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News Link • Blockchain

The Great Bitcoin compromise SegWit2MB

• Erik Voorhees

Bitcoin is in the middle of a civil war and the 2 fractions not seeking a compromise are both jocking for position. There are 2 confilicting camps the #segwit camp that seeks to compress transactions and the #bitcoinunlimited camp that seeks to increase block size. Both have positives and negative and each camp feels the need to disregard the other. I have long thought both were necessary for the long term. The new solution, #SegWit2MB, is being offered and Eric Voorhees explains technical and social the dynamics in crystal clear form and the importance of a compromise.

This could be the most important article in regards to the future of #bitcoin in its history   #Blockchain technology. #BitcoinCivilWar has stagnated the currency and a hard fork could destroy it or send message to the masses that the experiment has failed. It is my opinion that this compromise is the best way to move the Bitcoin consensus in a direction of unity and a soft fork, instead of division and disastrous hard fork. Erik Voorhees, I thank you personally for writing such a compelling piece! - Aho! Morpheus

Thoughts on SegWit2MB

On March 31, Sergio Lerner and the RootStock team proposed "SegWit2MB" to the Bitcoin Core mailing list.

The basics of the proposal…

95% miner support required for consensus

Upon consensus:

SegWit is immediately activated

2MB hardfork countdown begins (to occur Dec 14, 2017).

SegWit is Bitcoin Core's version (soft fork). The 2MB hardfork aspect is BIP 102, as coded by Jeff Garzik.

Stated plainly, SegWit2MB is a combination of SegWit and a hard fork to a 2MB base block size cap. The two are tied together such that 95% miner support triggers both.

What's the purpose? In Lerner's words, "Segwit2Mb is the project to merge into Bitcoin a minimal patch that aims to untangle the current conflict between different political positions regarding segwit activation vs. an increase of the on-chain blockchain space through a standard block size increase. It is not a new solution, but it should be seen more as a least common denominator."

And I'd like to make the case that it should be considered…

Status Quo: A State of Atrophy Nobody Wants

Let's start with some common ground: Bitcoin is immensely important. Can we still agree on that?

Society needs what we're building, not to be forced upon them, but rather offered; a kind and reliable refuge from the tyranny of the world's financial manipulators. That's why many of us are involved. That's why this project got off the ground.

Yet in the six years I've had the pleasure to be involved in this project, there has been a fundamental change in the community. The former friendship among strangers, a rare camaraderie derived from the justness of a great cause, has decayed into conflict.  We all see and feel this, and for those of us who truly care about this project, it is miserable. Perhaps many have even forgotten what the community felt like just a few years ago, when the enemy was not ourselves.

Bitcoin suffers now from a 2+ year impasse between angry factions. The anger has grown with the passing months. The cause of this impasse is a fundamental disagreement between large portions of the community (all claiming to be the important majority by one metric or another) over the technical path to scalability on the platform. Both sides have good arguments and bad arguments, and they've all become wound up in a horribly intricate knot. The rhetorical mess has become at least as bad as the underlying technical problem.

Further, the unfortunate context in which this is occurring is one of diminishing utility on the platform: transactions are getting more expensive and less reliable. The user experience of sending a Bitcoin transaction today is worse than it was two years ago. While the price has risen, fundamental utility has actually declined. This is unsustainable, and will be inevitably resolved by utility once again rising, or price declining to meet it.

Do not let yourself be tricked into thinking that the rising price implies fundamental soundness. Prices follow utility, and the latter may fall well before the former realizes it.

At the same time, innovation and growth on other blockchain platforms continues rapidly.  This doesn't mean any other blockchain is "better" than Bitcoin, but it does mean other blockchains are improving relatively faster than this one. Again, this will be inevitably resolved by Bitcoin gaining steam once again, or stagnating and awaiting its day in the court of market sentiment. If measurements matter, Bitcoin is at an all time low in market dominance relative to altcoins. Valuable members of the community have become disillusioned. While new people are always joining Bitcoin as it grows, at the same time some users are leaving partially or in full, preferring other projects that are more exciting to them, or simply less antagonistic.

There is clearly a problem, and we need to fix it.  A number of technical solutions have been proposed, but fundamentally while they may fix ills on the technical level, they ignore, dismiss, or worsen ills on the social level. They thus cannot be considered solutions… especially if they aren't happening.

The Hollow Blockchain

Bitcoin is a technical project, absolutely. Yet it is a social project as well. Some readers will scoff at that… but consider that a scoff is an emotional response, which actually proves the point.

Bitcoin, as a technical project, is a brilliant machine, but it is still a machine operated by and among people. Humans, with all their characters and personalities, are the complete benefactors and beneficiaries of this vast abacus. Without the human utility derived, the invention is irrelevant. Without the invention, the human utility is impossible. Indeed, the utility of money itself arises from our social needs; our desire to trade and exchange with each other fairly and without coercion or censorship is the ultimate purpose of Bitcoin. This is social.

To misunderstand Bitcoin as only technical is to dismiss its very purpose and utility. Regardless

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