Rebuttal of Mike Hearn's Bitcoin Transaction Capacity Problem — Why We Can't Use Fancy Tricks to Avoid It

After reading an article by Mike Hearn titled "Bitcoin's Transaction Capacity Problem - Why We Can't Use Fancy Techniques to Avoid It", I was filled with anger. I wondered how many people this article would mislead. So I quickly wrote this article to refute Mike Hearn. First, I learned about the author through "Bitcoin Will Not Fail, Mike Hearn Will Fail". He is the "famous" developer who launched Bitcoin XT and threatened that Bitcoin would fail after XT failed.

1. Background

First of all, we should know that the 1MB limit was added by Satoshi Nakamoto. In addition, regarding the view of whether it will be in the future, the response given by the community at that time was:

For details, please see the post "[Satoshi Nakamoto's View] Speech on the Block Size in 2010", which clearly pointed out at the beginning that the block file should be kept as small as possible. As for "As long as the SPV wallet is developed, Satoshi Nakamoto plans to eliminate it." It should be Mike Hearn's own imagination. Satoshi Nakamoto did not say this explicitly, but only said that in the ultimate solution, it is not necessary to care about how big it becomes. But two questions: one is that we have reached the "ultimate eventual" now? The other is that does not need to "care" about how big it is mean to remove the restrictions?

Mike Hearn thinks that the emergence of SPV wallets is the ultimate solution, which is ridiculous. On the contrary, I think that when the real "Lightning Network" (not the Stroem protocol he mentioned) is running, it will be the ultimate solution. At that time, there is no need to worry about the block size. The "no concern" here does not mean to relax the restrictions, but that 1MB is enough under the Lightning Network.

2. Is capacity expansion the job of capacity planners?

Mike Hearn said that he is a professional capacity planner at Google, and he knows how many servers Google has. If Bitcoin runs on Google servers, there is no need for any restrictions at all. However, is Bitcoin expansion just a capacity issue? No, one is the decentralization of nodes, and the other is the possible hard fork problem.

If we only consider the servers of large companies as Bitcoin nodes, and all other individual users use SPV wallets, then of course there is no need to limit the block size, but that will be accompanied by a trend of node centralization. As the cost of individual core wallet nodes increases with the size of blocks, gradually no one will run nodes anymore. At that time, it is entirely possible that hackers or organizations can control all nodes through various means, either overt or covert, and then Bitcoin will become centralized. This kind of node centralization is not like the centralization of computing power, which is the lowest level of centralization that cannot be restricted. The only thing that can be done is to limit the block size, reduce the cost of individual node operation, and avoid node centralization.

It is possible that node centralization is a gradual process, and this problem is not very prominent, especially when more and more tycoons are willing to run nodes. However, there is another more important problem. Direct expansion is a hard fork. If there is not enough consensus, it will cause the blockchain to fork into two chains, forming two chain coins, and eventually two main coins may coexist, just like the current ETH and ETC. Although we can think of many ways to avoid the split of the currency circle caused by hard forks, the effect is unknown. It can avoid existing fork problems, but it cannot guarantee that new problems will not arise.

Capacity expansion involves many issues, which cannot be comprehensively planned by just one capacity planner.

3. Similarities and Differences between Lightning Network and StrawPay

The Sroem protocol designed by StrawPay "defines wallets, hubs and traders, and sets up payment channels between them". In fact, to put it bluntly, it is just a third-party payment wallet. By packaging and adding some concepts, it actually fooled Mike Hearn into thinking that it was similar to the Lightning Network with only some different technical details, which shows its level.

For small amount payments, there have been off-chain "third-party payment" solutions for a long time. StrawPay's solution is just a third-party payment. The biggest problem with third-party payment is not its performance, but its centralization.

The emergence of the Lightning Network is not to solve the problem of slow transactions, but to solve the problem of decentralization. It turns the fast off-chain payment channel that should have relied on a third party for confirmation into a coded one that can be confirmed on the blockchain itself.

Let me give you an example. In StrawPay, two parties, A and B, each give him 1 BTC for safekeeping, and then a redistribution is confirmed off-chain between the two parties. In the Lightning Network, two parties, A and B, each send 1 BTC to build a lightning transaction, form a channel, and then the transaction is confirmed off-chain through a signature recognized by both parties.

The Lightning Network, like the Bitcoin network and the Internet, is a technology that does not belong to any company, but can be used by any company. Your company can develop into a Lightning node, but it does not mean that it is your company's Lightning Network.

4. Will Lightning Network Become a Threshold?

The main point of Mike Hearn's full article is that "the Lightning Network is too complicated and will eliminate novices."

First of all, it should be noted that the "Lightning Network" is not a technology that users are forced to use. After the core operating network of the "Lightning Network" is built, you can completely ignore it and continue to use the old version of bitcoinj that does not support lightning to conduct transactions on the traditional main chain. It is compatible. Various Bitcoin wallets can support the Lightning Network or not. It does not mean that newcomers must learn the Lightning Network before entering the Bitcoin world. In addition, the "Lightning Network" is not a wallet, but a technology that can be integrated into wallets, and will not affect the decentralization of the wallet market.

The Lightning Network is actually not complicated. Many people just don't understand it and mistakenly think it is complicated. In fact, if you do a good job of popularizing the currency, it is not complicated at all. Follow the "Bite Jiang" public account, there is an article "6.9 Bite Jiang - Lightning Network Plain Language Zero Threshold Explanation", which introduces several levels of the Lightning Network in a popular way. The first layer is to redistribute frozen coins off-chain. The second layer is similar to the password red envelope based on the first layer. Getting the password is similar to getting the currency distribution. The third layer is based on the second layer, forming a payment network chain to realize the payment between two strangers.

Even if the Lightning Network seems complicated to some people, just like we don’t need to understand TCP/IP when surfing the Internet, users who use the Lightning Network don’t need to understand how the Lightning Network works behind the scenes. They only need to use the wallet version that supports the Lightning Network, but these are backend supports and there is no difference in the user interface. The only difference is that it took a long time to receive confirmation after sending and receiving coins, but after checking the option to use the Lightning Network, confirmation can be received almost in seconds. For "novice" users, they don't need to build the Lightning Network themselves, so there is no threshold.

Finally, regarding the issue of security, in fact, "when one party loses data, the other party may steal funds", as well as various possible hacker attacks, there is no need to worry too much, attack and defense are interdependent, and problems will be fixed in the future. There is no absolute security, just like there is no absolutely safe third party. Just put less coins on Lightning, and of course large-value storage coins are still cold stored on the main chain. Welcome to the "Bite Sauce" WeChat public account to communicate.