Post
Topic
Board Bitcoin Discussion
Re: Bitcoin XT - Officially #REKT (also goes for BIP101 fraud)
by
VeritasSapere
on 31/08/2015, 00:58:06 UTC
Nodes are important, but I do hope that you understand that it needs to be a trade off. Since what would be the point of running a full node if we do not even use the blockchain directly ourselves since we would need to rely on third parties since transacting on the main Bitcoin blockchain would become prohibitively expensive. How many people do you think would run these nodes for the banks, payment processors and like you say a few billionaires? I would argue that the opposite is true, if more people are using Bitcoin directly the more likely it will be that we will have more nodes. Arbitrarily restricting the amount of people that can use Bitcoin directly would therefore not lead to an increase in the amount of nodes. Furthermore in terms of access to governance nodes are not as important in terms of governance compared to the miners, and miners do not even run full nodes, that is why miners would not be effected by this change whatsoever.
BIP101 disincentives full nodes also.

How does increasing numbers of people using the blockchain directly not also disincentivise full nodes? (all under the most aggressive block increase proposal still standing that is BIP101, no less)

Miners do run full nodes, they couldn't mine transactions without access to the full blockchain history. Where you got that opposite idea from I do not know.
If there are more people using Bitcoin there will be more people running full nodes, I accept that it will be more difficult to run a full node however this does need to be a trade off, since the alternative would be much worse in terms of decentralization.

I am actually a miner myself, so I do know how mining works. Miners do not run full nodes, the pools do. All that is sent to the miners is the hash or the cryptographic problem that must be solved. This can be done across a 56K dial up connection, even if we had 8gig blocks, It would make no difference for the miners whatsoever. Since the pools can be setup in data centers with high bandwidth connections and favorable block propagation. Miners are free to point their mining power to whatever pool they want. The pools in this way function similarly to a Representative democracy. Since a free market of pools can exist and the miners would never be incentivized to allow one pool to grow so big that it would endanger the value proposition of Bitcoin. This is why I think that increasing the block size would not lead to increased mining centralization.

I have written about this in more detail here:
https://bitcointalk.org/index.php?topic=1164464.0