Op Ed: How the Market Is Deciding the Block Size Debate … and the Marketing Lesson for Us All

The battle over block size has consumed the Bitcoin community for a while now. At the core, the question comes down to this: Is Bitcoin a “store of value” (i.e., digital gold) or a “currency” (i.e., digital cash)? That determination informs the decision about bigger blocks vs. smaller blocks.  

Bigger blocks contain more data, which yields smaller transaction fees and thus are more conducive to small payments, thus facilitating the use of Bitcoin as cash, relevant for any payments.

On the other hand, smaller blocks have less data contained within them, so space is at a premium and you pay a higher transaction fee to be included. As a result, it starts to make sense only for much larger transaction sizes. The bottom line is if you are transferring $10,000 worth of value, you’re fine with a $1.50 fee, but the same fee added onto a $3 cup of coffee seems a bit crazy.

If you are of the opinion that Bitcoin’s value rests primarily in its usefulness as an everyday currency — or digital cash — then you probably want a system that will have the lowest possible fees to move your funds around.

If you are of the opinion

Read more ... source: Bitcoin Magazine

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