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Bitcoin – Potential Network Disruption on July 31st

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Re: Bitcoin – Potential Network Disruption on July 31st

#141
post #51

Earlier quoted context omitted.

With segwit, you can use http://lightning.network . Lightning network gives you essentially unlimited transaction speed.

Which doesn't actually exist yet, and doesn't solve the problem even theoretically: https://medium.com/@jonaldfyookball/mathematical-proof-that-...

The blog author and you need to learn about lighting network and graph theory.

Edit: responses to the specific "proof" you linked

https://medium.com/@murchandamus/i-have-just-read-jonald-fyo...

https://medium.com/@murchandamus/some-subsidiary-points-on-l...

Re: Bitcoin – Potential Network Disruption on July 31st

#142
post #51

Earlier quoted context omitted.

With segwit, you can use http://lightning.network . Lightning network gives you essentially unlimited transaction speed.

Which doesn't actually exist yet, and doesn't solve the problem even theoretically: https://medium.com/@jonaldfyookball/mathematical-proof-that-...

[deleted]

Re: Bitcoin – Potential Network Disruption on July 31st

#143
post #53

Well, that's a remarkably uninformative announcement. Here's an attempt at a neutral tl;dr from a Bitcoin amateur. Bitcoin is currently suffering from significant scaling problems, which lead to high transaction fees. Numerous proposals to fix the scaling issue have been proposed, the two main camps being "increase the block size" and "muddle through by discarding less useful data" (aka Segregated Witness/SegWit). Ho…

It is probably not possible to solve the scaling problems on-chain - a secure decentralized consensus on a global scale cannot be fast. Currently the bitcoin protocol processes about 7 transactions per second. Doubling the speed by doubling blocks will not make it much closer to the 50K transactions per second of a system like VISA. But it is probably possible to scale the transaction system off-chain - with https://…

While I agree that only increasing block size forever (or simply removing the size limit) doesn't seem reasonable in the long run, are we sure that segwit and the off-chain scaling solutions proposed today will really solve the long-term scaling issues of BTC?

All the practical "here's how lightning's going to work" papers I've read so far leave me very skeptical. Here's an example: http://diyhpl.us/wiki/transcripts/scalingbitcoin/hong-kong/o...

The Q-and-A at the end in particular is interesting:

>Q: On the last slide, one of the assumptions was 3 channels per person. Assuming payment channels wouldn't be useful for retail sales, because you don't want to buy a coffee just to open immediately. Is that correct?

>A: Joseph might expand on this. Let's say you buy a coffee. You're probably buying a coffee only once, right? Well, maybe the coffee is $5, and you put $50 into the channel and leave it open. Then someone else comes to the coffee shop and she does the same thing. But she has a channel with the grocery store. There's me, coffee shop, Alice, grocery store, they all have channels. When I go to the grocery store next time, I don't have to open a channel. Payments are routed.

>Q: It sounded like everybody would have to open new channels.

>A: I am guessing the mean is going to be 3, but it will probably be an exponential distribution. Most people will probably have 1 channel, and then some might have 100s of channels open.

I don't know about you but while on paper that might work I still see a lot of hand waving, guesswork and rather unsubstantiated assumptions. Why would I decide to "lock" $50 worth of Bitcoins when I buy a $5 coffee? What's the incentive for me to do this? Where does this estimate of 3 come from exactly, I see it repeated everywhere but I can't find the maths behind it?

Here's an interesting attempt at simulating a real-scale ligtning network (why aren't there more of these? Aren't we talking about a $40bn market cap currency here?): https://hackernoon.com/simulating-a-decentralized-lightning-...

The simulation is rather unrealistic and I'm not sure how to interpret its conclusions. It seems to kinda work but there are issues:

>133,401 micropayments were attempted and 3461 (2.6%) of these failed. For successful payments the median number of hops was 19 and the median total fees were 2 bits (0.000002 btc) or 32% of the value transferred.

Now it could be caused by a bad simulation rather than a real issue with Lightning network, but frankly I can't tell at this point.

I don't have a horse in this race but as seen from the outside it all looks a bit rushed and amateurish. I don't know the whole story though, maybe I'm just poorly informed.

Re: Bitcoin – Potential Network Disruption on July 31st

#144
To me, hashing power is not the process by which the outcome will be decided.

IMHO, the percentage of technical signalling will not even matter that much.

Two chains will get created quite quickly. And some BTC holders will try to take advantage of the situation.

Since transactions can get replayed on the other chain (and copying them from one chain to the other brings a stability advantage) the technical way things are going to occur is double-spending to different adresses.

... Which means services supporting different chains will be pitted against each other.

Users will empty out one wallet at the same time to one exchange on a chain they don't support, and to another address they control on the chain they support. In cashing out on the exchange, they will crash the market value of that chain.

... Which brings me to: exchanges should start signalling support and come to a consensus pretty quickly, in their own interest. They don't want to be the exchange everybody cashes out on.

Questions abound:

* Have they started signalling it?

* What software are they running?

* If you hold some BTCs: are you planning to double spend?

* How are you going to proceed?

* Which chain do you support, and how many BTC do you possess?

TL;DR: There will be a run. Exchanges will determine the outcome.

Re: Bitcoin – Potential Network Disruption on July 31st

#145
post #71

Earlier quoted context omitted.

