List of bitcoin forks
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Questions about how Bitcoin currently works related to scaling as well as questions about the technical terminology related to the scaling discussion. Bitcoin Core bitcoin xt wikipedia initially released without an explicit block size limit. However, the code did limit network messages to a maximum of 32 MiB, setting an effective upper bound on block size.
Statements by Nakamoto in the summer of indicate he believed Bitcoin could scale to block sizes far larger than 1 megabyte. For example, on 5 Augusthe wrote that "[W]hatever size micropayments you need will eventually be practical. I think in 5 or 10 years, the bandwidth and storage will seem trivial" and "[microtransactions on the blockchain] can become more practical These statements suggest that the intended purpose of the 1 megabyte limit was not to keep bandwidth and storage requirements for running a Bitcoin node low enough to be practical for personal computers and consumer-grade internet connections, and that the limit was intended to be lifted to accommodate greater demand for transactional capacity.
Yet in one of Nakamoto's final public messages, he wrote that "Bitcoin users might bitcoin xt wikipedia increasingly tyrannical about limiting the size of the chain so it's easy for lots of users and small devices.
The current block size limit is 1, bytes 1 megabyte [9]although a small amount of that space such as the block header is not available to store transactions. The simple bitcoin xt wikipedia to calculate the number of Transactions Per Second TPS Bitcoin bitcoin xt wikipedia handle is to divide the block size limit by the expected average size of bitcoin xt wikipedia, divided by the average number of seconds between blocks For example, if you assume average transactions are bytes.
There seems to be general agreement that Bitcoin in can handle about 3 TPS with the current average size of transactions. Both old estimates [13] and new estimates [14] place the theoretical maximum at 7 TPS with current Bitcoin consensus rules including the 1MB block size limit. Big O notation is a shorthand used by computer scientists to describe how well a system scales. Such descriptions are rough approximations meant to help predict potential problems and evaluate potential solutions; they are not usually expected to fully capture all variables.
The following subsections show cases where big O notation has been applied to the scaling Bitcoin transaction volume. Bitcoin Core currently relays unconfirmed transactions and then later relays blocks containing many of the same transactions. This redundant relay can be eliminated to allow miners to propagate large blocks very quickly to active network nodes, and would also significantly reduce miner need for peak bandwidth.
Currently most miners use a network [15] that is about 25x more efficient than stock Bitcoin Core [16] and almost equally as effective as O 1 block propagation for current block sizes. While the validation effort required per full node simply grows in O nthe combined validation effort of all nodes grows by O n 2 with decentralization being held constant. For a single node, it takes twice as many resources to process the transactions bitcoin xt wikipedia twice as many users, while for all nodes it takes a combined four times as many resources to process the transactions of twice as many users assuming the number of full nodes increases in proportion to the number of users.
Each on-chain Bitcoin transaction needs to be processed by each full node. In short, this means that the aggregate cost of keeping all transactions on-chain quadruples each time the number of users doubles. Emphasis on the total validation resource requirements is suggested by some individuals bitcoin xt wikipedia be misleading, as they claim it obfuscates the growth of the supporting base of full nodes that the total validation resource effort is split amongst.
The validation resource effort made by each individual full node increases at O nand critics say this is the only pertinent fact with respect to scaling. Some critics also point out that the O n 2 network total validation resource requirements claim is assuming decentralization must be held constant as the network scales, and that this is not a founding principle of Bitcoin.
On-chain Bitcoin transactions are those that appear in the Bitcoin block chain. Off-chain transactions are those that transfer ownership of bitcoins without putting a transaction on the block chain.
When you create a Bitcoin transaction, you have the option to pay a transaction fee. This fee is comparable to a tip.
The higher it is, the bigger the incentive of the miners to incorporate your transaction into the next block. When miners assemble a block, they bitcoin xt wikipedia free to include whatever transactions they wish. They usually include as many as possible up to the maximum block size and then prioritize the transactions that pay the most fees per kilobyte of data. If blocks become full on a regular basis, users who pay a fee that's too small will have to wait a longer and longer time for their transactions to confirm.
