brg444
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Bitcoin replaces central, not commercial, banks


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August 30, 2015, 10:42:20 PM

In the outcome where the blocksize limit is lifted it doesn't matter who wants scarcity and whether or not they collaborate. As soon as the "artificial" scarcity cap is removed it enables the unlimited amount of resources competing for block creation to ignore the capacity of others and drive the creation of bigger and bigger blocks. No amount of pools or "majority" can discourage them from doing so. Their only deterrent is the orphan risk which becomes infinitely small as technology improves.

With the current limit of 1mb for the last 5 years, the vast majority of blocks averaged about 40% of this limit. Miners are incentivized to produce the tightest, efficient blocks  dependent upon tx's.  Its only in the last few months that tx'x are such that block sizes are tending to close on this limit.

Correct observation though there are a couple reasons to explain that, mainly:

1. Connectivity: orphan risks have been a considerable issue early on as connectivity between miners, nodes was not properly optimized and propagation delays were a concern. These risks have been considerably alleviated recently by different methods and generally by more centralization between miners. Chinese miners have a indeed a tendency to produce smaller blocks because of their inherent bandwidth issues.

2. General state of the ecosystem which still hasn't fully moved out of the amateurs phase. Don't get me wrong there is now various absolutely professional mining operations being ran but there is still enormous room for hardware corporations to move in and totally run the small players out of the game. These actors will not be deterred by bigger blocks and connectivity issues.