Undeterred in his attempt to fork the Bitcoin network, Gavin Andresen today posted an update to his blog in which he attempts to spread fear by implying users will switch to "substitute goods" or in other words an altcoin unless an increase to the blocksize is made. That portion of his update, bolding by USGavin himself, reads:
I'll try to restate a point from that post that it seems some people are missing: you can't maximize the total price paid for something by simply limiting the supply of that something, especially if there are substitute goods available to which people can switch.
Citing a need for a concrete plan, Andresen's proposal reads as such:
Current rules if no consensus as measured by block.nVersion supermajority.
Supermajority defined as: 800 of last 1000 blocks have block.nVersion == 4
Once supermajority attained, block.nVersion < 4 blocks rejected.
After consensus reached: replace MAX_BLOCK_SIZE with a size calculated based on starting at 2^24 bytes (~16.7MB) as of 1 Jan 2015 (block 336,861) and doubling every 6*24*365*2 blocks -- about 40% year-on-year growth. Stopping after 10 doublings.
The perfect exponential function:
size = 2^24 * 2^((blocknumber-336,861)/(6*24*365*2))
... is approximated using 64-bit-integer math as follows:double_epoch = 6*24*365*2 = 105120
(doublings, remainder) = divmod(blocknumber-336861, double_epoch)
if doublings >= 10 : (doublings, remainder) = (10, 0)
interpolate = floor ((2^24 << doublings) * remainder / double_epoch)
max_block_size = (2^24 << doublings) + interpolate
This is a piecewise linear interpolation between doublings, with maximum allowed size increasing a little bit every block.
But despite Andresen's claims for the need of a concrete plan to increase the blocksize limit before proceeding, he proves himself to be the shittiest concreter of all time by stating that he doesn't know how the security of the blockchain – arguably the most critical component to the ongoing health of the network – will be paid for in the future. Worse than that, Andresen is willing to risk the future of Bitcoin on possibilities he conjures up on the spot and which have no basis in reality. He reads:
So how will blockchain security get paid for in the future?
I honestly don't know. I think it is possible blocks containing tens of thousands of transactions, each paying a few millibits in fees (maybe because wallets round up change amounts to avoid creating dust and improve privacy) will be enough to secure the chain.
It is also possible big merchants and exchanges, who have a collective interest in a secure, well-functioning blockchain, will get together and establish assurance contracts to reward honest miners.
It is also possible that pigs might fly.
"I'll try to restate a point from that post that it seems some people are missing: you can't maximize the total price paid for something by simply limiting the supply of that something, especially if there are substitute goods available to which people can switch."
Gavin running an airline: "We can't possibly charge more than ~$2 for a first class seat on our flights!!! People will just switch to walking!!! Perhaps passengers will accidentally drop loose change between the cushions and we can make money that way!!!???"
Except there are NO substitute goods to which people can switch. This has been covered at length, by intelligent people Gavin and his crowd of idiots either don't read or don't comprehend.
I can see why a group of people might want to break Bitcoin to the degree such substitute goods exist. And I can see why they'd want it, too. And why they aren't ~ever~ going to get it, also.
As suspected, this is a clear case of yet another economic illiterate, vividly evidenced by this line, "especially if there are substitute goods available to which people can switch."
Of course, this argument is true if there are substitute goods but this is not the case in real life. There is only one Bitcoin Blockchain; there are no substitute goods for anyone to switch to.
Alt chains are not a substitute good for Bitcoin. They might have the same features or utility, but not the same market penetration, meaning that they are not a 1:1 substitute for Bitcoin which is the only sense that matters.
The problem here is that these changes are going forward without any consultation with anyone, as if the Blockchain is a private network owned by one person like someone who owns an IRC channel. If a single misguided individual can trash the Bitcoin network, this is a significant problem; not with the software, but with its governance system.
It simply is not good enough to say, "I'm not sure how it will all work if I make these changes". This clearly indicates that a massive risk is being taken with the network, in the spirit of reckless experimentation. Any Scientist will tell you that the scientific method does not work like this, and it is a matter of ethics that you do not experiment with people's lives; you use models and run tests on animals (in this case software simulation), not human beings.
In the hands of someone who only has the best interests of the network's users at heart, like the Linux Kernel developers, we could be assured that all changes are real improvements that don't impact anyone negatively. We would also be assured that the leader of the project is sure to turn down advances from the Security Services of the State or rich Crony Capitalists who want to usurp the network for their own ends, turning it into something only they can afford to mine and use in a modern reproduction of the banking system with them at the center.
Like the Linux Kernel, there are only a few men who have the requisite knowledge and skill to maintain the reference client in a way to keep it moving in the correct direction, without irresponsible, extreme and unnecessary unilateral risk taking. What is needed now is a White Knight, an incorruptible Linus of Bitcoin, just as rude, just as ferocious and uncompromising, with a proven record of eloquently standing up to the most powerful agents of the State on behalf of his clients, to protect the Bitcoin reference client and its ongoing development.
There is only one person to whom I could possibly be referring.
The "substitute goods for money" argument is particularly idiotic.
Hey, you know what ? Gold is a substitute good for dollars!!1
Agreed. We need Satoshi back.
(non native English here)
Luke Jr. said :
Are they all onboard? How is that possible? Is that true? Where is occurring a deeper discussion about this? In the dev email list? IRC #bitcoin-dev or bitcointalk.org? Or in the comments of qntra.net?
Also, if increasing the block size is not a good idea, are there a escape for scalability or another proposal? Or just let 1MB forever? What are the alternatives and what is the real implication of increase or not increase?