The 35 Most Influential Bitcoiners Dominating Crypto ...
The 35 Most Influential Bitcoiners Dominating Crypto ...
SLP64 Tuur Demeester - What is Bitcoin Worth? A Bitcoin ...
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Tuur Demeester's bitcoin alpha fund Adamant Capital has ...
I'm Tuur Demeester, Bitcoin investor, economist and ...
Vitalik's response to Tuur
I interlaced everything between Vitalik and Tuur to make it easier to read.
1/ People often ask me why I’m so “against” Ethereum. Why do I go out of my way to point out flaws or make analogies that put it in a bad light?
2/ First, ETH’s architecture & culture is opposite that of Bitcoin, and yet claims to offer same solutions: decentralization, immutability, SoV, asset issuance, smart contracts, … Second, ETH is considered a crypto ‘blue chip’, thus colors perception of uninformed newcomers.
Agree! I personally find Ethereum culture far saner, though I am a bit biased :)
3/ I've followed Ethereum since 2014 & feel a responsibility to share my concerns. IMO contrary to its marketing, ETH is at best a science experiment. It’s now valued at $13B, which I think is still too high.
Not an argument
4/ I agree with Ethereum developer Vlad Zamfir that it’s not money, not safe, and not scalable. https://twitter.com/VladZamfistatus/838006311598030848 … @VladZamfir Eth isn't money, so there is no monetary policy. There is currently fixed block issuance with an exponential difficulty increase (the bomb).
I'm pretty sure Vlad would say the exact same thing about Bitcoin
5/ To me the first red flag came up when in our weekly hangout we asked the ETH founders about to how they were going to scale the network. (We’re now 4.5 years later, and sharding is still a pipe dream.)
The core principles have been known for years, the core design for nearly a year, and details for months, with implementations on the way. So sharding is definitely not at the pipe dream stage at this point.
6/ Despite strong optimism that on-chain scaling of Ethereum was around the corner (just another engineering job), this promise hasn’t been delivered on to date.
Sure, sharding is not yet finished. Though more incremental stuff has been going well, eg. uncle rates are at near record lows despite very high chain usage.
7/ Recently, a team of reputable developers decided to peer review a widely anticipated Casper / sharding white paper, concluding that it does not live up to its own claims.
Unmerciful peer review of Vlad Zamfir & co's white paper to scale Ethereum: "the authors do NOT prove that the CBC Casper family of protocols is Byzantine fault tolerant in either practice or theory".
8/ On the 2nd layer front, devs are now trying to scale Ethereum via scale via state channels (ETH’s version of Lightning), but it is unclear whether main-chain issued ERC20 type tokens will be portable to this environment.
Umm... you can definitely use Raiden with arbitrary ERC20s. That's why the interface currently uses WETH (the ERC20-fied version of ether) and not ETH
9/ Compare this to how the Bitcoin Lightning Network project evolved:
elizabeth stark @starkness: For lnd: First public code released: January 2016 Alpha: January 2017 Beta: March 2018…
10/ Bitcoin’s Lightning Network is now live, and is growing at rapid clip.
Jameson Lopp @lopp: Lightning Network: January 2018 vs December 2018
Sure, though as far as I understand there's still a low probability of finding routes for nontrivial amounts, and there's capital lockup griefing vectors, and privacy issues.... FWIW I personally never thought lightning is unworkable, it's just a design that inherently runs into ten thousand small issues that will likely take a very long time to get past.
11/ In 2017, more Ethereum scaling buzz was created, this time the panacea was “Plasma”.
12/ However, upon closer examination it was the recycling of some stale ideas, and the project went nowhere:
Peter Todd @peterktodd These ideas were all considered in the Treechains design process, and ultimately rejected as insecure.
Just because Peter Todd rejected something as "insecure" doesn't mean that it is. In general, the ethereum research community is quite convinced that the fundamental Plasma design is fine, and as far as I understand there are formal proofs on the way. The only insecurity that can't be avoided is mass exit vulns, and channel-based systems have those too.
13/ The elephant in the room is the transition to proof-of-stake, an “environmentally friendly” way to secure the chain. (If this was the plan all along, why create a proof-of-work chain first?)
@TuurDemeester "Changing from proof of work to proof of stake changes the economics of the system, all the rules change and it will impact everything."
Umm... we created a proof of work chain first because we did not have a satisfactory proof of stake algo initially?
14/ For the uninitiated, here’s a good write-up that highlights some of the fundamental design problems of proof-of-stake. Like I said, this is science experiment territory.
Yes, we know about weak subjectivity, see https://blog.ethereum.org/2014/11/25/proof-stake-learned-love-weak-subjectivity/. It's really not that bad, especially given that users need to update their clients once in a while anyway, oh and by the way even if the weak subjectivity assumption is broken an attacker still needs to gather up that pile of old keys making up 51% of the stake. And also to defend against that there's Universal Hash Time.
16/ Keep in mind that Proof of Stake (PoS) is not a new concept at all. Proof-of-Work actually was one of the big innovations that made Bitcoin possible, after PoS was deemed impractical because of censorship vulnerability.
Oh I definitely agree that proof of work was superior for bootstrap, and I liked it back then especially because it actually managed to be reasonably egalitarian around 2009-2012 before ASICs fully took over. But at the present time it doesn't really have that nice attribute.
17/ Over the years, this has become a pattern in Ethereum’s culture: recycling old ideas while not properly referring to past research and having poor peer review standards. This is not how science progresses.Tuur Demeester added,
I try to credit people whenever I can; half my blog and ethresear.ch posts have a "special thanks" section right at the top. Sometimes we end up re-inventing stuff, and sometimes we end up hearing about stuff, forgetting it, and later re-inventing it; that's life as an autodidact. And if you feel you've been unfairly not credited for something, always feel free to comment, people have done this and I've edited.
18/ One of my big concerns is that sophistry and marketing hype is a serious part of Ethereum’s success so far, and that overly inflated expectations have lead to an inflated market cap.
Ok, go on.
19/ Let’s illustrate with an example.
20/ A few days ago, I shared a critical tweet that made the argument that Ethereum’s value proposition is in essence utopian.
@TuurDemeester Ethereum-ism sounds a bit like Marxism to me:
What works today (PoW) is 'just a phase', the ideal & unproven future is to come: Proof-of-Stake.…
22/ My first point, about Ethereum developers rejecting Proof-of-Work, has been illustrated many times over By Vitalik and others. (See earlier in this tweetstorm for more about how PoS is unproven.)
Vitalik Non-giver of Ether @VitalikButerin: I don't believe in proof of work!
See above for links as to why I think proof of stake is great.
23/ My second point addresses Ethereum’s romance with the vague and dangerous notion of ‘social consensus’, where disruptive hard-forks are used to ‘upgrade’ or ‘optimize’ the system, which inevitably leads to increased centralization. More here:
See my rebuttal to Tuur's rebuttal :)
24/ My third point addresses PoS’ promise of perpetual income to ETHizens. Vitalik is no stranger to embracing free lunch ideas, e.g. during his 2014 ETH announcement speech, where he described a coin with a 20% inflation tax as having “no cost” to users.
Yeah, I haven't really emphasized perpetual income to stakers as a selling point in years. I actually favor rewards being as low as possible while still being high enough for security.
25/ In his response to my tweet, Vitalik adopted my format to “play the same game” in criticizing Bitcoin. My criticisms weren't addressed, and his response was riddled with errors. Yet his followers gave it +1,000 upvotes!
