Gold collapsing. Bitcoin UP.

[freetrader]

Bitfury doesn't have the balls to support Classic, but apparently wants to use them as bargaining chip?

Looks like HF has been stalled once again:


What does "HF code ready" mean anyway? It's a blank cheque for a HF in 2099...

 

[cypherdoc]

How is it credible that it takes 10s additional time to validate a 2MB block compared to 1-2s for a 1mb block?

 

[Inca]

Whilst I would prefer a Classic fork. The key point is that the network will now HF to 2mb with SW providing further upscaling.

This should buy time for another couple of years of uninhibited growth.

It leaves a bitter taste in my mouth, but they have been forced to act. HF can no longer be hidden behind as impossible.

Edit: scanning reddit (/r/bitcoin an absolute trollfest) now they are saying SW first, hard fork code to code be inserted next three months, to activate in 2017 sometime..so actually no change whatsoever from before.

 

[Zangelbert Bingledack]

It doesn't really matter what the agreed-upon timing is; once blocks fill up even with SW, be that this year or next, Core won't be able to hold back the hard fork. The dynamics are always the same: either they relent or they lose more ground. Nothing can really change that, and if it could Bitcoin would be dead as a concept anyway.

For now I am content to sit back and watch the antifragility play out.

 

[Zarathustra]

@Zangelbert Bingledack
"once blocks fill up"

They already do, and the potential additional adoption is prevented already. The longer that situation continues, the more market share is moving to the altcoins.

 

[Bagatell]

@Zarathustra I like to think of it as Bitcoin becoming the petrodollar of crypto.

 

[freetrader]

It pains me to speculate on motives, but I think it's helpful to provide at least myself with a plausible model for the outcomes observed so far with Blockstream and the rest of the ecosystem.

I think Blockstream has gained control of key Core developers, and thus taken over Core. To the extent that when Core goes to China to present their progress on protocol development, they put Blockstream's president on the podium, and not their own lead maintainer.

Having to assume that Blockstream effectively runs the show at Core leaves me with the next question: what is Blockstream's game plan?

The obvious angles have been discussed, but IMO they don't fully account for the subservience of the Chinese miners. So here is my take, comment as you wish:

Blockstream could have been informed by their VC's that they should follow a certain strategic line of tolerating Chinese mining centralization at present or even increased levels, in the full knowledge that this is a short-term play that will result in Bitcoin's (planned) demise through government intervention, both Western and Eastern. The point? Destroy public confidence in open, decentralized cryptocurrencies. The promises to Blockstream employees and passed on to Chinese miners: you will make quick mint, never mind that we need to burn down this house.

This plan does not require decentralized development or mining, just a few "strategic miscalculations" by CEOs and loss of some reputations (though compensated fairly).

Open question: would such a public destruction of Bitcoin - let's say over the course of the next 2-3 years - sufficiently damage public trust in alternative cryptocurrencies to keep TPTB in control for the foreseeable future? It's a wager I'd trust them to make.

 

[Bagatell]

@freetrader If Google are in on it, so are TPTB.


edit; that is they are trying to co-opt it, not destroy it.

 

[cypherdoc]

@Peter R

hey, isn't that your Canadian economist friend that presented at Scaling HK? what's he doing there?

 

[rocks]

Bitfury doesn't have the balls to support Classic, but apparently wants to use them as bargaining chip?

Looks like HF has been stalled once again:


What does "HF code ready" mean anyway? It's a blank cheque for a HF in 2099...

Core might be over promising and making it sound that they are 3 months from a HF, when in reality it is just a stalling tactic as we all know.

If that is the case it should cause core to lose more credibility with miners when 3 months go by and they release HF code that won't activate for years....

We are seeing a significant flaw to bitcoin play out here. Control of bitcoin flows to whoever has the cheapest electricity (in this case artificially low Chinese subsidized electricity) and not to the many users. This is a long term problem.

I mentioned last summer the idea of a user led HF based on an economic majority of users. Given the support classic has had I think this is still something to consider, especially of we enter an artificial fee market which users reject.

The idea is gaining traction in reddit, there could be something here.

 

[Norway]

Night time in Hong Kong. And no official agreement yet.

 

[Peter R]

Well one good thing that has come out of this Hong Kong meeting is that the line between Core and Blockstream has become even finer: Blockstream's CEO appears to be the official spokesperson for Core.

***

On another note, we need to stop worrying about what the miners are doing, and focus again on getting the nodes to increase their acceptance limits. The miners can coordinate amongst themselves to raise the block size limit (or not)--like they always could.

The node operators need to increase their node's acceptance limits TODAY, by running a client like Bitcoin Unlimited. As more and more nodes do this, the miners will see that increasing the block size limit is just something they need to sort out between themselves. I know this GIF came across as political, but I think it is very much the truth:

I'm a bit frustrated because I believe we had the right idea (as well as good momentum) with Unlimited in December prior to the launch of Classic. When Olivier and Marshall reached out to me, and explained how miners were confused by BU and needed help coordinating this first block size limit increase, I agreed and said that I fully supported the project (and I still do). Gavin and I then discussed that the ideal situation would be for Classic to become a tool for the miners, while Unlimited became the client for non-mining node operators that weren't concerned about "big blocks." Instead, for some reason, node operators mostly migrated to Classic too!

