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To: Paul Iverson <piverson1024@gmail.com>,
	Bitcoin Protocol Discussion <bitcoin-dev@lists.linuxfoundation.org>
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Subject: Re: [bitcoin-dev] Total fees have almost crossed the block reward
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Every transaction is replace-by-fee capable already. Opt-in replace by =
fee as specified in BIP 125 is a fiction that held sway only while the =
income from fees or fee replacement was so much smaller than subsidy.

> On Dec 21, 2017, at 3:35 PM, Paul Iverson via bitcoin-dev =
<bitcoin-dev@lists.linuxfoundation.org> wrote:
>=20
> I agree with Greg.  What is happening is a cause for celebration: it =
is the manifestation of our long-desired fee market in action.  That =
people are willing to pay upwards of $100 per transaction shows the huge =
demand to transact on the world's most secure ledger. This is what =
success looks like, folks!
>=20
> Now that BTC is being phased out as a means of payment nearly =
everywhere (e.g., Steam dropping BTC as a payment option) (to be =
replaced with the more-suitable LN when ready), I'd propose that we =
address the stuck transaction issue by making replace-by-fee (RBF) =
ubiquitous.  Why not make every transaction RBF by default, and then =
encourage via outreach and education other wallet developers to do the =
same? =20
>=20
> The frustration with BTC today is less so the high-fees (people =
realize on-chain transactions in a secure decentralized ledger are =
necessarily costly) but by the feeling of helplessness when their =
transaction is stuck.  Being able to easily bump a transaction's fee for =
users who are in a hurry would go a long way to improving the user =
experience. =20
>=20
> Paul.
>=20
>=20
> On Thu, Dec 21, 2017 at 2:44 PM, Gregory Maxwell via bitcoin-dev =
<bitcoin-dev@lists.linuxfoundation.org =
<mailto:bitcoin-dev@lists.linuxfoundation.org>> wrote:
> Personally, I'm pulling out the champaign that market behaviour is
> indeed producing activity levels that can pay for security without
> inflation, and also producing fee paying backlogs needed to stabilize
> consensus progress as the subsidy declines.
>=20
> I'd also personally prefer to pay lower fees-- current levels even
> challenge my old comparison with wire transfer costs-- but we should
> look most strongly at difficult to forge market signals rather than
> just claims-- segwit usage gives us a pretty good indicator since most
> users would get a 50-70% fee reduction without even considering the
> second order effects from increased capacity.
>=20
> As Jameson Lopp notes, more can be done for education though-- perhaps
> that market signal isn't efficient yet. But we should get it there.
>=20
> But even independently of segwit we can also look at other inefficient
> transaction styles: uncompressed keys, unconfirmed chaining instead of
> send many batching, fee overpayment, etc... and the message there is
> similar.
>=20
> I've also seen some evidence that a portion of the current high rate
> congestion is contrived traffic. To the extent that it's true there
> also should be some relief there soon as the funding for that runs
> out, in addition to expected traffic patterns, difficulty changes,
> etc.
>=20
>=20
> On Thu, Dec 21, 2017 at 9:30 PM, Melvin Carvalho via bitcoin-dev
> <bitcoin-dev@lists.linuxfoundation.org =
<mailto:bitcoin-dev@lists.linuxfoundation.org>> wrote:
> > I asked adam back at hcpp how the block chain would be secured in =
the long
> > term, once the reward goes away.  The base idea has always been that =
fees
> > would replace the block reward.
> >
> > At that time fees were approximately 10% of the block reward, but =
have now
> > reached 45%, with 50% potentially being crossed soon
> >
> > https://fork.lol/reward/feepct <https://fork.lol/reward/feepct>
> >
> > While this bodes well for the long term security of the coin, I =
think there
> > is some legitimate concern that the fee per tx is prohibitive for =
some use
> > cases, at this point in the adoption curve.
> >
> > Observations of segwit adoption show around 10% at this point
> >
> > http://segwit.party/charts/ <http://segwit.party/charts/>
> >
> > Watching the mempool shows that the congestion is at a peak, though =
it's
> > quite possible this will come down over the long weekend.  I wonder =
if this
> > is of concern to some.
> >
> > https://dedi.jochen-hoenicke.de/queue/more/#24h =
<https://dedi.jochen-hoenicke.de/queue/more/#24h>
> >
> > I thought these data points may be of interest and are mainly FYI.  =
Though
> > if further discussion is deemed appropriate, it would be interesting =
to hear
> > thoughts.