Vitalik Non-giver of Ether @VitalikButerin: - What works today (L1) is just a phase, ideal and unproven future (usable L2) is to come - Utopian concept of progress: we're already so confident we're finished we ain't needin no hard forks…
Ok, let's hear about what the errors are...
26/ Rebuttal: - BTC layer 1 is not “just a phase”, it always will be its definitive bedrock for transaction settlement. - Soft forking digital protocols has been the norm for over 3 decades—hard-forks are the deviation! - Satoshi never suggested hyperbitcoinization as a goal.
Sure, but (i) the use of layer 1 for consumer payments is definitely, in bitcoin ideology, "just a phase", (ii) I don't think you can make analogies between consensus protocols and other kinds of protocols, and between soft forking consensus protocols and protocol changes in other protocols, that easily, (iii) plenty of people do believe that hyperbitcoinization as a goal. Oh by the way: https://twitter.com/tuurdemeestestatus/545993119599460353
27/ This kind of sophistry is exhausting and completely counter-productive, but it can be very convincing for an uninformed retail public.
Ok, go on.
28/ Let me share a few more inconvenient truths.
29/ In order to “guarantee” the transition to PoS’ utopia of perpetual income (staking coins earns interest), a “difficulty bomb” was embedded in the protocol, which supposedly would force miners to accept the transition.
The intended goal of the difficulty bomb was to prevent the protocol from ossifying, by ensuring that it has to hard fork eventually to reset the difficulty bomb, at which point the status quo bias in favor of not changing other protocol rules at the same time would be weaker. Though forcing a switch to PoS was definitely a key goal.
30/ Of course, nothing came of this, because anything in the ETH protocol can be hard-forked away. Another broken promise.
33/ The modular approach to Bitcoin seems to be much better at compartmentalizing risk, and thus reducing attack surfaces. I’ve written about modular scaling here...
To be fair, risk is reduced because Bitcoin does less.
34/ Another huge issue that Ethereum has is with scaling. By putting “everything on the blockchain” (which stores everything forever) and dubbing it “the world computer”, you are going to end up with a very slow and clogged up system.
We never advocated "putting everything on the blockchain". The phrase "world computer" was never meant to be interpreted as "everyone's personal desktop", but rather as a common platform specifically for the parts of applications that require consensus on shared state. As evidence of this, notice how Whisper and Swarm were part of the vision as complements to Ethereum right from the start.
35/ By now the Ethereum bloat is so bad that cheaply running an individual node is practically impossible for a lay person. ETH developers are also imploring people to not deploy more smart contract apps on its blockchain.
Tuur Demeester @TuurDemeester: But... deploying d-apps on the "Ethereum Virtual Machine" is exactly what everyone was encouraged to do for the past 4 years. Looks like on-chain scaling wasn't such a great idea after all.
Umm.... I just spun up a node from scratch last week. On a consumer laptop.
36/ As a result, and despite the claims that running a node in “warp” mode is easy and as good as a full node, Ethereum is becoming increasingly centralized.
37/ Another hollow claim: in 2016, Ethereum was promoted as being censorship resistant…
Tuur Demeester @TuurDemeester: Pre TheDAO #Ethereum presentation: "uncensorable, code is law, bottom up". http://ow.ly/qW49302Pp92
Yes, the DAO fork did violate the notion of absolute immutability. However, the "forking the DAO will lead to doom and gloom" crowd was very wrong in one key way: it did NOT work as a precedent justifying all sorts of further state interventions. The community clearly drew a line in the sand by firmly rejecting EIP 867, and EIP 999 seems to now also be going nowhere. So it seems like there's some evidence that the social contract of "moderately but not infinitely strong immutability" actually can be stable.
38/ Yet later that year, after only 6% of ETH holders had cast a vote, ETH core devs decided to endorse a hard-fork that clawed back the funds from a smart contract that held 4.5% of all ETH in circulation. More here: ...
Hudson Jameson @hudsonjameson: The "semi-closed" Ethereum 1.x meeting from last Friday was an experiment. The All Core Dev meeting this Friday will be recorded as usual.
Suppose I were to tomorrow sign up to work directly for Kim Jong Un. What concretely would happen to the Ethereum protocol? I suspect very little; I am mostly involved in the Serenity work, and the other researchers have proven very capable of both pushing the spec forward even without me and catching any mistakes with my work. So I don't think any argument involving me applies. And we ended up deciding not to do more semi-closed meetings.
40/ Another red flag to me is the apparent lack of relevant expertise in the ETH development community. (Check the responses…)
I personally am confident in the talents of our core researchers, and our community of academic partners. Most recently the latter group includes people from Starkware, Stanford CBR, IC3, and other groups.
I have no idea who described Lucius Meredith's work as being important for the Serenity roadmap.... oh and by the way, RChain is NOT an "Ethereum scaling company"
42/ Perhaps the recently added Gandalf of Ethereum, with his “Fellowship of Ethereum Magicians” [sic] can save the day, but imo that seems unlikely...
Honestly, I don't see why Ethereum Gandalf needs to save the day, because I don't see what is in danger and needs to be saved...
43/ This is becoming a long tweetstorm, so let’s wrap up with a few closing comments.
44/ Do I have a conflict of interest? ETH is a publicly available asset with no real barriers to entry, so I could easily get a stake. Also, having met Vitalik & other ETH founders several times in 2013-’14, it would have been doable for me to become part of the in-crowd.
Agree there. And BTW I generally think financial conflicts of interest are somewhat overrated; social conflicts/tribal biases are the bigger problem much of the time. Though those two kinds of misalignments do frequently overlap and reinforce each other so they're difficult to fully disentangle.
45/ Actually, I was initially excited about Ethereum’s smart contract work - this was before one of its many pivots.
Tuur Demeester @TuurDemeester: Ethereum is probably the first programming language I will teach myself - who wouldn't want the ability to program smart BTC contracts?
Ethereum was never about "smart BTC contracts"..... even "Ethereum as a Mastercoin-style meta-protocol" was intended to be built on top of Primecoin.
46/ Also, I have done my share of soul searching about whether I could be suffering from survivor’s bias.
47/ Here’s why Ethereum is dubious to me: rather than creating an open source project & testnet to work on these interesting computer science problems, its founders instead did a securities offering, involving many thousands of clueless retail investors.
48/ Investing in the Ethereum ICO was akin to buying shares in a startup that had “invent time travel” as part of its business plan. Imo it was a reckless security offering, and it set the tone for the terrible capital misallocation of the 2017 ICO boom.
Nothing in the ethereum roadmap requires time-travel-like technical advancements or anything remotely close to that. Proof: we basically have all the fundamental technical advancements we need at this point.
49/ In my view, Ethereum is the Yahoo of our day - an unscalable “blue chip” cryptocurrency:
Tuur Demeester @TuurDemeester: 1/ The DotCom bubble shows that the market isn't very good at valuing early stage technology. I'll use Google vs. Yahoo to illustrate.
