In response to Bitmain Co-Founder, Jihan Wu’s statement that there was a need for size increases in order to reduce inevitable blockchain congestion; Adam Back, (HashCash Inventor and Blockstream CEO), explained that Bitcoin could increase block sizes midterm, (but only after thorough testing).
Open to the Idea of On-Chain Scaling
After what appeared to be opposition, Bitcoin’s Core Development Team is standing behind an active plan for on-chain scaling. In 2014, Back supported modest block size increases to 2MB, 4MB and 8MB over time. He still considers this a viable approach to the issue; until the industry, exchanges and platforms adopt second-layer payment methods.
Though open to the solution, however, most of the Bitcoin community and the Core Development Team don’t see block size increases as a viable long-term solution to scaling issues. All blockchain platforms have natural limits. There’s a built-in block size limit for every blockchain network that can’t be increased.
If Bitcoin’s Blockchain increased in size along with its user base, the block size would grow to a point where only one small group of nodes could verify transactions; leaving individual node operators out of the equation. This type of centralization isn’t healthy for any Blockchain network.
Blockchains as large as 10MB, 50MB and 100MB create environments where node operators don’t exist. As size increases, less people can store data, participate in the validation processes or act independently.
Because of this, developers have to plan and test before every block size increase. Developers should only carry out block size increases when it’s absolutely necessary and during a time when transaction fees are high; so there’s less network traffic.
Is this Really Going to Happen?
Though network transaction fees have risen to $1-$2 a transaction, this was triggered by the exodus of Bitcoin miners to Bitcoin Cash’s network. Hundreds of thousands of transactions weren’t confirmed, creating a 100 million byte mempool.
In addition, people are migrating to the Bitcoin Cash network causing its value to increase. Developers built the network with 8MB blockchains, which allow for faster transactions. Because of these features, the Bitcoin Cash Network naturally offers Bitcoin’s Core Network a bit of competition.
However, as more businesses get in line with SegWit to reduce fees by 35% and more miners return to Bitcoin, transaction fees should lessen. If during the mid-term, transaction fees become very high though, Back states that a block size increase is possible after exhaustive testing.
Do you think block size increases are a good thing? Why or why not? Chime in below!
Images courtesy of Pixabay and Wikimedia Commons
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