The Optimal Block Size
In this article I will explain how the size of Bitcoin blocks is determined in the absence of an arbitrary size limit. Oleg has already written an excellent post on this topic, but I have a few things to add and I wish to relate the discussion to the current debate over increasing the block size. If the maximum limit on block size is removed, it is not the case that blocks will simply grow without limit. There is a natural size that is determined by the market. The block size will change until the marginal revenue of adding more transactions approaches the marginal cost; this could happen....
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This week, bitcoin Jesus Roger Ver weighed in on the block size debate stating that the block size limit should be increased if it is technologically achievable. Specifically, Ver tweeted: The block size debate has been underway for some time now and a lot of developers including Bitcoin Core Developers and the Bitcoin community are getting exasperated with the current impasse. In addition, many developers are now spending a lot of time and money seeking alternative solutions. If every 1MB block were always full, it would take over 55 years to fill my new HD. Let's raise the block size....
The founder of the Bitcoin Association Switzerland, Luzius Meisser, recently released the results of a block size survey he conducted. He wanted to test the differences in which entrepreneurial and technical mindsets viewed the block size problem. His hypothesis stated that entrepreneurs likely favor larger blocks than those of a technical mindset. “And the answer seems yes.” Of 269 respondents, 146 preferred a block size between 0.5 MB and unlimited, with most preferring more than 4GB. Meisser determines this is because he received more responses from r/btc readers than /r/bitcoin....
Chinese miners would not need to worry about explosive block size growth either, as the maximum rate of growth is capped at twice the previous size. There will be no jumps from 1MB blocks to 2MB blocks and then suddenly increasing to 8 MB. This should give the local Internet infrastructure enough time to ramp up the overall network speed and [try to] get rid of data caps. For those people looking to see the Bitcoin block size debate coming to an end, that will not be happening anytime soon, unfortunately. Things have gotten more interesting a few weeks ago when rumours....
Fresh out of jail on bail for embezzlement, disgraced Mt. Gox CEO Mark Karpeles poked fun at the Bitcoin community’s for their lack of resolution in the block size limit issue. Karpeles, in a tweet sent shortly after his release from jail, expressed his detachment from and disdain for the current state of Bitcoin, including a jab at the persisting one-megabyte block size limit debate: Block size limit still an issue, though drama has died down. The issue of whether or not to raise Bitcoin’s block size limit is a contentious one, responsible for a “splinter subreddit,” /r/btc, to emerge....
There seems to be no end in sight for the block size debate as the Bitcoin community continues to go around in circles trying to drive the same set of points home... The Bitcoin block size debate rages on. It has been almost a year since we started hearing the Bitcoin community fiercely contesting about whether to increase the bitcoin block size from the existing 1 MB or not. Both the sides have so far come up with some valid arguments, of which few are very convincing towards both the causes. Recently the “Jesus of Bitcoin”, Roger Ver wrote an article about why the Bitcoin block size....