Newbs might not know this, but bitcoin recently came out of an intense internal drama. Between July 2015 and August 2017 bitcoin was attacked by external forces who were hoping to destroy the very properties that made bitcoin valuable in the first place. This culminated in the creation of segwit and the UASF (user activated soft fork) movement. The UASF was successful, segwit was added to bitcoin and with that the anti-decentralization side left bitcoin altogether and created their own altcoin called bcash. Bitcoin's price was $2500, soon after segwit was activated the price doubled to $5000 and continued rising until a top of $20000 before correcting to where we are today. During this drama, I took time away from writing open source code to help educate and argue on reddit, twitter and other social media. I came up with a reading list for quickly copypasting things. It may be interesting today for newbs or anyone who wants a history lesson on what exactly happened during those two years when bitcoin's very existence as a decentralized low-trust currency was questioned. Now the fight has essentially been won, I try not to comment on reddit that much anymore. There's nothing left to do except wait for Lightning and similar tech to become mature (or better yet, help code it and test it) In this thread you can learn about block sizes, latency, decentralization, segwit, ASICBOOST, lightning network and all the other issues that were debated endlessly for over two years. So when someone tries to get you to invest in bcash, remind them of the time they supported Bitcoin Unlimited. For more threads like this see UASF
Some thoughts about the possible Bitcoin Segwit, Bilderberg/AXA/BockStream/Core, In-Q-Tel, CIA connection.
I noticed a lot of people mentioning Bilderberg's connection to AXA and BlockStream, recently with Jeff Berwick's two videos going viral as seen here and here. It has been something I have been trying to warn people of for a while, and if you don't know what Bilderberg is you really need to watch this excellent documentary about it. The current chairman of the Bilderberg steering committee Henri de Castries was also CEO of AXA until he announced retirement in 2016. AXA is one of the main funders of BlockStream and Bitcoin Core development. As one of the biggest insurance companies in the world AXA also benefits from the legacy too-big-to-fail bailout system, and Bitcoin is a threat to their way of life. AXA are also funding technocratic totalitarian smart cities, where they team up with governments for full control. It is not surprising that they would want to get their fingers into Bitcoin. Now lets dig a little deeper. About 6 or 7 years ago, right before Satoshi disappeared, Gavin Andresen was invited to speak at the CIA. He got an invitation directly from In-Q-Tel the CIA's venture capitalist funding arm. Gavin mentions how In-Q-Tel reached directly out to him in this video @ 13sec mark (I am not endorsing the rest of the content of this video). In-Q-Tel basically helps fund and invest in companies that help equip the CIA with the latest information technology and capabilities. You can look on In-Q-Tel's website and see that they publicly invest in many innovative tech companies. Some of these are public, there are no crypto companies listed, but they also at times make private investments as well. Makes you wonder because they were interested enough to phone up Gavin Andresen personally and invite him for a speech, so in my opinion its highly likely they are investing somewhere in this space, and for what ends? We don't know. We do know that certain companies have captured the Core developers, and blocked common sense progress on Bitcoin, and that should be alarming. Further evidence that shows some type of coordination between these groups comes from Peter Thiel who has recently advocated against Bitcoin as a cash system, and instead is pushing it as a settlement system, the same narrative of BlockStream Core. It may also be interesting to know that Peter Thiel has also attended Bilderberg regularly and defends Bilderberg's secretive nature. Thiel also is partnering with In-Q-Tel and the CIA with his company Palantir, which spies on everybody. It is also interesting that at least one other VC funding firm Khosla Ventures invested in BlockStream, and also in the past has helped fund other companies that are working with In-Q-Tel. This was just from some quick research, only scratching the surface. I find these connections somewhat alarming, considering all of the community attacks I have seen going on. Its possible that some groups are trying to strangle and control and co-opt Bitcoin. It would make sense that they might try to force everyone off of the old model by jacking up fees, so users are herded onto something new in a 2nd layer solution that is more easily controlled. I believe segwit allows them to create an open door for trying to encourage Bitcoiners to move into their system, and the high fees is what they hope pushes users through that door. This is probably why we see so many attempts to move away from Satoshi's vision and the whitepaper. Its why we see such a lack of common sense to simply raise the blocksize capacity. Its why we see such draconian censorship, dirty tricks, lies, and diabolical political tactics. Ultimately I don't want to draw any final conclusions, but I feel these facts should be brought to the table for people to decide for themselves.
For the first time, well known Bitcoin maximalist Tuur Demeester given Ethereum some reasonable respect and attention - but be skeptical
For the first time, well known Bitcoin maximalist Tuur Demeester has given Ethereum some reasonable respect and attention - but be skeptical Demeester is a well-known maximalist, Technical Analysis B.S. pumper dumper, and he’s is not opposed to spreading misinformation in order to deter Ethereum’s success. While I would love to think that he’s finally coming to terms with the reality of the blockchain space, I remain quite skeptical. But coming from the position that everyone deserves more than second chances, I feel his recent Medium post is as close to even handed I’ve seen these highly biased maximalists get. Maybe he’s begun bargaining, or maybe this is just another ploy to setup a pump-dump ETC scam. We’ll see. To my surprise, there are several risks and benefits he highlights with Bitcoin and Ethereum that find very reasonable. However, while more even handed than normal for maximalists, there are quite a few holes in his medium post too. Here’s a few.
Ethereum is “Less backwards compatible”
I’m not sure what is meant by this. Without additional details, I can see arguments that support and reject this notion.
“On track towards a more centralized future”
If anything, Ethereum’s platform allow “decentralize all the things” far more than Bitcoin. Also, the Devs are quite a large consortium now, no longer an group lead by the Ethereum Foundation alone. The fact that these different groups get along and come to terms doesn’t mean they are centralized.
“Transaction finality is less certain”
If this is in reference to the DAO exploit fix, I’ll repeat a reference that highlights Bitcoin nonsensical arguments of Code is Law. The CVE attack, which while we could split hair as to whether it is the same thing, it is clear it means that Bitcoin, in its history, rolled back the entire fucking blockchain to fix an exploit. Ethereum never rolled back the blockchain; Etheruem only “reverse” a transaction. During Bitcoin’s rollback, mined coined were invalidated! Even those not attributed to the exploit. They literally rolled the blockchain back! Code is Law? Immutable? My ass! Now, Bitcoin’s rollback was needed, but my forceful language is to express how fucking stupid the Ethereum criticism is. Both were smart, community voted and decided, actions.
“Core dev Vlad Zamfir: Ethereum isn’t money, safe, or scalable” and the “different visions”
Vlad also noted that Ethereum “might be” safer than other blockchains, arguing that the entire space is experimental (this is quite a misrepresentation of his argument)
“unknown” doesn’t mean no information. The inflation rate is known to be trivial. This is the biggest strawman argument I’ve seen from maximalists. Value is supply and demand, and given the expected trivial issuance, Ethereum may end up deflationary. These are just from my quick read. The Flippening will happen. It can't be stopped anymore. It is great to see someone as maximalist as Demeester starting to come to terms (maybe). But what am I missing?
Bitcoin, huh? WTF is going on? Should we scale you on-chain or off-chain? Will you stay decentralized, distributed, immutable?
0. Shit, this is long, TLWR please! Too long, won't read. EDIT: TLDR TLWR for clarity.
Bitcoin is a decentralized, distributed, immutable network. It has users, nodes, and miners, all of which participate in building a public and pseudonymous ledger of blocks called blockchain. The blockchain requires its own currency to function and this currency is called Bitcoin.
The bitcoin network is going through growing pains. Some believe that it should be scaled on-chain with high-volume-low-cost transaction fees, whereas others believe that it has to be scaled off-chain with low-volume-high-cost transaction fees and more affordable second layer solutions. Each have relative advantages and disadvantages. A compromise has not been reached yet.
The off-chain scaling solution via Bitcoin Core SegWit’s lightning network diminishes distributed and immutable network properties. It replaces bitcoin’s peer-to-peer network with a two-layer institution-to-institution network and peer-to-hub-to-peer second layer solution.