I'm really tired of hearing the "increasing the block size won't suffice"-argument. Yes, increasing blocks to 10 MB won't give us VISA-scale, but it will allow Bitcoin to serve TEN TIMES AS MANY USERS! I can't believe how many otherwise intelligent people fail to see that this is desirable. It's like driving your car at 10 km/h per hour on the high-way and refusing to increase your speed because that would still not…

I think the car analogy is not quite correct. A car is able to dynamically change its velocity, bitcoin can't easylie do that. It would be much better to find a genereal solution that fix that problem altogether, instead of finding a solution that works for the next few years and might require future forks.

There is rarely a silver bullet, and I don't see one in the case of Bitcoin. Even if lightning network (which is what everyone who does not see the need for a block-size increase points to) was available today, we would need larger blocks to reach VISA-scale. The responsible thing to do is to increase the blocks as early as possible while we still are in "beta".

Re: Bitcoin – Potential Network Disruption on July 31st

#146
post #102
post #66

Earlier quoted context omitted.

No, that's not correct. In the case of the UASF, something very frightening is possible. If the UASF has majority economic support (unlikely) and also the miners do not support it, initially the UASF side will be behind, and there will be multiple chains. There will be the UASF chain and the normal chain. But since the UASF has more support, it'll have more block reward, and eventually it'll have more hashrate behind…

>The other chain completely implodes, and stops existing. Are you sure? If I'm not wrong, this isn't that much different from Ethereum/Ethereum Classic situation. Ethereum Classic's price is no where near Ethereum's but it is still maintaining a good position - 5th by Market Cap and 3rd by 24hr volume. You are saying the ALL of the mining power will eventually move over, but what if it doesn't the miners (85% of whom…

> Ethereum Classic's price is no where near Ethereum's but it is still maintaining a good position - 5th by Market Cap and 3rd by 24hr volume.

ETC's price is being pumped up (some more context can be found on /r/ethereum), in some cases by taking advantage of newcomers looking to get into the ETH craze, helped by the fact that the Ethereum Foundation doesn't seem interested in maintaining ownership how the word "Ethereum" is used. There's no real technological innovation or developer interest in ETC.

Re: Bitcoin – Potential Network Disruption on July 31st

#147

Well, that's a remarkably uninformative announcement. Here's an attempt at a neutral tl;dr from a Bitcoin amateur. Bitcoin is currently suffering from significant scaling problems, which lead to high transaction fees. Numerous proposals to fix the scaling issue have been proposed, the two main camps being "increase the block size" and "muddle through by discarding less useful data" (aka Segregated Witness/SegWit). Ho…

That's a much more informative post than the link, and yet, I still don't really understand all the jargon. But it also reinforces for me just how not ready for primetime BTC is, and it makes me think the appreciation over the past year is truly insane.

I would guess that the market value of Bitcoin will sink a bit due to the muddiness of this announcement. Which suggests that a centralized party (Bitcoin.org) has a great effect on Bitcoin after all, despite its appeal of being a decentralized currency.

Re: Bitcoin – Potential Network Disruption on July 31st

#148

Well, that's a remarkably uninformative announcement. Here's an attempt at a neutral tl;dr from a Bitcoin amateur. Bitcoin is currently suffering from significant scaling problems, which lead to high transaction fees. Numerous proposals to fix the scaling issue have been proposed, the two main camps being "increase the block size" and "muddle through by discarding less useful data" (aka Segregated Witness/SegWit). Ho…

I'd argue the other way. They didn't get involved in this mess and are just warning their users about possible disruption. What you wrote is your point of view which people might agree or disagree with.

Re: Bitcoin – Potential Network Disruption on July 31st

#149

Well, that's a remarkably uninformative announcement. Here's an attempt at a neutral tl;dr from a Bitcoin amateur. Bitcoin is currently suffering from significant scaling problems, which lead to high transaction fees. Numerous proposals to fix the scaling issue have been proposed, the two main camps being "increase the block size" and "muddle through by discarding less useful data" (aka Segregated Witness/SegWit). Ho…

That's a much more informative post than the link, and yet, I still don't really understand all the jargon. But it also reinforces for me just how not ready for primetime BTC is, and it makes me think the appreciation over the past year is truly insane.

the appreciation over the past year

*Speculation

Re: Bitcoin – Potential Network Disruption on July 31st

#150
post #61

Earlier quoted context omitted.

You skipped the option that's closest to consensus! SegWit2x has industry support and has a short enough window to lock-in before the Aug 1st UASF EDIT: Quick reference https://medium.com/@wintercooled/the-road-to-segwit-activati...

Though it has industry support, it does not have user support, because it does not have a working, tested implementation released. With less than 3 weeks until the fork triggers, I highly doubt they are going to get substantial user adoption by the time the fork triggers. One of the most amazing properties of Bitcoin is that it's completely user driven. When it comes to the fundamental consensus rules, no amount of h…

How do you define user support?

All the definitions I heard are able to be manipulated easily:

-The/r/bitcoin consensus? Is mainly in existence because of censorship

-User wallets online? Can be easily created with AWS instances

-Bitcoin core? Who decides these bunch of people are in charge to represent all users and not a bunch of other developers?

One obvious alternative is to let Bitcoin follow economic incentives: Bitcoin miners gain Bitcoin, so they have a vested interest that their income is and stays valuable. Thus why not let the miners decide. This is also the only place where you can't influence/manipulate Bitcoin easily.

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