At this point, a demand-driven fee market may arise where transactions that pay higher fees get confirmed significantly bitcoin xt wikipedia than transactions that pay low fees. In a competitive market, prices are driven by supply and demand and the emerging bitcoin xt wikipedia price asymptotically approaches marginal costs over time. However, the current version bitcoin xt wikipedia Bitcoin limits the supply to 1 MB per block, only allowing demand to adjust. To establish a free market, one would need to come up with a mechanism that allows the number of included transactions per block to adjust dynamically as well.
The design of such a mechanism, however, is not trivial. Simply allowing individual miners to include as many transactions as they want is problematic due to the externalities [23] of including additional blocks and explained further in section 'should miners be allowed to decide the block size?
Remove its decentralization properties, specifically decentralized mining and decentralized full nodes. Mining wastes enormous amounts of electricity to provide a decentralized ledger and full nodes waste an enormous amount of bandwidth and CPU time keeping miners honest. This is how Visa, MasterCard, PayPal, and the rest of the centralized payment systems works—users trust them, and they have no special difficulty scaling to millions of transactions an hour.
Bitcoin Core has historically come pre-configured to limit blocks it mines to certain sizes. It is commonly claimed [14] [27] that there are people opposed to bitcoin xt wikipedia raising the maximum block size limit, but no Bitcoin developers have suggested keeping the maximum block size at one megabyte forever. All developers support raising the maximum size bitcoin xt wikipedia some point [28] [29] —they just disagree about whether now is the correct time.
A block may include as little as a single transaction, so miners can always restrict block size. Letting miners choose the maximum block size is more problematic for several reasons:. The more active users of full bitcoin xt wikipedia, the harder it is for bitcoin xt wikipedia to trick users into accepting fake bitcoins or other frauds. Full nodes need to download and verify every block, and most nodes also store blocks plus relay transactions, full blocks, and filtered blocks to other users on the network.
The bigger blocks become, the more difficult it becomes to do all this, so it is bitcoin xt wikipedia that bigger blocks will both reduce the number of users who currently run full nodes and suppress the number of users who decide to start running a bitcoin xt wikipedia node later. In bitcoin xt wikipedia, full blocks may increase mining centralization [36] at a time when mining is already so centralized that it makes it easy to reverse transactions which have been confirmed multiple times.
Proof of work security is dependent on how much money miners spend on mining equipment. However, to effectively mine blocks, miners also need to spend money on bandwidth to receive new transactions and blocks created by bitcoin xt wikipedia miners; CPUs to validate received transactions and blocks; and bandwidth to upload new blocks.
As block sizes increase, the amount of bandwidth and CPU required also increases. If block sizes increase faster than the costs of bandwidth and CPU decrease, miners will have less money for POW security relative to the gross income they earn. In addition, larger blocks have a higher risk of becoming stale orphaned [41]which directly correlates to bitcoin xt wikipedia POW security.
Conversely, larger blocks that result in a lower per transaction fee can increase the demand for on-chain transactions, and result in total transaction fees earned by miners increasing despite a lower average transaction fee. This would increase network security by increasing the revenue that supports Proof of Work generation.
The required fee per transaction for bitcoin xt wikipedia current economic expenditure levels once the subsidy disappears decreases as the block size, and with it the maximum on-chain transaction throughput, increases. As a result of the sensitivity of demand to price increases, growth in the Bitcoin economy, and thus growth in the fees paid to secure the Bitcoin network, could be stunted if the block size is not allowed to increase sufficiently.
This is already the case more often than not [42]so we know that miners will simply queue transactions. The transactions eligible for bitcoin xt wikipedia inclusion that pay the highest fee per kilobyte will be confirmed earlier than bitcoin xt wikipedia that pay comparatively lower fees.
Basic economic theory bitcoin xt wikipedia us that increases in price reduce economic demand, ceteris paribus. Assuming that larger blocks would not cause a loss of demand for on-chain transaction processing due to a perceived loss of the network's decentralization and censorship resistance, blocks that are too small to include bitcoin xt wikipedia pending transactions will result in demand for on-chain transaction processing being less than it would be if blocks were large enough include all pending transactions.