The on-chain scaling solution via Bitcoin Cash’s increased block size limit is feasible at the moment but inefficient in the long run. It could be merged with several good concepts from the lightning network proposal and new ideas outlined in this overview.
An appropriate scaling analogy is to recall email attachments early on. They too were limited to a few MB at first, then 10MB, 20MB, up until 25MB on Gmail. But even then, Gmail eventually started using Google Drive internally.
Similarly, any second layer solutions should be integrated within the existing bitcoin network secured by miners and nodes. The revenue from any second layer solutions should be redistributed internally to miners and nodes, not to additional third party hubs which the lightning network envisions.
The author of this overview recommends on-chain scaling for the time being, with the understanding that off-chain scaling should be implemented as soon as possible, as long as these second layer solutions keep the bitcoin peer-to-peer and decentralized, distributed, immutable. Unfortunately, the lightning network does not accomplish this.
The author remains impartial to Bitcoin Core and Bitcoin Cash proposals, with a preference for Bitcoin Cash’s way of handling immutability and overall progress thus far.
1. Bitcoin, huh? Brief introduction. There are 3 sections to this overview. The first section is a brief introduction to bitcoin. The second section looks at recent developments in the bitcoin world, through the analogy of email attachments, and the third section discusses what could be next, through the perspective of resilience and network security. This is just a continuation of a long, long, possibly never-ending debate that started with the release of the bitcoin whitepaper in 2008 (see https://bitcoin.org/bitcoin.pdf). The recent mess during the past few years boils down to the controversy with the block size limit and how to appropriately scale bitcoin, the keyword appropriately. Scaling bitcoin is a controversial debate with valid arguments from all sides (see https://en.bitcoin.it/wiki/Block_size_limit_controversy). I have researched, studied, and written this overview as objectively and as impartially as possible. By all means, this is still an opinion and everyone is advised to draw their own conclusions. My efforts are to make at least a few readers aware that ultimately there is only one team, and that team is the team bitcoin. Yes, currently though, there are factions within the team bitcoin. I hope that we can get beyond partisan fights and work together for the best bitcoin. I support all scaling proposals as long as they are the best for the given moment in time. Personally, I hate propaganda and love free speech as long as it is not derogatory and as long as it allows for constructive discussions. The goal of this overview is to explain to a novice how bitcoin network works, what has been keeping many bitcoin enthusiasts concerned, and if we can keep the bitcoin network with three main properties described as decentralized, distributed, immutable. Immutable means censorship resistant. For the distinction between decentralized and distributed, refer to Figure 1: Centralized, decentralized and distributed network models by Paul Baran (1964), which is a RAND Institute study to create a robust and nonlinear military communication network (see https://www.rand.org/content/dam/rand/pubs/research_memoranda/2006/RM3420.pdf). Note that for the overall network resilience and security, distributed is more desirable than decentralized, and the goal is to get as far away from central models as possible. Of course, nothing is strictly decentralized or strictly distributed and all network elements are at different levels of this spectrum. For those unaware how bitcoin works, I recommend the Bitcoin Wikipedia (see https://en.bitcoin.it/wiki/Main_Page). In short, the bitcoin network includes users which make bitcoin transactions and send them to the network memory pool called mempool, nodes which store the public and pseudonymous ledger called blockchain and which help with receiving pending transactions and updating processed transactions, thus securing the overall network, and miners which also secure the bitcoin network by mining. Mining is the process of confirming pending bitcoin transactions, clearing them from the mempool, and adding them to blocks which build up the consecutive chain of blocks on the blockchain. The blockchain is therefore a decentralized and distributed ledger built on top of bitcoin transactions, therefore impossible to exist without bitcoin. If someone claims to be working on their own blockchain without bitcoin, by the definition of the bitcoin network however, they are not talking about the actual blockchain. Instead, they intend to own a different kind of a private database made to look like the public and pseudonymous blockchain ledger. There are roughly a couple of dozen mining pools, each possibly with hundreds or thousands of miners participating in them, to several thousand nodes (see https://blockchain.info/pools and https://coin.dance/nodes). Therefore, the bitcoin network has at worst decentralized miners and at best distributed nodes. The miner and node design makes the blockchain resilient and immune to reversible changes, making it censorship resistant, thus immutable. The bitcoin blockchain avoids the previous need for a third party to trust. This is a very elegant solution to peer-to-peer financial exchange via a network that is all: decentralized, distributed, immutable. Extra features (escrow, reversibility via time-locks, and other features desirable in specific instances) can be integrated within the network or added on top of this network, however, they have not been implemented yet. Miners who participate receive mining reward consisting of newly mined bitcoins at a predetermined deflationary rate and also transaction fees from actual bitcoin transactions being processed. It is estimated that in 2022, miners will have mined more than 90% of all 21 million bitcoins ever to be mined (see https://en.bitcoin.it/wiki/Controlled_supply). As the mining reward from newly mined blocks diminishes to absolute zero in 2140, the network eventually needs the transaction fees to become the main component of the reward. This can happen either via high-volume-low-cost transaction fees or low-volume-high-cost transaction fees. Obviously, there is the need to address the question of fees when dealing with the dilemma how to scale bitcoin. Which type of fees would you prefer and under which circumstances? 2. WTF is going on? Recent developments. There are multiple sides to the scaling debate but to simplify it, first consider the 2 main poles. In particular, to scale bitcoin on blockchain or to scale it off it, that is the question! The first side likes the idea of bitcoin as it has been until now. It prefers on-chain scaling envisioned by the bitcoin creator or a group of creators who chose the pseudonym Satoshi Nakamoto. It is now called Bitcoin Cash and somewhat religiously follows Satoshi’s vision from the 2008 whitepaper and their later public forum discussions (see https://bitcointalk.org/index.php?topic=1347.msg15366#msg15366). Creators’ vision is good to follow but it should not be followed blindly and dogmatically when better advancements are possible, the keyword when. To alleviate concerning backlog of transactions and rising fees, Bitcoin Cash proponents implemented a simple one-line code update which increased the block size limit for blockhain blocks from 1MB block size limit to a new, larger 8MB limit. This was done through a fork on August 1, 2017, which created Bitcoin Cash, and which kept the bitcoin transaction history until then. Bitcoin Cash has observed significant increase in support, from 3% of all bitcoin miners at first to over 44% of all bitcoin miners after 3 weeks on August 22, 2017 (see http://fork.lol/pow/hashrate and http://fork.lol/pow/hashrateabs). An appropriate scaling analogy is to recall email attachments early on. They too were limited to a few MB at first, then 10MB, 20MB, up until 25MB on Gmail. But even then, Gmail eventually started using Google Drive internally. Note that Google Drive is a third party to Gmail, although yes, it is managed by the same entity. The second side argues that bitcoin cannot work with such a scaling approach of pre-meditated MB increases. Arguments against block size increases include miner and node centralization, and bandwidth limitations. These are discussed in more detail in the third section of this overview. As an example of an alternative