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Bitcoin will soon block small transaction outputs

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Re: Bitcoin will soon block small transaction outputs

#71

Post by harshreality »

ISL wrote: post #24
nwh wrote: post #3

Earlier quoted context omitted.

It's presumably only temporary measure, and only present in the reference client. Anything below four decimal places is completely worthless at this point anyway; do you really have a use for being able to send 0.01c USD?

If micropayments are ever to be possible, sub-penny transactions need to happen. If 10^6 people send you $0.001, you get $1k....

$.001 is so low it's not even worth talking about in terms of a globally visible transaction. Your bank won't let you transfer that amount. Why should bitcoin? You don't need to be able to transfer such amounts in order to have sub-1-cent microtransactions. You can have $.000001 cent microtransactions. You simply can't clear them in the global economy without batching them up... which people are used to doing already, because payment clearing services in gov currency have transaction charges that far exceed $.01.

Even if payment processing costs weren't an issue (which would cause many more small unbatched transactions in gov currency, similar to the crap being dumped into the block chain... banks have to log gov currency transactions for auditing purposes), whatever the cost of individual transactions, if you have a payor who owes you $.001 over a billing period, you've done something wrong. They'd be just as willing to pay you $.01 as $.001.

Re: Bitcoin will soon block small transaction outputs

#72

Post by venomsnake »

crapnowwhat wrote: post #66
venomsnake wrote: post #64

No central authority - well at least until we hit a small technological bump and it becomes mildly annoying - then we will solve the problem with a decree or fiat.

Update changes a hard coded limit to a setting with a default value. IE easily changeable. So it's more like a guideline. So basically they went in the opposite direction of a dictate with this release.

Every developer worth his salt knows that what is set as default stays as default for the majority of users.

Re: Bitcoin will soon block small transaction outputs

#73

Post by javert »

kolinko wrote: post #68
fizx wrote: post #29

Earlier quoted context omitted.

Encoding data into the blockchain isn't a bug--it's a feature (perhaps THE feature). When you want distributed consensus (e.g. for free-as-in-speech domain names), it's the only game in town. People should be able to put whatever data they want in the system, assuming they cover the cost.

The problem with "dust" transactions is that they do not cover the cost.

Well, miners can ignore transactions that have small fees or no fees. If there were not enough space in a block for all outstanding transactions, the transactions with the least fees will just be ignored.

So, there is an economic mechanism already in place to make sure dust transactions are paid for.

So that's not the problem that's being addressed.

EDIT: Well, actually, it's a "tragedy of the commons" situation. Having tons of dust transactions is seen as bad for Bitcoin (for reasons that are not yet 100% clear to me). So the devs think there is a need to dis-incentivize that. But the economic mechanism I explained above has not yet kicked in, so right now, you can make tons of dust transactions without having to directly pay for it. The burden of storing those small outputs for all time then falls on everybody who uses bitcoin.

Re: Bitcoin will soon block small transaction outputs

#74

Post by crapnowwhat »

venomsnake wrote: post #72
crapnowwhat wrote: post #66

Earlier quoted context omitted.

Update changes a hard coded limit to a setting with a default value. IE easily changeable. So it's more like a guideline. So basically they went in the opposite direction of a dictate with this release.

Every developer worth his salt knows that what is set as default stays as default for the majority of users.

For typical users I totally agree. My sense is that the miners who run the nodes probably are pretty comfortable tweaking settings. So as a developer who I dare say is worth his salt I'd agree with this regarding a general population, but not the group that's currently running the nodes.

Re: Bitcoin will soon block small transaction outputs

#75

Post by reeses »

kzrdude wrote: post #21
tocomment wrote: post #12

This sucks. I thought one of the killer apps for bitcoin was going to be micropayments. Oh well maybe the world will switch to litecoin.

It's been revealed before that bitcoin doesn't really do micropayments.. Not completely sure why. Block reward is also still far larger than transaction rewards, yet miners still enforce pretty large transaction fees.

It's particularly interesting given the extreme fractionizability of the btc. One would expect transactions in the extremely small range, especially as the precision can be increased even further if btc increases in value.

It is designed to support micropayments, but with the inefficient blockchain, the implementation does not support them.

Re: Bitcoin will soon block small transaction outputs

#76

Post by javert »

venomsnake wrote: post #64

No central authority - well at least until we hit a small technological bump and it becomes mildly annoying - then we will solve the problem with a decree or fiat.

An open source software project has to make policy decisions. They've been making these kinds of decisions for years. In fact, there used to be (a long time ago) a rule that outputs smaller than .01 BTC were not relayed.

The "no central authority" concept is from a different context, i.e., the fact that a decentralized Byzantine consensus type scheme is being used to guard against double-spends and to control minting, instead of an individual company or bank or government (i.e., "authority").

Plus, anybody can always fork Bitcoin.

Re: Bitcoin will soon block small transaction outputs

#77

Post by baby »

ISL wrote: post #24
nwh wrote: post #3

Earlier quoted context omitted.

It's presumably only temporary measure, and only present in the reference client. Anything below four decimal places is completely worthless at this point anyway; do you really have a use for being able to send 0.01c USD?

If micropayments are ever to be possible, sub-penny transactions need to happen. If 10^6 people send you $0.001, you get $1k....

> If 10^6 people send you $0.001, you get $1k....

Is this sarcasm?

0.01US$ might be worth nothing in the US, but might be worth something in some poorer countries.

Re: Bitcoin will soon block small transaction outputs

#78

Post by waterlesscloud »

harshreality wrote: post #71
ISL wrote: post #24

Earlier quoted context omitted.

If micropayments are ever to be possible, sub-penny transactions need to happen. If 10^6 people send you $0.001, you get $1k....

$.001 is so low it's not even worth talking about in terms of a globally visible transaction. Your bank won't let you transfer that amount. Why should bitcoin? You don't need to be able to transfer such amounts in order to have sub-1-cent microtransactions. You can have $.000001 cent microtransactions. You simply can't clear them in the global economy without batching them up... which people are used to doing already…

There are many things your bank simply won't let you do.

Is that now the guiding principle for Bitcoin?

Re: Bitcoin will soon block small transaction outputs

#79

Post by aneth4 »

javert wrote: post #70
witten wrote: post #61

Earlier quoted context omitted.

Why does the deposited amount of Bitcoin for smart property have to be a small value?

It doesn't have to be, but the larger the value is, the more bitcoin being "wasted" tracking smart property.

Bitcoin may be finite in number, but it's ultimately infinitely divisible, so it does not matter how many bitcoins are "wasted". Regardless, any property worth tracking in such a scheme is likely worth enough to justify a $0.01 investment in bitcoin.

Re: Bitcoin will soon block small transaction outputs

#80

Post by aneth4 »

GigabyteCoin wrote: post #31
tocomment wrote: post #12

This sucks. I thought one of the killer apps for bitcoin was going to be micropayments. Oh well maybe the world will switch to litecoin.

Funny, I always thought of it as a near perfect store of value and nothing more. The fact of the matter is that this is all Bitcoin has been used for so far (no company has used Bitcoins thus far for micropayments) so I think it will continue to evolve into an even more perfect store of value as time goes on.

There is no such thing as a perfect store of value that is nothing else. A store of value must have real value - for use as a material or as a medium of exchange. Otherwise, there is no value to store.

By this logic, any cryptographically strong series of bits is a perfect store of value.

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