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Board Speculation
Re: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion
by
AlexGR
on 11/03/2016, 20:54:35 UTC
define "centralization"

I use these terms in a relative fashion, not absolute. This a p2p protocol which requires an extensive "p2p mesh" so to speak where a lot of people are running as peers, not clients dependent on some server. Decentralization = you want the network to be more on the p2p side rather than the client/server side. Centralization = the network tends to gravitate to a consolidated state where equal peers drop off and a few main central players are left standing.

Quote
you place way too much weight on spam. think of spam as a placeholder for legit TX, we welcome the placeholder because it pays some miner fees

Spam is the most wasteful symptom. However, given ample supply and low actual demand, the extremely cheap use of bitcoin's blockspace will not attract only spam, but also other systems on top of bitcoin that will use its transaction space as a ...cheap distributed storage system, where the costs burden the network nodes.

Thing is, if that happens, and as Satoshi said about the need to avoid DNS data being stored on the blockchain:

Piling every proof-of-work quorum system in the world into one dataset doesn't scale.

...now Satoshi understood the problem, however BTC is a data-agnostic protocol. Right? It doesn't know whether you are creating your own system and using it for storage, whether you are transacting, spamming, etc etc...

So how can you prevent the scenario where BTC's blockchain becomes a distributed-storage system that "doesn't scale", or, worse yet, a spam dumpster?

The only two ways are limiting block size and raising tx price.

As for now: If the fees were helping the network to sustain itself economically, which will be the case in some years, then we'll probably need a lot of txs. However this is not the case right now, since subsidy is like ...50-100 times larger than fees and mining can still be profitable as it is, or even ...more profitable with 0-tx blocks that avoid orphaning.