scaling approach, proponents of off-chain scaling want to jump to the internally integrated third party right away, without any MB increase and, sadly, without any discussion. Some of these proponents called one particular implementation method SegWit, which stands for Segregated Witness, and they argue that SegWit is the only way that we can ever scale up add the extra features to the bitcoin network. This is not necessarily true because other scaling solutions are feasible, such as already functioning Bitcoin Cash, and SegWit’s proposed solution will not use internally integrated third party as shown next. Note that although not as elegant as SegWit is today, there are other possibilities to integrate some extra features without SegWit (see /Bitcoin/comments/5dt8tz/confused_is_segwit_needed_for_lightning_network). Due to the scaling controversy and the current backlog of transactions and already high fees, a third side hastily proposed a compromise to a 2MB increase in addition to the proposed SegWit implementation. They called it SegWit2x, which stands for Segregated Witness with 2MB block size limit increase. But the on-chain scaling and Bitcoin Cash proponents did not accept it due to SegWit’s design redundancy and hub centralization which are discussed next and revisited in the third section of this overview. After a few years of deadlock, that is why the first side broke free and created the Bitcoin Cash fork. The second side stuck with bitcoin as it was. In a way, they inherited the bitcoin network without any major change to public eye. This is crucial because major changes are about to happen and the original bitcoin vision, as we have known it, is truly reflected only in what some media refer to as a forked clone, Bitcoin Cash. Note that to avoid confusion, this second side is referred to as Bitcoin Core by some or Legacy Bitcoin by others, although mainstream media still refers to it simply as Bitcoin. The core of Bitcoin Core is quite hardcore though. They too rejected the proposed compromise for SegWit2x and there are clear indications that they will push to keep SegWit only, forcing the third side with SegWit2x proponents to create another fork in November 2017 or to join Bitcoin Cash. Note that to certain degree, already implemented and working Bitcoin Cash is technically superior to SegWit2x which is yet to be deployed (see /Bitcoin/comments/6v0gll/why_segwit2x_b2x_is_technically_inferior_to). Interestingly enough, those who agreed to SegWit2x have been in overwhelming majority, nearly 87% of all bitcoin miners on July 31, 2017 prior to the fork, and a little over 90% of remaining Bitcoin Core miners to date after the fork (see https://coin.dance/blocks). Despite such staggering support, another Bitcoin Core fork is anticipated later in November (see https://cointelegraph.com/news/bitcoin-is-splitting-once-again-are-you-ready) and the "Outcome #2: Segwit2x reneges on 2x or does not prioritize on-chain scaling" seems to be on track from the perspective of Bitcoin Core SegWit, publicly seen as the original Bitcoin (see https://blog.bridge21.io/before-and-after-the-great-bitcoin-fork-17d2aad5d512). The sad part is that although in their overwhelming majority, the miners who support SegWit2x would be the ones creating another Bitcoin Core SegWit2x fork or parting ways from the original Bitcoin. In a way, this is an ironic example how bitcoin’s built-in resiliency to veto changes causes majority to part away when a small minority has status quo and holds off fully-consented progress. Ultimately, this will give the minority Bitcoin Core SegWit proponents the original Bitcoin branding, perhaps to lure in large institutional investors and monetize on bitcoin’s success as we have it seen it during the past 9 years since its inception. Recall that bitcoin of today is already a decentralized, distributed, immutable network by its definition. The bitcoin network was designed to be an alternative to centralized and mutable institutions, so prevalent in modern capitalist societies. Bitcoin Core SegWit group wants to change the existing bitcoin network to a network with dominant third parties which, unlike Google Drive to Gmail, are not internal. In particular, they intend to do so via the lightning network, which is a second layer solution (2L). This particular 2L as currently designed relies on an artificial block size limit cap which creates a bottleneck in order to provide high incentives for miners to participate. It monetizes on backlog of transaction and high fees, which are allocated to miners, not any group in particular. Cheaper and more instantaneous transactions are shifted to the lightning network which is operated by hubs also earning revenue. Note that some of these hubs may choose to monitor transactions and can possibly censor who is allowed to participate in this no longer strictly peer-to-peer network. We lose the immutability and instead we have a peer-to-hub-to-peer network that is mutable and at best decentralized, and certainly not distributed (see https://medium.com/@jonaldfyookball/mathematical-proof-that-the-lightning-network-cannot-be-a-decentralized-bitcoin-scaling-solution-1b8147650800). For regular day-to-day and recurring transactions, it is not a considerable risk or inconvenience. And one could choose to use the main chain any time to bypass the lightning network and truly transact peer-to-peer. But since the main chain has an entry barrier in the form of artificially instilled high transaction fees, common people are not able to use bitcoin as we have known it until now. Peer-to-peer bitcoin becomes institution-to-institution bitcoin with peer-to-hub-to-peer 2L. To reiterate and stress, note the following lightning network design flaw again. Yes, activating SegWit and allowing 2L such as lightning allows for lower transaction fees to coexist side by side with more costly on-chain transactions. For those using this particularly prescribed 2L, the fees remain low. But since these 2L are managed by hubs, we introduce another element to trust, which is contrary to what the bitcoin network was designed to do at the first place. Over time, by the nature of the lightning network in its current design, these third party hubs grow to be centralized, just like Visa, Mastercard, Amex, Discover, etc. There is nothing wrong with that in general because it works just fine. But recall that bitcoin set out to create a different kind of a network. Instead of decentralized, distributed, immutable network with miners and nodes, with the lightning network we end up with at best decentralized but mutable network with hubs. Note that Bitcoin Core SegWit has a US-based organization backing it with millions of dollars (see https://en.wikipedia.org/wiki/Blockstream and https://steemit.com/bitcoin/@adambalm/the-truth-about-who-is-behind-blockstream-and-segwit-as-the-saying-goes-follow-the-money). Their proponents are quite political and some even imply $1000 fees on the main bitcoin blockchain (see https://cointelegraph.com/news/ari-paul-tuur-demeester-look-forward-to-up-to-1k-bitcoin-fees). Contrary to them, Bitcoin Cash proponents intend to keep small fees on a scale of a few cents, which in large volume in larger blockchain blocks provide sufficient incentive for miners to participate. On the one hand, sticking to the original vision of peer-to-peer network scaled on-chain has merit and holds potential for future value. On the other hand, 2L have potential to carry leaps forward from current financial infrastructure. As mentioned earlier, 2L will allow for extra features to be integrated off-chain (e.g. escrow, reversibility via time-locks), including entirely new features such as smart contracts, decentralized applications, some of which have been pioneered and tested on another cryptocurrency network called Ethereum. But such features could be one day implemented directly on the main bitcoin blockchain without the lightning network as currently designed, or perhaps with a truly integrated 2L proposed in the third section of this overview. What makes the whole discussion even more confusing is that there are some proposals for specific 2L that would in fact increase privacy and make bitcoin transactions less pseudonymous than those on the current bitcoin blockchain now. Keep in mind that 2L are not necessarily undesirable. If they add features and keep the main network characteristics (decentralized, distributed, immutable), they should be embraced with open arms. But the lightning network as currently designed gives up immutability and hub centralization moves the network characteristic towards a