The problem now is that there are over 1000 Classic nodes that will REJECT blocks > 1MB unless a certain activation sequence occurs. If for some reason, miners coordinate to increase their block size limits some other way (e.g., perhaps Core will try to do it differently), then those nodes will have to upgrade (possibly to Core) or risk forking themselves off the network. However, if they had run Unlimited instead, then it wouldn't matter!

TL/DR: the "coordination problem" only affects miners. Nodes can increase their acceptance limits TODAY.

 

[solex]

The problem now is that there are over 1000 Classic nodes that will REJECT blocks > 1MB unless a certain activation sequence occurs.

This is an extremely important point. We have already seen 700 XT nodes prepared to accept larger blocks, but get sidelined because the block version for activation was changed. There are still about 100 left which need upgrading. Every time node owners have to upgrade for the purpose of scalability which does not happen then it is only natural for them to get sick and tired of the process.

Expect that if Core are dragged into committing to an HF they will certainly not want to give Classic a 1000 node head-start. They will propose something different like 3MB and a new block version to make all the Classic nodes useless.

So far, BU is the only client which overcomes this problem. Gavin's intervention is clearer. He is thinking that if the non-miners ran software which was block-size agnostic then it is simply a case of the persuading miners to run code with the activation sequence. Unfortunately, we saw the BU count drop by 60% after Classic was launched. People changed to Classic because they wanted to give it momentum which would theoretically attract miners.

It does seem that the only force which can make the miners upgrade is the market price.

 

[chriswilmer]

Classic is looking like it's going the way of XT, and the price is rising a lot today... I just don't know what to think about Bitcoin these days. As with XT, I am disappointed in the attitude of the "leaders" (developers or otherwise) in not making communication (and campaigning) a priority. It was really bad with Mike, who seemed to think that it was enough to just release a client and that the rest would happen automatically. It seemed like the Classic team had a better sense of the importance of communication... but Gavin is quiet, jtoomim is quiet... and has anyone heard from Marshall Long? *sigh*

Anecdotally, I've been talking to what I consider super Bitcoin enthusiasts lately, and they usually have no idea what's going on. "Oh yeah, the blocksize debate, I hope that gets sorted soon. I'm sure those smart developers will figure out the technical details eventually." They don't realize this is about control...

 

[Zangelbert Bingledack]

@Zarathustra

If blocks do fill up immediately even with SW (possible because people may not use SW), then that is when the hard fork pressure will become overwhelming. The only question is how much annoying delay we get.

 

[chriswilmer]

Blocks may never fill up. The demand for Bitcoin transactions may just stagnate because of the limit.

https://bitcointalk.org/index.php?topic=1865.msg116523#msg116523

 

[Melbustus]

...
We are seeing a significant flaw to bitcoin play out here. Control of bitcoin flows to whoever has the cheapest electricity (in this case artificially low Chinese subsidized electricity) and not to the many users. This is a long term problem.
...

Luckily, I think that's actually a short/medium term problem. I would be surprised if in 10+ years, miners still compete mostly on raw electricity-cost*. As the ecosystem matures, they should compete on higher-order services, like in any mature market. This is going to cause hashpower to reflow out of China and into economies where there's more pressure and ability to innovate (not saying Chinese miners won't necessarily innovate; there'll just be a relative flow vs now).

We just have to hope that the current mining environment and consequent adherence to Core's broken economic thinking doesn't kill bitcoin's network-effect lead before we get that hashpower reflow.

Or instead of hoping, a leader in the ecosystem (Coinbase?) can sponsor a mining pool dedicated to innovation and actually scaling bitcoin rationally, in order to accelerate the process.

*consider that solar is potentially a great equalizer here, as it drives elec costs way down for everyone long-term.

 

[Peter R]

Classic is looking like it's going the way of XT, and the price is rising a lot today... I just don't know what to think about Bitcoin these days. As with XT, I am disappointed in the attitude of the "leaders" (developers or otherwise) in not making communication (and campaigning) a priority. It was really bad with Mike, who seemed to think that it was enough to just release a client and that the rest would happen automatically. It seemed like the Classic team had a better sense of the importance of communication... but Gavin is quiet, jtoomim is quiet... and has anyone heard from Marshall Long? *sigh*

Anecdotally, I've been talking to what I consider super Bitcoin enthusiasts lately, and they usually have no idea what's going on. "Oh yeah, the blocksize debate, I hope that gets sorted soon. I'm sure those smart developers will figure out the technical details eventually." They don't realize this is about control...

Yes, I agree that large-block proponents need to be campaigning. We need to be visiting with the biggest miners, exchanges, and other industry players until we achieve our goals. But how do we do that? I don't think any of the regulars here are influential enough to really make that happen. I think we'd need an industry group lead by Gavin, Jeff, Brian Armstrong, Stephen Pair, or perhaps even someone like Balaji or Wences. And we'd need money for campaigning!

I think many of us here could help in this process but we need to establish a more powerful group to drive it forward.

 

[solex]

Campaigning is important, but so is preparing the ground for a >1MB block.
The Relay Network needs to be upgraded to allow 2MB (or no limit blocks as it claims to relay not validate), or it needs to be made obsolete by miners using Xtreme thinblocks. Until one of those is achieved the campaign will be shackled.

 

[Peter R]

Apparently, this is the "consensus" from the meeting in Hong Kong:

https://medium.com/@bitcoinroundtable/bitcoin-roundtable-consensus-266d475a61ff#.or3nfdszi

Does not this statement mean "we will only run Blockstream-approved code"?