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The True Cost of Bitcoin Transactions

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Re: The True Cost of Bitcoin Transactions

#11

Post by joshontheweb »

knocte wrote: post #5
pmorici wrote: post #2

There is a small faction of the Bitcoin community working exceptionally hard to prevent any block size increase. I find their motives really baffling. They had some legitimate arguments a few years ago when discussion of this issue first started but those have all since been superseded by improvements in the protocol like xthin. They now resort to distasteful tactics by running anyone out of town that even so much as…

That's really baffling, I perceived quite the opposite.

Can you expound on why? I'm interested in hearing both sides of this.

Re: The True Cost of Bitcoin Transactions

#12

Post by pmorici »

hnolable wrote: post #4

If Eric was serious about this he would have targeted this post at chinese miners who are stalling on activating segwit (which is a 2x blocksize increase and the foundation for instant & nearly free txs via the Lightning Network).

Segwit is not a 2x block size increase. That is marketing spin that Blockstream started spreading to try and fool people into supporting their agenda w/o having to compromise and raise the block size. Segwit does _not_ increase the block size in the sense that people are discussing and in some cases it might even make the transaction throughput much worse than the current system.

The whole reason people want bigger blocks is for higher transaction throughput on-chain. Segwit doesn't deliver that.

https://np.reddit.com/r/Bitcoin/comments/5f507l/core_is_the_...

Re: The True Cost of Bitcoin Transactions

#13

Post by ac29 »

This article completely ignores the block reward -- the real cost per transaction is more like $7 [0]. The blocksize really needs to change too, last time I did a bitcoin transaction, every recent block was 95%+ full. Its an arbitrary limit, but its contentious and political to change. It really made me want to avoid Bitcoin in the future.

[0]https://blockchain.info/charts/cost-per-transaction

Re: The True Cost of Bitcoin Transactions

#14

Post by dpc59 »

pmorici wrote: post #10
knocte wrote: post #5

Earlier quoted context omitted.

That's really baffling, I perceived quite the opposite.

Based on what? Can you name a single dev that expresses support for bigger blocks that hasn't been systematically ridiculed and excluded from Bitcoin Core development by the small block crowd? It isn't even possible to get an accurate perception of Bitcoin Unlimited support from reading the traditional Bitcoin discussion forums like /r/bitcoin because there is ZERO tolerance for discussion of bigger blocks unless it…

I'm pretty sure this was a sarcastic shitcomment. People who have a basic idea of how finance works understand that decentralized financial products lead to market making.

Re: The True Cost of Bitcoin Transactions

#15

Post by danbruc »

And if you look at hardware, energy and all the other costs, then you probably still end up in the $5 to $10 range as true costs per transaction. But this will not become fully visible until the block reward becomes negligible or the demand for new coins becomes essentially zero so that the deflation becomes visible.

Re: The True Cost of Bitcoin Transactions

#16

Post by hnolable »

mhluongo wrote: post #8
hnolable wrote: post #4

If Eric was serious about this he would have targeted this post at chinese miners who are stalling on activating segwit (which is a 2x blocksize increase and the foundation for instant & nearly free txs via the Lightning Network).

Erm, targeted at? You mean he would have, what, written it in Chinese? Note he said most businesses are looking for Segwit activation + a hard fork blocksize increase (ours included). The "Chinese miners" have expressed that desire as well. Segwit is stalling because it's not what the market is asking for.

Segwit requires 95% of miners to activate. Currently about 75% of hash power is controlled by a group of chinese miners/pools. This is about the % of hashing power that is missing for Segwit to activate.

Re: The True Cost of Bitcoin Transactions

#17

Post by pmorici »

ac29 wrote: post #13

This article completely ignores the block reward -- the real cost per transaction is more like $7 [0]. The blocksize really needs to change too, last time I did a bitcoin transaction, every recent block was 95%+ full. Its an arbitrary limit, but its contentious and political to change. It really made me want to avoid Bitcoin in the future. [0] https://blockchain.info/charts/cost-per-transaction

The whole point of the block reward is to subsidize the network until transaction volume can grow to an equilibrium point where the network can be supported on fees alone. The fact that transaction volume is capped by the block size is troubling because it won't be able to grow to that equilibrium point.

Re: The True Cost of Bitcoin Transactions

#18

Post by steveklabnik »

pmorici wrote: post #2

There is a small faction of the Bitcoin community working exceptionally hard to prevent any block size increase. I find their motives really baffling. They had some legitimate arguments a few years ago when discussion of this issue first started but those have all since been superseded by improvements in the protocol like xthin. They now resort to distasteful tactics by running anyone out of town that even so much as…

> Eeveyone else is shadow banned.

On reddit, only admins can shadow ban, and they claimed that they stopped doing it over a year ago, in my understanding.

Re: The True Cost of Bitcoin Transactions

#19

Post by hnolable »

pmorici wrote: post #12
hnolable wrote: post #4

If Eric was serious about this he would have targeted this post at chinese miners who are stalling on activating segwit (which is a 2x blocksize increase and the foundation for instant & nearly free txs via the Lightning Network).

Segwit is not a 2x block size increase. That is marketing spin that Blockstream started spreading to try and fool people into supporting their agenda w/o having to compromise and raise the block size. Segwit does _not_ increase the block size in the sense that people are discussing and in some cases it might even make the transaction throughput much worse than the current system. The whole reason people want bigger b…

You can play semantical games but segwit gives about 2x onchain capacity. And the only thing holding it up is a group of chinese miners/pools. Anyone truly wanting more onchain capacity should be engaging those miners/pools.

Of course that's not really what people bitching about tx fees want.

Re: The True Cost of Bitcoin Transactions

#20

Post by pmorici »

danbruc wrote: post #15

And if you look at hardware, energy and all the other costs, then you probably still end up in the $5 to $10 range as true costs per transaction. But this will not become fully visible until the block reward becomes negligible or the demand for new coins becomes essentially zero so that the deflation becomes visible.

If what you say is true then that would imply that miners are losing money. I don't think that is the case. Total network hash rate has strong growth. People don't normally invest huge sums to turn a loss.
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