Hi Team, I would like to find out what the current consensus on transaction tiering is.
Background: The current protocol enables two parties to transact freely, however, transaction processors (block generators) have the authority to discriminate participants arbitrarily. This is well known and it is widely accepted that transaction processors may take advantage of this with little recourse. It is the current consensus that the economic incentives in form of transaction fees are sufficient because the transaction processing authorities are assumed to be guided by the growth of Bitcoin and the pursuit of profit. We can establish that a transaction processing authority does not need to actually process transactions and reigns sovereign over the block space they govern. [1] For further discussion I will refer to a transaction processor more aptly as "Block Space Authority" (BSA). Currently, a user can only signal to all BSA’s (via the mempool) its desire to include her transaction into the ledger. A user can not signal to specific BSA’s, and thus, can not easily carry out business in jurisdictions that conform to the users understanding of best practice. As a participant in the economy in general and of Bitcoin in particular, I desire an ability to decide where I transact. The current state of Bitcoin does not allow me to choose my place of business. As a consequence, I try to learn what would be the best way to conduct my business in good faith. [2] I have certain minimum requirements towards the constitution of the block space like transparency, forward guidance and risk management. More poignantly, it could also include due diligence to ensure that child labor is not involved in the maintenance of a specific block space, or that the specific block space does not utilize nuclear energy or sources at least 80% of the expended energy from solar power. Obviously, preferences can vary widely. I don’t think there is any way to discard the desire of users to choose their place of business, especially under the consideration that BSA’s have the discretion to choose users transactions already. I have identified the following options along the lines of Lawrence Lessig's concept of Cyberspace: [3] 1. Law: Bilateral Agreement Users engage directly with BSA’s to process their transaction. Transactions are routed around the mempool. A likely outcome of this solution is the emergence of brokers that sell off block space in a sort of secondary market. Wallets may negotiate on behalf of their users. This model has obvious downsides as it involves new middlemen, increases transaction cost beyond the current market price (speculation) and potentially reduces performance. 2. Architecture: Remove transaction fees If only the block reward functions to incentivise transaction processing, no differentiation is useful. However, spam/empty blocks could not be prevented and Bitcoin would have to be entirely redesigned, potentially losing its censorship resistance. 3. Market: Direct Communication Through the core client, BSA’s can offer individual mempools that users can choose to advertise their transactions to. Different BSA’s could receive different transaction fees for the same transaction in their respective mempool to reflect the preference of the user. In Conclusion: In the long term, it is likely that a clearer differentiation of BSA’s will become important. Today, BSA’s communicate rarely and it appears that their raison d'etre is not necessarily motivated by good faith towards Bitcoin as a whole. [4] As we move forward it is not just important to attract opportunistic players that win an individual game but good players that are invited to play again in order to win a set of all possible games. BSA’s establish their authority on cheap access to capital in the form of electricity and hardware and the consent and trust of users who expect BSA's to respect and maintain the ledgers integrity. In 3 to 8 years, when Bitcoin leaves it’s bootstrapping phase, the incentives will squarely fall on the later. [5] Subsequently it seems prudent to allow BSA’s to compete for business on other factors than price. Hence my question: What is the current stance of core developers regarding the facilitation of direct communication between users and BSA’s, possibly through a transaction tiering model? Sincerely, Martin Stolze [1] BSA rules sovereign: (https://twitter.com/JihanWu/status/704476839566135298) [2] No direct attribution but solid foundation for business logic since 1899: §242 ff BGB (https://www.gesetze-im-internet.de/englisch_bgb/englisch_bgb.html#p0726) [3] Lessig, Code. "And Other Laws of Cyberspace, Version 2.0." (2006). [4] The pursuit of profit can come at the expense of Bitcoin: (https://twitter.com/ToneVays/status/835233366203072513) [5] Satoshi Nakamoto: "Once a predetermined number of coins have entered circulation, the incentive can transition entirely to transaction fees [...]" _______________________________________________ bitcoin-dev mailing list bitcoin-dev@lists.linuxfoundation.org https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev
