFC much easier due to properties of their data structure and maybe a few network layer tricks? We need a partner on the other side...

...and funding is never a bad thing :)
 
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Peter R

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[CROSS POST FROM HERE]

I’m wondering if enough knowledge about BU and emergent consensus exists to write a white paper. The purpose of this thread is to (a) brainstorm the main points that such a paper should touch upon, and (b) collect links to the relevant information that should be cited.

To get us started...

1. Introduction

2. The Most Extended Chain

- Miners mine upon the most-likely-to-win chain rather than the longest chain. We'll refer to the most-likely-to-win chain as the “most extended” chain (as per @Roger_Murdock) .

- The "most extended" chain is normally the longest chain (it contains the most PoW) but it gets "retarded" by a factor that accounts for strange things that might make miners and nodes more likely to reject or orphan it.

- For example, a chain with a block at its tip that takes longer than 10 min to validate/propagate is less extended than the chain without that block (as per @theZerg's recent paper) even though it contains more work.

- Formalize this idea further...

- The "retardation factor" cannot be precisely measured or defined--only approximated. Each node and miner is free to make its own estimates.

- It is through this process of miners picking the most-likely to win chain by using their discretion for edge cases--rather than blindly mining upon the chain with the most PoW--that keeps Bitcoin's consensus objective.

- The reason for this is that the alternative is to define "the longest valid chain as the valid chain" which--as @digitsu just pointed out in his recent article--relies on weak subjectivity (Core defines what is "valid" rather than validity being an emergent property of the network). In BU, the subjectivity would appear to enter into the system in real-time in a decentralized fashion as each miner applies his own "retardation factor" (based also on what he thinks will be accepted by the nodes).

3. There is No Block Size Limit

- Rational arguments against the existence of a strict block size limit:
+ node operators and miners have always been free to roll their own code
+ The 1 MB limit in Core's reference implementation was just an "inconvenience barrier"
+ Core cannot prevent nodes/miners from changing their limits if miners and nodes are free to join the network

- Empirical evidence against the existence of a strict block size limit:
+ my charts here.

4. Large Blocks

- Formalize with math when a node will fork from consensus and when a block will be accepted into the longest PoW chain. Prove that:
+ A node with a block size limit greater than the hash-power weighted median will always follow the longest chain.
+ A large block will be accepted into the longest chain if it is smaller than the hash-power weighted median block size limit.
+ Analyze the conditions for network split events.

5. Forking Pressure

- Introduce the concept of "forking pressure" in the context of the block size limit as a node's or miner's desire to allow the network to process more transactions per second (looks like @Roger_Murdock just spoke about this here)

- Here is perhaps a partial quantitative description (the deadweight loss due to the existence of a production quota with Qmax < Q* is a sort of "pressure.")

6. Consensus Pressure

- Introduce the concept of "consensus pressure," which is particularly important for miners, and which is related to the great advantage that ensues if miners agree together on the same (or compatible) limits.

- It is best if the majority of the hash power has the exact same limit, in order to prevent network split under the conditions defined in Section 4 (in the very unlikely cases when it could happen).

- Perhaps "consensus pressure" could be modelled as something as simple as:

P_consensus = K x ( Median limit - Node's limit).

7. A Simple Model of Emergent Consensus

- Show using a simple program (a la Wolfram NKS) that entities that can "feel" forking pressure and that can "feel" consensus pressure, will spontaneously agree on new block size limits as pressure builds, so long as they have some means to signal their settings to the other nodes.

8. Conclusion

[CROSS POST FROM HERE]
 

Justus Ranvier

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Aug 28, 2015
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- Miners mine upon the most-likely-to-win chain rather than the longest chain.
You can cite two examples of this occuring: the 2010-08-15 integer overflow event, and the 2013-03-11 bdb event.

In both cases, the issue was resolved by individual miners manually overriding their nodes' behaviour and choose to extend a minority-hashpower chain.
 

freetrader

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Dec 16, 2015
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My question is, how do we get our customers (assuming for the moment that our target customers are the miners) to contribute funding towards development?
Miners will pay for something that earns them more money.

Have we demonstrated, convincingly, that they stand to make more money if they take courage and raise the mining block size to accommodate demand? And that they will be able to do this safely by running BU (or even doing the development themselves)?

For the Chinese mining community, perhaps we could get in touch with notable Chinese academics / economists, who could better argue these points on our behalf if given sufficient supporting information.

I read an interesting opinion by Charlie Lee in a reddit thread. While he was speaking about Litecoin, I feel most of it probably applies to Bitcoin in China too, currently:

https://np.reddit.com/r/litecoin/comments/3z2ta1/ama_official_litecoin_developers_and_litecoin/cym98px said:
The Chinese litecoin community is a bit different from others. Most crypto users in China don't see it as a currency. It's more of a way to make money from mining and trading. So the community is much more focused with those 2 aspects of Litecoin.
Long term, people in China would need to understand the potential of Bitcoin as peer to peer electronic cash. If this understanding was the norm, then I think there would be much less resistance from the miners.

Disclaimer: I might be very under-informed about the state of Bitcoin usage in China. I just have the impression that while mining and trading is strong there, there is less of a developed "base" awareness of a potential wider Bitcoin economy.
 
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rocks

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Sep 24, 2015
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This relay network stuff has certainly got me worried. Is anybody actually working on coding up subchains/iblt right now? Is there any kind of donation fund or movement to get this started? I think we rally need it sooner rather then later, its really sad that the deva chose a centralized approach to scaling bitcoin early on and now it explains a lot.
This goes back to the problem that the entire Bitcoin ecosystem have not and continue to not invest in Bitcoin core development. Almost all successful open source projects are not supported by spare time developers, but corporations investing their own developer resources in enhancements that make sense for them.

But with Bitcoin all of the Bitcoin companies are absent, where are the contributions from Coinbase, bitstamp, etc?

The reality is scaling systems takes time and effort, and only those who benefit from increasing Bitcoin's scale are motivated to spend the resources to do so. Due to the coinbase reward, miners probably won't be motivated for at least another ~8 years. That leaves merchant providers, exchanges, etc. to invest in scaling, but they have not. As mad as everyone is now at the core devs for not scaling Bitcoin, they do not owe it to anyone invest their time to scale the system.
How the f*** did we let one company get in charge of all Bitcoin node / mining infrastructure development?
I think there were two reasons that lead to this situation.

1) The first two leaders (Satoshi, then Gavin) were 100% behind scaling. This was so clear that everyone took it for granted that the next set of people to take over would follow the same vision. It lead to complacency in vetting the next set of people to take over.

2) The core devs left "public" forums and closed themselves off a few years ago, while also ignoring or intimidating potential new contributors. This prevented new people from joining development and also drove many away.

The result of the combination of these two factors is centralized development that is wildly out of step with the broader market.

Edit:

Stephen Pair (CEO BitPay) on scaling - "That's nonsense, it can be done"
https://medium.com/@spair/bitcoin-as-a-settlement-system-13f86c5622e3#.6vde7bg5q

It is nice to see some of the main companies finally coming out and publicly defend scaling and writing articles on the topic.

Hopefully they see that they need to step up to the plate to get this done, and not just talk though. We are still waiting for that big December announcement, and if it was that Coinbase is running one XT node we have a problem.
 
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Matthew Light

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Dec 25, 2015
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The reality is scaling systems takes time and effort, and only those who benefit from increasing Bitcoin's scale are motivated to spend the resources to do so.
We could easily scale bitcoin by simply allowing the software to use a larger block size limit (configurable, like with BU). Yes, at some point more than that will be required.
 

Zangelbert Bingledack

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Aug 29, 2015
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I think companies, being rational users of funds, will be reluctant to shell out for coders to work on open source until Core destroys its reputation sufficiently. Companies are waiting to see if Core can either pull a rabbit out of its hat or just give in and up the blocksize cap. They wouldn't want to spend millions only to be told their efforts are getting in the way, or worse, "wasting the Core devs' time." :p

Edit: And also, XT and more so BU should create a much more inviting atmosphere for devs, so that we get Bitcoin-in-2016-level world class devs rather than Bitcoin-in-2011-level. I mean Bitcoin wasn't a huge deal back then and the current devs jumped on. Now it is a huge deal and where are the world-class devs? Mostly scared off by Core's gridlock. (Blockstream got Rusty, though.) BU helps blow that open. This very debate is part of that solution.
 
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freetrader

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http://bitcoinocracy.com/ has actually come up with quite interesting results!

I remember when it was used to show lack of support for BIP101 - no longer the case.
Unlimited is also popular.

Wonder how long until Theymos and his moderation get their deserts.
 
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cypherdoc

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Aug 26, 2015
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GBTC continuing higher:

 
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Miners will pay for something that earns them

Disclaimer: I might be very under-informed about the state of Bitcoin usage in China. I just have the impression that while mining and trading is strong there, there is less of a developed "base" awareness of a potential wider Bitcoin economy.
In 2014 I had a very eloquent chinese correspondent for my blog. His articles may teach a lot about the mentality of the chinese bitcoin scene.

http://bitcoinblog.de/tag/zhangweiwuengl/

It's a long time we have been in touch and he lives in australia by now, and I don't know if he's still in bitcoin ...
 
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freetrader

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Thanks Christoph, he writes very honestly and eloquently from a Chinese perspective, I think that's incredibly useful for us to understand the mentality.

It's sometimes difficult for us to appreciate what the driving motivations behind Bitcoin adoption are, but after reading his last article (July 2014) I already see quite a lot of similarities.

It would really be interesting to get an updated perspective from him!
 

rocks

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Sep 24, 2015
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We could easily scale bitcoin by simply allowing the software to use a larger block size limit (configurable, like with BU). Yes, at some point more than that will be required.
That is just removing the cap, which is easy.