> >
> > _______________________________________________
> > bitcoin-dev mailing list
> > bitcoin-dev@lists.linuxfoundation.org =
<mailto:bitcoin-dev@lists.linuxfoundation.org>
> > https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev =
<https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev>
> >
> _______________________________________________
> bitcoin-dev mailing list
> bitcoin-dev@lists.linuxfoundation.org =
<mailto:bitcoin-dev@lists.linuxfoundation.org>
> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev =
<https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev>
>=20
> _______________________________________________
> bitcoin-dev mailing list
> bitcoin-dev@lists.linuxfoundation.org
> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev


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	charset=us-ascii

<html><head><meta http-equiv=3D"Content-Type" content=3D"text/html; =
charset=3Dus-ascii"></head><body style=3D"word-wrap: break-word; =
-webkit-nbsp-mode: space; line-break: after-white-space;" class=3D"">Every=
 transaction is replace-by-fee capable already. Opt-in replace by fee as =
specified in BIP 125 is a fiction that held sway only while the income =
from fees or fee replacement was so much smaller than subsidy.<br =
class=3D""><div><br class=3D""><blockquote type=3D"cite" class=3D""><div =
class=3D"">On Dec 21, 2017, at 3:35 PM, Paul Iverson via bitcoin-dev =
&lt;<a href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" =
class=3D"">bitcoin-dev@lists.linuxfoundation.org</a>&gt; wrote:</div><br =
class=3D"Apple-interchange-newline"><div class=3D""><div dir=3D"ltr" =
class=3D"">I agree with Greg.&nbsp; What is happening is a cause for =
celebration: it is the manifestation of our long-desired fee market in =
action.&nbsp; That people are willing to pay upwards of $100 per =
transaction shows the huge demand to transact on the world's most secure =
ledger. This is what success looks like, folks!<div class=3D""><br =
class=3D""></div><div class=3D"">Now that BTC is being phased out as a =
means of payment nearly everywhere (e.g., Steam dropping BTC as a =
payment option) (to be replaced with the more-suitable LN when ready), =
I'd propose that we address the stuck transaction issue by making =
replace-by-fee (RBF) ubiquitous.&nbsp; Why not make every transaction =
RBF by default, and then encourage via outreach and education other =
wallet developers to do the same?&nbsp;&nbsp;</div><div class=3D""><br =
class=3D""></div><div class=3D"">The frustration with BTC today is less =
so the high-fees (people realize on-chain transactions in a secure =
decentralized ledger are necessarily costly) but by the feeling of =
helplessness when their transaction is stuck.&nbsp; Being able to easily =
bump a transaction's fee for users who are in a hurry would go a long =
way to improving the user experience.&nbsp;&nbsp;</div><div =
class=3D""><div class=3D""><br class=3D""></div><div =
class=3D"">Paul.</div><div class=3D""><br =
class=3D""></div></div></div><div class=3D"gmail_extra"><br =
class=3D""><div class=3D"gmail_quote">On Thu, Dec 21, 2017 at 2:44 PM, =
Gregory Maxwell via bitcoin-dev <span dir=3D"ltr" class=3D"">&lt;<a =
href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" target=3D"_blank" =
class=3D"">bitcoin-dev@lists.linuxfoundation.org</a>&gt;</span> =
wrote:<br class=3D""><blockquote class=3D"gmail_quote" style=3D"margin:0 =
0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex">Personally, I'm =
pulling out the champaign that market behaviour is<br class=3D"">
indeed producing activity levels that can pay for security without<br =
class=3D"">
inflation, and also producing fee paying backlogs needed to stabilize<br =
class=3D"">
consensus progress as the subsidy declines.<br class=3D"">
<br class=3D"">
I'd also personally prefer to pay lower fees-- current levels even<br =
class=3D"">
challenge my old comparison with wire transfer costs-- but we should<br =
class=3D"">
look most strongly at difficult to forge market signals rather than<br =
class=3D"">
just claims-- segwit usage gives us a pretty good indicator since =
most<br class=3D"">
users would get a 50-70% fee reduction without even considering the<br =
class=3D"">
second order effects from increased capacity.<br class=3D"">
<br class=3D"">
As Jameson Lopp notes, more can be done for education though-- =
perhaps<br class=3D"">
that market signal isn't efficient yet. But we should get it there.<br =
class=3D"">
