
Bitcoin: Soft block size limit reached - lignuist
https://bitcointalk.org/index.php?topic=149668.0
======
eof
I am not a developer for bitcoin, but I have been following along in #bitcoin-
dev and reading some of the forum threads. (most interesting conversation by
far is on freenode)

In pools/miners that are not blocking satoshi dice 70-95% of every block is
filled with SD transactions. Further, SD has upped their fees to get higher
priority.

Interestingly, the sentiment of the devs and the sentiment of the users is
_vastly_ different. It seems that the users are overwhelmingly pro SD, anti
filtering out SD transactions, and think this is just a nice test for bitcoin
and this type of transaction volume is inevitable anyway. (plus, they are of
the libertarian leaning in general).

Sentiment amongst the devs varies, but it does seem they all agree that SD is
abusing the blockchain. There is no reason SD can't remain provably fair and
have the same flow without spamming the blockchain; and, since they are
reusing addresses and acting in a such a way that their transactions _can_ be
trivailly tracked, there is no reason (in some of the devs' minds) to not
treat them as spam and filter out their transactions.

For their own part, the owners of SD have reportedly taken a "fix your shit"
attitude when asked to change their methods.

In any case, it has spurred a lot of discussion on "how" to raise the soft
limit; which is completely arbitrary, and many pools have already raised it
regardless. The real news is that the `hard` limit, which _will_ create a fork
is not even an order of magnitude away. No one wants to keep making hard
forks, so there is a lot of debate on how to best determine future block limit
size on a system wide scale.

For my own part, it is hard not to see SD as spamming/abusing the blockchain.
If I ran a mining pool or a hasher (I don't) I would block SD as Luke-jr does
by not including addresses into blocks that start with `1dice`. It's note
worthy that it would be essentially impossible (rather than trivial) to censor
SD transactions if they followed best practices.

It is also worth noting that there are whispers of SD transaction volume being
something of a conspiracy. I have not done any analysis on this; but what I
have heard is that the vast majority of SD transactions appear to be bots,
playing losing bets 24 hours a day. SD has issued stock, which is publicly
traded.

~~~
aneth4
How can you have a viable worldwide currency subject to "spamming the
blockchain"? The nice thing about gold and USD is they have no viable DOS
attack vectors.

What implications does this have on the future of bitcoin? Is it even possible
to have a reliable currency if anyone can create a crippling load on the
system?

~~~
eof
Well you determine what counts as spam and just don't propagate it. Fees are a
part of the process of keeping spam out of the blockchain. Some people also
count sending 'bitdust' as spam.. seemingly defined as anything less than 10k
satoshis (or 1/10,000th of a bitcoin--obviously that definition would have to
change over time if bitcoin continued to appreciate).

The real answer to your question though is 'off chain transactions' will
likely become the way a lot of debts are settled. It's trivially easy to
double spend coins that have been not confirmed into any blocks, so it's
inevitable that this type of fraud will become more prevalent. As such, it
makes things like 'buying coffee' with bitcoin really annoying, if I am going
to have to wait 2-15 minutes for my transaction to get confirmed into a block
it isn't really going to work. So B&M retailers will be forced to make their
customers wait for transactions to confirm, or risk getting scammed (which
breaks the whole "point" of bitcoin having lower fees than CCs).

Enter off-chain transactions. Retailers could either let you hold a balance
there, or, more likely.. someone will pop up with a competitive off-chain
transaction scheme; perhaps Ripple, perhaps something more like bitinstant;
where balances are demoninated in bitcoin and retrievable in bitcoin, but day-
to-day small transactions actually happen in a 'centralized' database and are
only written to the blockchain upon cashing out. (note this is exactly what is
happening with mtgox, where tons of coins exchange hands just within their
system that don't get written to the blockchain until you cash out your
coins).

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CJefferson
Reading the thread, the most interesting thing seems to be that this is a
problem partly caused by the website satoshidice.com, and several people are
adding special filtering to ignore any transactions performed by this website.

This immediately raises a large number of very interesting questions. I was
under the impression that the whole point of bitcoin was that it allowed
anonymous transfer of funds with no central authority. If some group of large
miner groups have the power to a) identify satoshidice, and then b) ignore
it's transactions, then what is the point of bitcoin?

~~~
Tuna-Fish
So long as there's someone who mines coins and who accepts satoshidice
transactions, they will eventually be completed. Being discriminated against
slows your transactions down, it does not prevent them.

The way the system is designed to deal with discriminating miners is to
_allow_ all discrimination (a miner can choose which txns to include based on
any criteria he/she wishes), but diluting their choices by having enough
miners.

SatoshiDice is actually very useful for the network, because it allows us to
test how it functions in a saturated environment long enough in advance that
we can make changes if they are needed.