decentralized rather than a distributed network. In a sense, back to the initial email attachment analogy, even Gmail stopped with attachment limit increases and started hosting large files on Google Drive internally, with an embedded link in a Gmail email to download anything larger than 25MB from Google Drive. Anticipating the same scaling decisions, the question then becomes not if but when and how such 2L should be implemented, keeping the overall network security and network characteristics in mind. If you have not gotten it yet, repeat, repeat, repeat: decentralized, distributed, immutable. Is it the right time now and is SegWit (one way, my way or highway) truly the best solution? Those siding away from Bitcoin Core SegWit also dislike that corporate entities behind Blockstream, the one publicly known corporate entity directly supporting SegWit, have allegedly applied for SegWit patents which may further restrict who may and who may not participate in the creation of future hubs, or how these hubs are controlled (see the alleged patent revelations, https://falkvinge.net/2017/05/01/blockstream-patents-segwit-makes-pieces-fall-place, the subsequent Twitter rebuttal Blockstream CEO, http://bitcoinist.com/adam-back-no-patents-segwit, and the subsequent legal threats to SegWit2x proponents /btc/comments/6vadfi/blockstream_threatening_legal_action_against). Regardless if the patent claims are precise or not, the fact remains that there is a corporate entity dictating and vetoing bitcoin developments. Objectively speaking, Bitcoin Core SegWit developers paid by Blockstream is a corporate takeover of the bitcoin network as we have known it. And on the topic of patents and permissionless technological innovations, what makes all of this even more complicated is that a mining improvement technology called ASICboost is allowed on Bitcoin Cash. The main entities who forked from Bitcoin Core to form Bitcoin Cash had taken advantage of patents to the ASICboost technology on the original bitcoin network prior to the fork (see https://bitcoinmagazine.com/articles/breaking-down-bitcoins-asicboost-scandal). This boost saved estimated 20% electricity for miners on 1MB blocks and created unfair economic advantage for this one particular party. SegWit is one way that this boost is being eliminated, through the code. Larger blocks are another way to reduce the boost advantage, via decreased rate of collisions which made this boost happen at the first place (see https://bitcoinmagazine.com/articles/breaking-down-bitcoins-asicboost-scandal-solutions and https://bitslog.wordpress.com/2017/04/10/the-relation-between-segwit-and-asicboost-covert-and-overt). Therefore, the initial Bitcoin Cash proponents argue that eliminating ASICboost through the code is no longer needed or necessary. Of course, saving any amount electricity between 0% and 20% is good for all on our planet but in reality any energy saved in a mining operation is used by the same mining operation to increase their mining capacity. In reality, there are no savings, there is just capacity redistribution. The question then becomes if it is okay that only one party currently and already holds onto this advantage, which they covertly hid for relatively long time, and which they could be using covertly on Bitcoin Cash if they desired to do so, even though it would an advantage to a smaller degree. To be fair to them, they are mining manufacturers and operators, they researched and developed the advantage from own resources, so perhaps they do indeed have the right to reap ASICboost benefits while they can. But perhaps it should happen in publicly know way, not behind closed doors, and should be temporary, with agreed patent release date. In conclusion, there is no good and no bad actor, each side is its own shade of grey. All parties have their own truth (and villainy) to certain degree. Bitcoin Cash's vision is for bitcoin to be an electronic cash platform and daily payment processor whereas Bitcoin Core SegWit seems to be drawn more to the ideas of bitcoin as an investment vehicle and a larger settlement layer with the payment processor function managed via at best decentralized third party hubs. Both can coexist, or either one can eventually prove more useful and digest the other one by taking over all use-cases. Additionally, the most popular communication channel on /bitcoin with roughly 300k subscribers censors any alternative non-Bitcoin-Core-SegWit opinions and bans people from posting their ideas to discussions (see https://medium.com/@johnblocke/a-brief-and-incomplete-history-of-censorship-in-r-bitcoin-c85a290fe43). This is because their moderators are also supported by Blockstream. Note that the author of this overview has not gotten banned from this particular subreddit (yet), but has experienced shadow-banning first hand. Shadow-banning is a form of censorship. In this particular case, their moderator robot managed by people moderators, collaboratively with the people moderators, do the following:
(1) look for "Bitcoin Cash" and other undesirable keywords,
(2) warn authors that “Bitcoin Cash” is not true bitcoin (which objectively speaking it is, and which is by no means “BCash” that Bitcoin Core SegWit proponents refer to, in a coordinated effort to further confuse public, especially since some of them have published plans to officially release another cryptocurrency called “BCash” in 2018, see https://medium.com/@freetrade68/announcing-bcash-8b938329eaeb),
(3) further warn authors that if they try to post such opinions again, they could banned permanently,
(4) tell authors to delete their already posted posts or comments,
(5) hide their post from publicly seen boards with all other posts, thus preventing it from being seeing by the other participants in this roughly 300k public forum,
This effectively silences objective opinions and creates a dangerous echo-chamber. Suppressing free speech and artificially blowing up transaction fees on Bitcoin Core SegWit is against bitcoin’s fundamental values. Therefore, instead of the original Reddit communication channel, many bitcoin enthusiasts migrated to /btc which has roughly 60k subscribers as of now, up from 20k subscribers a year ago in August 2016 (see http://redditmetrics.com/btc). Moderators there do not censor opinions and allow all polite and civil discussions about scaling, including all opinions on Bitcoin Cash, Bitcoin Core, etc. Looking beyond their respective leaderships and communication channels, let us review a few network fundamentals and recent developments in Bitcoin Core and Bitcoin Cash networks. Consequently, for now, these present Bitcoin Cash with more favorable long-term prospects.
(1) The stress-test and/or attack on the Bitcoin Cash mempool earlier on August 16, 2017 showed that 8MB blocks do work as intended, without catastrophic complications that Bitcoin Core proponents anticipated and from which they attempted to discourage others (see https://jochen-hoenicke.de/queue/uahf/#2w for the Bitcoin Cash mempool and https://core.jochen-hoenicke.de/queue/#2w for the Bitcoin Core mempool). Note that when compared to the Bitcoin Core mempool on their respective 2 week views, one can observe how each network handles backlogs. On the most recent 2 week graphs, the Y-scale for Bitcoin Core is 110k vs. 90k on Bitcoin Cash. In other words, at the moment, Bitcoin Cash works better than Bitcoin Core even though there is clearly not as big demand for Bitcoin Cash as there is for Bitcoin Core. The lack of demand for Bitcoin Cash is partly because Bitcoin Cash is only 3 weeks old and not many merchants have started accepting it, and only a limited number of software applications to use Bitcoin Cash has been released so far. By all means, the Bitcoin Cash stress-test and/or attack from August 16, 2017 reveals that the supply will handle the increased demand, more affordably, and at a much quicker rate.
(2) Bitcoin Cash “BCH” mining has become temporarily more profitable than mining Bitcoin Core “BTC” (see http://fork.lol). Besides temporary loss of miners, this puts Bitcoin Core in danger of permanently fleeing miners. Subsequently, mempool backlog and transaction fees are anticipated to increase further.
(3) When compared to Bitcoin Cash transaction fees at roughly $0.02, transaction fees per kB are over 800 times as expensive on Bitcoin Core, currently at over $16 (see https://cashvscore.com).
(4) Tipping service that used to work on Bitcoin Core's /Bitcoin a few years back has been revived by a new tipping service piloted on the more neutral /btc with the integration of Bitcoin Cash (see /cashtipperbot).
