If this works as Peter describes, Bitcoin is basically worthless and has failed, because a minority…

Dennis, note how your list of participants does not include actual coin holders, who are getting screwed by higher transaction fees. If an individual cannot get transactions confirmed quickly and cheaply, she’s forced into an off-chain solution — an exchange or a settlement network, with unbounded economic, counterparty and privacy risks.

Your list also does not include the Core / Foundation “participant”. I assume that’s because you implicitly feel that there should not be a central developer entity that has a separate economic motive. Unfortunately, this has not been the case for a year.

When you side with exchanges and with settlement networks intent on using their patented technology, you are aligned against the actual “consumers” of the coin product — buyers and merchants, market makers and traders.

It is fortunate that majority of miners perceive that their economic interests are aligned with those of coin consumers, and have the ability, using the Bitcoin protocol as designed, to force some changes.

We all know how Big Banks and Visa will try hard to slap late fees and charges on individual consumers, by fiddling with small print in frequently updated agreements. Do realize that in this Great Bitcoin Rift you are siding with folks who want to fiddle with the code to become the Bitcoin equivalent of Visa.

P.S. I don’t have an economic interest either way, but it’s amazing to me that miners are feeling so strongly about the transaction volume, that they are explicitly fighting the entrenched Core [AKA Blockstream] — who own the mind share in the US and are professional smooth talkers.

Miners directly benefit from higher fees, even if minting fuller blocks and doubling of fees only increases their total per-block reward by less than 10 percent. But they are eager to forgo these fee increases, and are prepared to lose revenue, by throwing hash against an alternative chain. All to assure that the network grows in predictable incremental steps.

Blockstream folks are being greedy and impatient, having assumed that everyone will simply roll over and adopt. They should have bribed miners, say change the block reward in the code to 20 BTC, forever. Then add 1 BTC per-block to each: Foundation [who invented Bitcoin], Core[who actually test their Software], Dr. Back[who invented Cryptography], Dr. Maxwell[for his Good Looks], Blockstream, Inc[to expand their “Defensive Only” patent portfolio].

Raise maximum block size to 2 MB, to shut up the malcontents, and tie it to SegWit. Require 50% signaling for a day, and activate immediately. Get it adopted right away, and every side declares victory. Dr. Back gives an interview to WSJ, Dr. Maxwell to Vanity Fair, Blockstream is re-branded as UberStreamChat. And ‘users’ won’t even know the difference, and who cares anyways.

P.P.S I’m still interested in crypto-currencies, but for the time being Bitcoin is too much of an experiment in governance. Informative to watch, trading opportunities abound, but it’s tricky to base products on it.

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