~~~
larrydag
Yet this action does seem like collusion which was the oringal point. I didn't
know transactions could be excluded as well. Who's to say that in the future
miners could collude against certain merchants?

~~~
Nursie
Oh they could if they wanted, and if they knew what the addresses in use by
the merchant were. This could be made difficult by the merchant continually
generating new addresses. The merchant could also add a little sweetener
(transaction fee), and it feels pretty likely that a proportion of the wider
BTC community would overcome their (presumably) ethical concerns and process
the transactions anyway.

But yes, in principle, colluding miners could make life difficult for
merchants they dislike. This is one reason why a large and divers base of
miners is important to the BTC system.

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eric_bullington
The main complaint with Satoshi Dice is that most of their transactions are
not actually transferring any value (actually, they are transferring a tiny
bit of value if I understand correctly; I've never used SD). They're using the
Bitcoin system as a secure message system to notify everyone who lost a bet
(i.e., most betters). It seems to me that Satoshi Dice could very easily
create their own block chain to do this and just use it as poker chips, which
would take all the load of the Bitcoin system. Once you are "in" the virtual
currency system, it's quite easy to exchange currencies. The hard part is
getting your dollars in.

But Bitcoin would have run up against the block size limit at some point
anyway; the vast quantity of Satoshi Dice transactions have only accelerated
the confrontation of this dilemma. I actually appreciate the fact that Satoshi
Dice is effectively stress testing the system. Bitcoin block size is a serious
impediment to scaling up.

I wonder if Bitcoin core dev (and Google employee) Mike Hearn has consulted
with Jeffrey Dean and Sanjay Ghemawat about this issue. I know that Bitcoin
recently switched from Berkeley DB to leveldb for most of the client's
bookkeeping, which would have been a good opportunity for Mike to approach
them about this dilemma. However, I know that all the core Bitcoin devs are
already very capable, so I'm not sure if a technological solution to this
issue even exists. The answer may be more political (i.e., convincing all the
miners to go along with an idea).

<idlespeculation>On a related note, I wonder what the level of adoption of
Bitcoin is among Google employees. As mentioned above, Mike Hearn is a Google
employee and a long-term Bitcoin core dev. I would speculate that the level of
adoption is relatively high, which makes me also speculate about when Google
might start accepting Bitcoin. Anyone care to comment?</idlespeculation>

~~~
muyuu
I doubt Google as an organisation would accept Bitcoin unless the adoption was
overwhelming. Google Wallet is yet another data mining tool for them, and they
won't give that up easily.

Single reason I don't have a Nexus 4 is that I have to use Google Wallet and I
won't give Google my real name to link it to my account no matter how hard
they try.

~~~
eric_bullington
Unfortunately, I think you're correct here. I guess I'm hoping a cabal of
Bitcoin insiders will somehow convince the powers-that-be to start using btc,
but your interpretation is much more likely.

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tocomment
I'm not following this. Can someone dumb it down a bit?

~~~
runn1ng
There are too many bitcoin transactions, so the blocks are too big. The miners
have to be run with different settings to account for that.

I don't know what bitcoin proponents think will happen in the bitcoin future
when everyone will be payibg with it; the size of the block will quickly get
to megabytes.

Yeah, bitcoin doesn't scale well.

~~~
Karunamon
>bitcoin doesn't scale well

Meanwhile, average and available bandwidth and disk space goes up.

By the time the block chain breaks into the terabytes range, storage and
network technology will have advanced to the point where it's not a problem
anymore.

~~~
tocomment
Does every new user have to download the entire blockchain? That's a point I'm
not really clear on.

~~~
Rovanion
If you are hosting your own wallet and not using an online solution yes.

~~~
joezydeco
Do you know of an online wallet that seems to be reputable? I'm looking at
Coinbase at the moment.

~~~
Rovanion
Blockchain.info is quite popular. That's really all I know.

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tocomment
Upon further reading, it sounds almost like a supply and demand issue that
needs to be solved with an increase in transaction fees, no?

~~~
muyuu
Yes, one of the options is to let the market take care of it.

But then you cannot advertise Bitcoin transactions as free any more, as free
TXs will likely be lost at a non-negligible rate in the future.

Blocking Satoshidice is a temporary fix to give time to the developer
community to come up with a better plan. So is increasing the soft limit (we
are currently at 1/4 of the hard limit, doubling the soft limit will put as at
50% of it, and it will double the blockchain bloating rate).

~~~
skore
I think it's fair that "free TXs will likely be lost". That's really just the
market at work - If Satoshidice would pay proper fees, I bet those miners
would be very happy to lift their block. In a sense making it "worth their
effort".

Any P2P network dies when leeching of resources completely outweighs sharing
of resources. I think Bitcoin with its transaction fees has a very clever
mechanism to prevent that from happening.

~~~
asdfaoeu
Satoshi dice transactions pay relatively high fees and is probably the only
reason transactions have any fees at all. Miners already limit the number of
free transactions that are processed some (BTC guild) don't even process free
transactions. The problem is luke-jr's pool explicitly blocks transactions
including satoshi dice addresses. For whatever reason possibly to artificially
lower transaction fees to increase adoption. If the miners acted economically
this wouldn't be a problem.

~~~
skore
Ah, interesting!

I would still be curious whether it's just a matter of price, though. Surely
at _some_ point the miners couldn't resist processing the transactions?

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waterlesscloud
Bitcoin lead dev addresses the issue-
<https://bitcoinfoundation.org/blog/?p=135>

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tocomment
Another curiosity I had. Has anyone considered storing files in the block
chain?

Obviously it wouldn't be practical but it might help with censored files.

~~~
wereHamster
You can store ASCII in the blockchain. Has been done before:
<http://news.ycombinator.com/item?id=2830084>.

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aneth4
One can only imagine what ordinary folks who thought they'd be on the bleeding
edge in accepting bitcoin think of all this.

All this talk of spamming block chains, miners, soft-hard limits - word that
mean nothing to your average cowboy - can't be good for bitcoin's near future.

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tocomment
So could a miner mine more coins by settings their max block size lower?? Or
am I misunderstanding completely?

~~~
Tuna-Fish
No. Nearly all (99.9999% or thereabouts) of the work you need to do to mine
bitcoins is independent of the size of the block you mine. You want to run
large blocks to collect as much transaction fees as you want to.

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tocomment
In the case of a hard fork does an end user have to do anything to move their
coins or is it transparent?