<br class=3D"">
But even independently of segwit we can also look at other =
inefficient<br class=3D"">
transaction styles: uncompressed keys, unconfirmed chaining instead =
of<br class=3D"">
send many batching, fee overpayment, etc... and the message there is<br =
class=3D"">
similar.<br class=3D"">
<br class=3D"">
I've also seen some evidence that a portion of the current high rate<br =
class=3D"">
congestion is contrived traffic. To the extent that it's true there<br =
class=3D"">
also should be some relief there soon as the funding for that runs<br =
class=3D"">
out, in addition to expected traffic patterns, difficulty changes,<br =
class=3D"">
etc.<br class=3D"">
<div class=3D"HOEnZb"><div class=3D"h5"><br class=3D"">
<br class=3D"">
On Thu, Dec 21, 2017 at 9:30 PM, Melvin Carvalho via bitcoin-dev<br =
class=3D"">
&lt;<a href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" =
class=3D"">bitcoin-dev@lists.<wbr class=3D"">linuxfoundation.org</a>&gt; =
wrote:<br class=3D"">
&gt; I asked adam back at hcpp how the block chain would be secured in =
the long<br class=3D"">
&gt; term, once the reward goes away.&nbsp; The base idea has always =
been that fees<br class=3D"">
&gt; would replace the block reward.<br class=3D"">
&gt;<br class=3D"">
&gt; At that time fees were approximately 10% of the block reward, but =
have now<br class=3D"">
&gt; reached 45%, with 50% potentially being crossed soon<br class=3D"">
&gt;<br class=3D"">
&gt; <a href=3D"https://fork.lol/reward/feepct" rel=3D"noreferrer" =
target=3D"_blank" class=3D"">https://fork.lol/reward/feepct</a><br =
class=3D"">
&gt;<br class=3D"">
&gt; While this bodes well for the long term security of the coin, I =
think there<br class=3D"">
&gt; is some legitimate concern that the fee per tx is prohibitive for =
some use<br class=3D"">
&gt; cases, at this point in the adoption curve.<br class=3D"">
&gt;<br class=3D"">
&gt; Observations of segwit adoption show around 10% at this point<br =
class=3D"">
&gt;<br class=3D"">
&gt; <a href=3D"http://segwit.party/charts/" rel=3D"noreferrer" =
target=3D"_blank" class=3D"">http://segwit.party/charts/</a><br =
class=3D"">
&gt;<br class=3D"">
&gt; Watching the mempool shows that the congestion is at a peak, though =
it's<br class=3D"">
&gt; quite possible this will come down over the long weekend.&nbsp; I =
wonder if this<br class=3D"">
&gt; is of concern to some.<br class=3D"">
&gt;<br class=3D"">
&gt; <a href=3D"https://dedi.jochen-hoenicke.de/queue/more/#24h" =
rel=3D"noreferrer" target=3D"_blank" =
class=3D"">https://dedi.jochen-hoenicke.<wbr =
class=3D"">de/queue/more/#24h</a><br class=3D"">
&gt;<br class=3D"">
&gt; I thought these data points may be of interest and are mainly =
FYI.&nbsp; Though<br class=3D"">
&gt; if further discussion is deemed appropriate, it would be =
interesting to hear<br class=3D"">
&gt; thoughts.<br class=3D"">
&gt;<br class=3D"">
</div></div><div class=3D"HOEnZb"><div class=3D"h5">&gt; =
______________________________<wbr class=3D"">_________________<br =
class=3D"">
&gt; bitcoin-dev mailing list<br class=3D"">
&gt; <a href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" =
class=3D"">bitcoin-dev@lists.<wbr class=3D"">linuxfoundation.org</a><br =
class=3D"">
&gt; <a =
href=3D"https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev" =
rel=3D"noreferrer" target=3D"_blank" =
class=3D"">https://lists.linuxfoundation.<wbr =
class=3D"">org/mailman/listinfo/bitcoin-<wbr class=3D"">dev</a><br =
class=3D"">
&gt;<br class=3D"">
______________________________<wbr class=3D"">_________________<br =
class=3D"">
bitcoin-dev mailing list<br class=3D"">
<a href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" =
class=3D"">bitcoin-dev@lists.<wbr class=3D"">linuxfoundation.org</a><br =
class=3D"">
<a href=3D"https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev"=
 rel=3D"noreferrer" target=3D"_blank" =
class=3D"">https://lists.linuxfoundation.<wbr =
class=3D"">org/mailman/listinfo/bitcoin-<wbr class=3D"">dev</a><br =
class=3D"">
</div></div></blockquote></div><br class=3D""></div>
_______________________________________________<br class=3D"">bitcoin-dev =
mailing list<br class=3D""><a =
href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" =
class=3D"">bitcoin-dev@lists.linuxfoundation.org</a><br =
class=3D"">https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev<=
br class=3D""></div></blockquote></div><br class=3D""></body></html>=

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