Re: Bitcoin XT - Officially #REKT (also goes for BIP101 fraud)
Will mining centralize around one single miner? No one knows. This is why Bitcoin is still a risk.
But if this doesn't happen--if there remains more than a single miner--then the fee market does exist.
I think the point of contention is really about this conclusion.But if this doesn't happen--if there remains more than a single miner--then the fee market does exist.
My understanding is that it may also happen with several miners if they have an incentive to synchronize their mempools (with a mechanism like IBLT).
Do you agree that this conclusion applies to the way the network is now and the way it has always been?
I ask, just because I want it to be clear to readers that this "point of contention" is about a hypothetical future scenario. And that we already know that there are hypothetical future scenarios, such as mining centralized around a single super pool, that would be bad for Bitcoin.
It absolutely doesnt. Miners already optimize for profit by centralizing in various ways. The recent SPV mining near-catastrophe was an excellent example.
Your conclusions hold under no existing and future scenario. It makes assumptions that are untenable and require absolute altruism from miners.
The crux of the issue is that miners incentives are not aligned with the network's users. The max block size cap mitigates the fact that they are expected (for security reasons) to prioritize financial profit over network decentralization. Yes, there might be no other way to align these incentives than by forcing it through consensus code.
What are the incentives for miners to centralised more than they currently are? The Ghash episode demonstrated that the market have no incentive for such a thing and have reacted accordingly. Ghash is now a thing of the past.
Miners' centralization is not only reflected by a combination of their hashpower.
The incentive is clear: mitigate costs derived from creating bigger blocks to capture more transactions fees
I am asking the incentives from a market perspective.
Reduce propagation costs of creating bigger blocks. They apparently are already doing it in some form under the existing block size.
What exactly do you mean by "from a market perspective"?
What incentives the users/businesses (those who ultimately give value to the coin) have for using a system being centralised by a single miner?