Quote from: casascius on March 24, 2013, 06:02:02 PM

I had this idea that I thought might be a real feasible way to scale Bitcoin in a manner that allows an infinite number of transactions (including small ones) to benefit from blockchain confirmation, which is a finite resource.

I think most everyone who understands Bitcoin understands that it's not sustainable for every node to hear and relay a 1 kilobyte message each time anybody anywhere buys a pack of gum or a soda pop, or reads a newspaper article. It's just not realistic and a terribly inefficient use of resources. We expect transaction fees to eventually be a controlling force as to what's worth putting in the block chain, and at some point, that fee is going to exceed the value of many of the micropayments people would like to put through Bitcoin, making on-blockchain transactions of such a size totally infeasible.

Why not batch them just like credit card transactions? You get a middle that's willing to deal in hundreds of thousands of tiny transactions and then process them as larger transactions every X time period. Granted you have the risk the transactions won't go through but that exists outside the bitcoin world too. Maybe to make these small batched transactions users need something like a verified address to engage in such transactions.