Questions about the series of related proposals by Gavin Andresen and Mike Hearn to use a hard fork to raise the maximum block size, thereby allowing miners to include more on-chain transactions. As of Julythe current focus is BIP Bitcoin can support many bitcoin xt wikipedia users.
Bitcoin xt wikipedia earliest possible adoption, bytes per on-chain transaction, blocks per day, and 2 transaction a day per user, Bitcoin can support about.
The total cost of remaining decentralized will be high. Assuming earliest possible adoption and that the ratio of total users to full node operators remains bitcoin xt wikipedia same as today, the total estimated amount of work necessary to maintain the decentralized system under the O 2 scaling model will bitcoin xt wikipedia.
If all full nodes have upgraded, or very close to all nodes, there should be no practical effect. If a significant number of full nodes have not upgraded, they will continue using a different block chain than the upgraded users, with the following consequences:.
Users of hosted wallets Coinbase, BlockChain. Users of lightweight P2P SPV wallets will use the longest chain they know ofwhich may not be the actual longest chain if they only connect to nodes on the shorter chain. If a bad hard fork bitcoin xt wikipedia this happens, it bitcoin xt wikipedia likely cause large-scale confusion and make Bitcoin very hard to use until the situation is resolved.
That bitcoin xt wikipedia be highly unlikely. The longer it takes to upload a block, the higher the risk it will become a stale bitcoin xt wikipedia the miner who created it will not receive the block subsidy or transaction fees currently about 25 BTC per block. However, if technology like Invertible Bloom Lookup Tables IBLTs is deployed and found to work as expected [48]or if mining centralizes furtheradding bitcoin xt wikipedia transactions may not have a significant enough cost to discourage miners from creating full blocks.
In that case, blocks will be filled as soon as there are enough people wanting to make transactions paying the default relay fee [49] of 0. Note, BIP is the marketing bitcoin xt wikipedia for this proposal. No BIP number has yet been publicly requested, and the number assigned is unlikely to be Questions related to Jeff Garzik's proposal [14] to allow miners to vote on raising and lowering the maximum block bitcoin xt wikipedia.
Hard forks are most dangerous when they're bitcoin xt wikipedia without strong consensus. If Garzik's proposal gains strong consensus, it will be as safe as possible for a hard fork and it will allow increasing the block size up to 32 MB without any additional risk of bitcoin xt wikipedia fork. Questions related to using the proposed Lightning network as a way to scale the number of users Bitcoin can support.
Transactions on the proposed Lightning network use Bitcoin transactions exclusively to transfer bitcoins [54]and so the same security as regular Bitcoin transactions is provided when both a Lightning hub and client are cooperating. If one party waits too long to close the payment channel, the other party may be able to steal bitcoins.
However, it is possible to delegate the task of closing the channel in an emergency to an unlimited number of hubs around the Internet, so closing the channel on time should be easy.
In summary, provided that payment channels are closed on time, the worst that can happen to users is that they may have to wait a few weeks for a channel to bitcoin xt wikipedia close before spending the bitcoins they received from it.
Their security bitcoin xt wikipedia otherwise the same as with regular Bitcoin. Otherwise, Lightning hubs have the same security as clients. Lightning requires bitcoin xt wikipedia basic test implementation work bitcoin xt wikipedia [58]several soft-fork changes to the Bitcoin protocol work underway [59] [60]and wallets need to be updated to support the Lightning network protocol. Adam Back has said, "I expect we can get something running inside a year.
Lightning is bitcoin xt wikipedia neutral. It requires one on-chain transaction to open a channel between a hub and a client, and one on-chain transaction to close bitcoin xt wikipedia channel.
Using the numbers bitcoin xt wikipedia the Bitcoin xt wikipedia presentation [62]if people open and close a plausible two channels a year, Lightning can support about 52 million users with the current one-megabyte limit—and each user can make an unlimited number of transactions. Currently, assuming people make an average of only two Bitcoin transactions a day, basic Bitcoin can support onlyusers. Presumably, if around 30 million people are using Bitcoin via Bitcoin xt wikipedia so that capacity is called into question, it will not be difficult to find bitcoin xt wikipedia to double the block size to two megabytes and bring user capacity up to million.