3. Should we scale you on-chain or off-chain? Scaling bitcoin. Let us start with the notion that we are impartial to both Bitcoin Core (small blocks, off-chain scaling only) and Bitcoin Cash (big blocks, on-chain scaling only) schools of thought. We will support any or all ideas, as long as they allow for bitcoin to grow organically and eventually succeed as a peer-to-peer network that remains decentralized, distributed, immutable. Should we have a preference in either of the proposed scaling solutions? First, let us briefly address Bitcoin Core and small blocks again. From the second section of this overview, we understand that there are proposed off-chain scaling methods via second layer solutions (2L), most notably soon-to-be implemented lightning via SegWit on Bitcoin Core. Unfortunately, the lightning network diminishes distributed and immutable network properties by replacing bitcoin’s peer-to-peer network with a two-layer institution-to-institution network and peer-to-hub-to-peer 2L. Do we need this particular 2L right now? Is its complexity truly needed? Is it not at best somewhat cumbersome (if not very redundant)? In addition to ridiculously high on-chain transaction fees illustrated in the earlier section, the lightning network code is perhaps more robust than it needs to be now, with thousands of lines of code, thus possibly opening up to new vectors for bugs or attacks (see https://en.bitcoin.it/wiki/Lightning_Network and https://github.com/lightningnetwork/lnd). Additionally, this particular 2L as currently designed unnecessarily introduces third parties, hubs, that are expected to centralize. We already have a working code that has been tested and proven to handle 8MB blocks, as seen with Bitcoin Cash on August 16, 2017 (see https://www.cryptocoinsnews.com/first-8mb-bitcoin-cash-block-just-mined). At best, these third party hubs would be decentralized but they would not be distributed. And these hubs would be by no means integral to the original bitcoin network with users, nodes, and miners. To paraphrase Ocam’s razor problem solving principle, the simplest solution with the most desirable features will prevail (see https://en.wikipedia.org/wiki/Occam%27s_razor). The simplest scalability solution today is Bitcoin Cash because it updates only one line of code, which instantly increases the block size limit. This also allows other companies building on Bitcoin Cash to reduce their codes when compared to Bitcoin Core SegWit’s longer code, some even claiming ten-fold reductions (see /btc/comments/6vdm7y/ryan_x_charles_reveals_bcc_plan). The bitcoin ecosystem not only includes the network but it also includes companies building services on top of it. When these companies can reduce their vectors for bugs or attacks, the entire ecosystem is healthier and more resilient to hacking disasters. Obviously, changes to the bitcoin network code are desirable to be as few and as elegant as possible. But what are the long-term implications of doing the one-line update repeatedly? Eventually, blocks would have to reach over 500MB size if they were to process Visa-level capacity (see https://en.bitcoin.it/wiki/Scalability). With decreasing costs of IT infrastructure, bandwidth and storage could accommodate it, but the overhead costs would increase significantly, implying miner and/or full node centralization further discussed next. To decrease this particular centralization risk, which some consider undesirable and others consider irrelevant, built-in and integrated 2L could keep the block size at a reasonably small-yet-still-large limit. At the first sight, these 2L would remedy the risk of centralization by creating their own centralization incentive. At the closer look and Ocam’s razor principle again, these 2L do not have to become revenue-seeking third party hubs as designed with the current lightning network. They can be integrated into the current bitcoin network with at worst decentralized miners and at best distributed nodes. Recall that miners will eventually need to supplement their diminishing mining reward from new blocks. Additionally, as of today, the nodes have no built-in economic incentive to run other than securing the network and keeping the network’s overall value at its current level. Therefore, if new 2L were to be developed, they should be designed in a similar way like the lightning network, with the difference that the transaction processing revenue would not go to third party hubs but to the already integrated miners and nodes. In other words, why do we need extra hubs if we have miners and nodes already? Let us consider the good elements from the lightning network, forget the unnecessary hubs, and focus on integrating the hubs’ responsibilities to already existing miner and node protocols. Why would we add extra elements to the system that already functions with the minimum number of elements possible? Hence, 2L are not necessarily undesirable as long as they do not unnecessarily introduce third party hubs. Lastly, let us discuss partial on-chain scaling with the overall goal of network security. The network security we seek is the immutability and resilience via distributed elements within otherwise decentralized and distributed network. It is not inconceivable to scale bitcoin with bigger blocks as needed, when needed, to a certain degree. The thought process is the following:
(1) Block size limit:
We need some upper limit to avoid bloating the network with spam transactions. Okay, that makes sense. Now, what should this limit be? If we agree to disagree with small block size limit stuck at 1MB, and if we are fine with flexible block size limit increases (inspired by mining difficulty readjustments but on a longer time scale) or big block propositions (to be increased incrementally), what is holding us off next?
(2) Miner centralization:
Bigger blocks mean that more data will be transferred on the bitcoin network. Consequently, more bandwidth and data storage will be required. This will create decentralized miners instead of distributed ones. Yes, that is true. And it has already happened, due to the economy of scale, in particular the efficiency of grouping multiple miners in centralized facilities, and the creation of mining pools collectively and virtually connecting groups of miners not physically present in the same facility. These facilities tend to have huge overhead costs and the data storage and bandwidth increase costs are negligible in this context. The individual miners participating in mining pools will quite likely notice somewhat higher operational costs but allowing for additional revenue from integrated 2L described earlier will give them economic incentive to remain actively participating. Note that mining was never supposed to be strictly distributed and it was always at worst decentralized, as defined in the first section of this overview. To assure at best a distributed network, we have nodes.
(3) Node centralization:
Bigger blocks mean that more data will be transferred on the bitcoin network. Consequently, more bandwidth and data storage will be required. This will create decentralized nodes instead of distributed ones. Again, recall that we have a spectrum of decentralized and distributed networks in mind, not their absolutes. The concern about the node centralization (and the subsequent shift from distributed to decentralized network property) is valid if we only follow on-chain scaling to inconsiderate MB values. If addressed with the proposed integrated 2L that provides previously unseen economic incentives to participate in the network, this concern is less serious. Furthermore, other methods to reduce bandwidth and storage needs can be used. A popular proposal is block pruning, which keeps only the most recent 550 blocks, and eventually deletes any older blocks (see https://news.bitcoin.com/pros-and-cons-on-bitcoin-block-pruning). Block pruning addresses storage needs and makes sure that not all nodes participating in the bitcoin network have to store all transactions that have ever been recorded on the blockchain. Some nodes storing all transactions are still necessary and they are called full nodes. Block pruning does not eliminate full nodes but it does indeed provide an economic incentive for the reduction and centralization (i.e. saving on storage costs). If addressed with the proposed integrated 2L that provides previously unseen economic incentives to participate in the network, this concern is less serious. In other words, properly designed 2L should provide economic incentives for all nodes (full and pruned) to remain active and distributed. As of now, only miners earn revenue for participating. The lightning network proposes extra revenue for hubs. Instead, miner revenue could increase by processing 2L transactions as well, and full nodes could have an economic incentive as well. To mine, relatively high startup costs is necessary in order to get the most up to date mining hardware and proper cooling equipment. These have to be maintained and periodically upgraded. To run a full node, one needs only stable bandwidth and a sufficiently large storage, which can be expanded as needed, when needed. To run a full node, one needs only stable bandwidth and relatively small storage, which does not need to be expanded. Keeping the distributed characteristic in mind, it would be much more secure for the bitcoin network if one could earn bitcoin by simply running a node, full or pruned. This could be integrated with a simple code change requiring each node to own a bitcoin address to which miners would send a fraction of processed transaction fees. Of course, pruned nodes would collectively receive the least transaction fee revenue (e.g. 10%), full nodes would collectively receive relatively larger transaction fee revenue (e.g. 20%), whereas mining facilities or mining pools would individually receive the largest transaction fee revenue (e.g. 70%) in addition to the full mining reward from newly mined blocks (i.e. 100%). This would assure that all nodes would remain relatively distributed. Hence, block pruning is a feasible solution. However, in order to start pruning, one would have to have the full blockchain to begin with. As currently designed, downloading blockchain for the first time also audits previous blocks for accuracy, this can take days depending on one’s bandwidth. This online method is the only way to distribute the bitcoin blockchain and the bitcoin network so far. When the size of blockchain becomes a concern, a simpler distribution idea should be implemented offline. Consider distributions of Linux-based operating systems on USBs. Similarly, the full bitcoin blockchain up to a certain point can be distributed via easy-to-mail USBs. Note that even if we were to get the blockchain in bulk on such a USB, some form of a block audit would have to happen nevertheless. A new form of checkpoint hashes could be added to the bitcoin code. For instance, each 2016 blocks (whenever the difficulty readjusts), all IDs from previous 2015 blocks would be hashed and recorded. That way, with our particular offline blockchain distribution, the first time user would have to audit only the key 2016th blocks, designed to occur on average once in roughly 2 weeks. This would significantly reduce bandwidth concerns for the auditing process because only each 2016th block would have to be uploaded online to be audited. Overall, we are able to scale the bitcoin network via initial on-chain scaling approaches supplemented with off-chain scaling approaches. This upgrades the current network to a pruned peer-to-peer network with integrated 2L managed by miners and nodes who assure that the bitcoin network stays decentralized, distributed, immutable.