But even with the cap removed there are real barriers to scaling bitcoin and we wouldn't see blocks larger than 5-10MB produced without some significant improvements. Some of these are related to decreasing block propagation time (IBLT, thin blocks, subchains, etc). Some of these are related to not having the code break (for example the 8MB transaction attack that takes 10 mins for a node to process, breaking the network). Some of these are related improving code performance (new code bottlenecks are introduced as systems scale).

None of these are reasons to keep the cap. The cap should be removed and then each is addressed as needed.

But simply removing the cap is not enough. The problem is even with the cap removed, there still is a lack of people taking the time and investment to address these issues. Blockstream isn't.
[doublepost=1452023423][/doublepost]
http://bitcoinocracy.com/ has actually come up with quite interesting results!

I remember when it was used to show lack of support for BIP101 - no longer the case.
Unlimited is also popular.

Wonder how long until Theymos and his moderation get their deserts.
Look at this vote, crazy.

http://bitcoinocracy.com/arguments/moderation-policy-by-theymos-removes-distractions-by-poor-trolls
 

Justus Ranvier

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Aug 28, 2015
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The problem is even with the cap removed, there still is a lack of people taking the time and investment to address these issues. Blockstream isn't.
Nobody is taking the time to address those issues, because Blockstream is so far successful at blocking the deployment of those solutions.

Once Blockstream is out of the way, and when the need for those solutions appears, then people will take the time to work on them.
 

Matthew Light

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Dec 25, 2015
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But even with the cap removed there are real barriers to scaling bitcoin and we wouldn't see blocks larger than 5-10MB produced without some significant improvements.
Right now, Bitcoin is not seen as being "important", except for the blockchain (which of course only exists and "works" because of Bitcoin, but let's not quibble).

We need fresh all-time highs, preferably closer to $10,000 than $1300. When we see those kinds of highs, all the people who keep dismissing Bitcoin will be forced to re-examine their beliefs. A big market cap ~100 billion also gives Bitcoin the size it needs to begin to absorb currency flows. But we can't easily go to fresh ATH without a 4-5x larger transaction capacity.

Once these things happen, we will be absolutely swimming in dev resources.
 

rocks

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Sep 24, 2015
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Nobody is taking the time to address those issues, because Blockstream is so far successful at blocking the deployment of those solutions.

Once Blockstream is out of the way, and when the need for those solutions appears, then people will take the time to work on them.
Fully agree with this, as said in the previous page one of the main reasons other haven't participated much is the core dev team formed their own little circle that excluded newcomers, drove them away from participating and created uniformity of thinking.

That said, although Greg circled the wagons to keep people out, it doesn't seem that many developers from non-blockstream companies pushed hard to get in. Instead it seems they just let development proceed on it's own direction. Hopefully the lesson has been learned and we will see this change.
 

cypherdoc

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Aug 26, 2015
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Andreas Schildbach:

“The Lightning Network and similar proposals will cause a complexity explosion on Bitcoin as a whole,” Schildbach said. “It will take quite a while to implement, test, fix and roll out the protocol. I'm talking of years, rather than months. I'm aware Blockstream is working on the core implementation. But work on necessary infrastructure, like wallets and the payment protocol hasn't even started, as far as I know.

https://bitcoinmagazine.com/articles/bitcoinj-developer-andreas-schildbach-i-will-not-invest-my-time-in-lightning-networks-1452005206
 

solex

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3TPS = ~100 million transactions per year. BTC "market cap" = ~$7,000 million.

7th anniversary is just gone. Let's assume Bitcoin will hang around for 7 more years.

Is $10 per txn per year a fair valuation? Well, maybe we can see the amount of value already in the BTC price which is predicated upon much higher txn volumes in the near future.
 
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rocks

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Andreas Schildbach:

“The Lightning Network and similar proposals will cause a complexity explosion on Bitcoin as a whole,” Schildbach said. “It will take quite a while to implement, test, fix and roll out the protocol. I'm talking of years, rather than months. I'm aware Blockstream is working on the core implementation. But work on necessary infrastructure, like wallets and the payment protocol hasn't even started, as far as I know.

https://bitcoinmagazine.com/articles/bitcoinj-developer-andreas-schildbach-i-will-not-invest-my-time-in-lightning-networks-1452005206
An interesting aspect of bitcoin development is who has more control, the bitcoind core devs or the wallet vendors.

There is an interesting argument I think that the wallet vendors have more control because they are the interface between users and the network. For example if core devs roll out SW but wallets boycot it and refuse to integrate SW functionality (until block sizes are raised), then wallets effectively prevent SW from being implemented. Same for LN, without wallet development support any feature Greg tries to force in could see zero user adoption.

Someone posted here earlier that all the wallets are for larger blocks (except for one small one). I suspect that means most are ticked off as well.

Imagine being Adam back asking for their next round from investors, and having to explain that yes they implemented LN but they have zero users because all the major wallets are either outright boycotting LN or dragging their feet on implementing it. I could actually see Greg arguing that they did their job and it is not their fault no one is going along.....