Quote from: jl2012 on February 22, 2013, 04:44:34 PM

Quote from: misterbigg on February 20, 2013, 08:09:15 PM

Quote from: Gavin Andresen on February 20, 2013, 07:38:16 PM

we should see what happens as we run into the soft blocksize limits...what do you predict will happen?

In this order:

1. Most blocks are at or near the 250 kilobyte soft limit.
2. The memory pool of transactions grows due to insufficient space in blocks.
3. Users notice trend of transactions taking longer to confirm, or not confirming at all.
4. Fees increase as users pay more to improve confirmation times.
5. Miners (or mining pools) modify code to select transactions with the highest fees per kilobyte to fit into blocks. They remote the 250 kilobyte soft limit. Some miners disallow free transactions entirely.
6. Transactions clear much more quickly now, but fees decrease.
7. Blocks increase in size until they are at or near the one megabyte hard limit.
8. Fees start increasing. Free transactions rarely confirm at all now.
9. Small transactions are eliminated since they are not economically feasible. SatoshiDice increases betting minimums along with fees. The volume of SatoshiDice transactions decrease.
10. Users at the margins of transaction profitability with respect to fees are pushed off the network.
11. Many people, most non-technical, clamor for the block size limit to be lifted.
12. Fees reach an equilibrium where they remain stable.
13. Spurred by the profitability of Bitcoin transactions, alternate chains appear to capture the users that Bitcoin lost.
14. Pleased with their profitability, miners refuse to accept any hard fork to block size.

While BTC/USD > 0
(15. Alternate chains become more and more popular.
16. People sell bitcoin and buy altcoins
17. BTC/USD exchange rate decreases. Profit of bitcoin mining decreases
18. Miners switch to SHA256 altcoins
19. Goto 15)
20. End of bitcoin

10a Use cases for Bitcoin decrease as more transactions types become economically not feasible
10b New investment in Bitcoin decreases as potential use cases decrease
10c Additional integration into Bitcoin decreases
10d Network effects decrease value in Bitcoin
10e BTC / USD drops

Ask Friendster what happens when you can't f'in scale. Anybody remember Friendster?