Note that the author u/bit-architect appreciates any Bitcoin Cash donations on Reddit directly or on bitcoin addresses 178ZTiot2QVVKjru2f9MpzyeYawP81vaXi bitcoincash:qp7uqpv2tsftrdmu6e8qglwr2r38u4twlq3f7a48uq (Bitcoin Cash) and 1GqcFi4Cs1LVAxLxD3XMbJZbmjxD8SYY8S (Bitcoin Core).
Yes, Bitcoin was always supposed to be gold 2.0: digital gold that you could use like cash, so you could spend it anywhere without needing banks and gold notes to make it useful. So why is Core trying to turn it back into gold 1.0? (112 points, 85 comments)
In October 2010 Satoshi proposed a hard fork block size upgrade. This proposed upgrade was a fundamental factor in many people's decision to invest, myself included. BCH implemented this upgrade. BTC did not. (74 points, 41 comments)
what do the following have in common: Australia, Canada, USA, Hong Kong, Jamaica, Liberia, Namibia, New Zealand, Singapore, Taiwan, Caribbean Netherlands, East Timor, Ecuador, El Salvador, the Federated States of Micronesia, the Marshall Islands, Palau, Zimbabwe (47 points, 20 comments)
BCH is victim to one of the biggest manipulation campaigns in social media: Any mention of BCH triggered users instantly to spam "BCASH".. until BSV which is a BCH fork and almost identical to it pre-November fork popped out of nowhere and suddenly social media is spammed with pro-BSV posts. (131 points, 138 comments)
LocalBitcoins just banned cash. It really only goes to show everything in the BTC ecosystem is compromised. (122 points, 42 comments)
The new narrative of the shills who moved to promoting bsv: Bitcoin was meant to be government-friendly (33 points, 138 comments)
PSA: The economical model of the Lightning Network is unsound. The LN will support different coins which will be interconnected and since the LN tokens will be transacted instead of the base coins backing them up their value will be eroded over time. (14 points, 8 comments)
94 points: ThomasZander's comment in "Not a huge @rogerkver fan and never really used $BCH. But he wiped up the floor with @ToneVays in Malta, and even if you happen to despise BCH, it’s foolish and shortsighted not to take these criticisms seriously. $BTC is very expensive and very slow."
87 points: tjonak's comment in A Reminder Why You Shouldn’t Use Google.
86 points: money78's comment in Tone Vays: "So I will admit, I did terrible in the Malta Debate vs @rogerkver [...]"
83 points: discoltk's comment in "Not a huge @rogerkver fan and never really used $BCH. But he wiped up the floor with @ToneVays in Malta, and even if you happen to despise BCH, it’s foolish and shortsighted not to take these criticisms seriously. $BTC is very expensive and very slow."
79 points: jessquit's comment in Ways to trigger a Shitcoin influencer Part 1: Remind them that’s it’s very likely they got paid to shill fake Bitcoin to Noobs
Newbs might not know this, but bitcoin recently came out of an intense internal drama. Between July 2015 and August 2017 bitcoin was attacked by external forces who were hoping to destroy the very properties that made bitcoin valuable in the first place. This culminated in the creation of segwit and the UASF (user activated soft fork) movement. The UASF was successful, segwit was added to bitcoin and with that the anti-decentralization side left bitcoin altogether and created their own altcoin called bcash. Bitcoin's price was $2500, soon after segwit was activated the price doubled to $5000 and continued rising until here we are today at $15000. During this drama, I took time away from writing open source code to help educate and argue on reddit, twitter and other social media. I came up with a reading list for quickly copypasting things. It may be interesting today for newbs or anyone who wants a history lesson on what exactly happened during those two years when bitcoin's very existence as a decentralized low-trust currency was questioned. Now the fight has essentially been won, I try not to comment on reddit that much anymore. There's nothing left to do except wait for Lightning and similar tech to become mature (or better yet, help code it and test it) In this thread you can learn about block sizes, latency, decentralization, segwit, ASICBOOST, lightning network and all the other issues that were debated endlessly for over two years. So when someone tries to get you to invest in bcash, remind them of the time they supported Bitcoin Unlimited.
Behind Lopp is Luke Martin (215.1K) from the Youtube show Venturecoinist.tv, Tuur Demeester (204.4K) of ... endorsement, or sponsorship of any products, services, or companies. Bitcoin.com does ... I'm Tuur Demeester, Bitcoin investor, economist and founder of Adamant Research. Ask me anything! (AMA Nov 26) Sun Nov 22, 2015 9:08 pm . Hi everyone, I'm an investor and economist, founder & editor-in-chief of Adamant Research. I was previously author of the Dutch financial newsletter MacroTrends, and started recommending Bitcoin as an ... — Tuur Demeester (@TuurDemeester) January 21, 2019. It is an interesting thought like the majority of mainstream attention has focused on Bitcoin as a currency and how it can challenge the current monetary system. If one clears the air and looks at a wider picture Bitcoin may have a much interesting future as a protocol than just a currency. Tuur Demeester AMA Posts: 19 Joined: Sun Oct 18, 2015 1:17 am Location: Americas. Re: I'm Tuur Demeester, Bitcoin investor, economist and founder of Adamant Research. Ask me anything! (AMA Nov 26) Fri Nov 27, 2015 2:13 am . Hi Tuur, Thanks for doing this AMA and for providing such valuable information and advice. You play a very important role ... Tuur Demeester's bitcoin alpha fund Adamant Capital has softly closed down. Judie Simms. August 7, 2020. Add comment. 1 min read. Adamant Capital’d AUM of about $10 million as it shut, Lescrauwaet advised The Block. Longtime bitcoin proponent Tuur Demeester's bitcoin ...
185 TIP. The Bitcoin Debate with Tuur Demeester & Erik Townsend
On the bull side, we have Tuur Demeester. Tuur has owned Bitcoin since it was $5 and he has become a global authority in the space with over 160,000 followers on social media. On the bear side, we ... The only financial TV that matters. Start a 14 day trial on Real Vision to watch this interview in full: https://rvtv.io/2MVA7Pc Tuur Demeester of Adamant Re... This interview is from a panel I recently hosted for Real Vision’s The Crypto Gathering event, with Nic Carter, Tuur Demeester, Robert Breedlove & Alex Leish... Tuur Demeester, Bitcoin/Macro Investor and Writer, and Founding Partner of Adamant Capital joins us in a very important macro-economic and investment discussion on how to assess Bitcoin’s value ... In this interview, I talk to Tuur Demeester; macro investor, analyst, business cycle expert and founding partner at Adamant Capital. We discuss his recent article The Bitcoin Reformation, Bitcoin ...