 What are your thoughts on? Very block being responsible for almost one quarter of Bitcoin transactions in January by using the up return script for proof of proof This is a question by Jonathan I'm not familiar with the case of very block, but nevertheless Let's let's assume that that's an accurate representation and very block is indeed using one quarter of all Bitcoin transactions in January Jonathan asks could this and other such uses of the Bitcoin blockchain have an impact on the fee market such as it affects the use of Bitcoin as money. This is a great question because this thing comes up a lot What is a valid transaction? What is a spam transaction on the Bitcoin system and the answer is really simple We have two ways of determining whether a transaction should and should not be on the Bitcoin system One possible way to do that is to set rules in the protocol that make a difference between What is spam and what is not spam? basically allow the developers of the Bitcoin core protocol to pick and Choose winners and losers by determining which applications should innovate and which should not based on some determination qualitative normative judgment of What is a valid use case of Bitcoin and what is not and you might think that that's an easy answer Money is the right thing. Everything else is superfluous extraneous not really relevant But then again, which applications of money is is multi-stake money enough or is that fancy scripting and programming? What about lightning network should that be allowed maybe some of the original core developers are not so fun not so interested in Lightning, what about time locks and other things like that? What about other forms of smart contracts? This is a very slippery slope. So in in Bitcoin today We use a market-based mechanism and the market-based mechanism is really simple The fee market enables pricing of transactions based on supply and demand that allows the market and Especially the sender of a transaction to signal to the network through their selection of fees What importance that transaction has to them? How important that transaction is to them and thereby pricing the cost of Transactions space across the entire market vis-a-vis other applications that might not be as important and what this is? Pricing is not just whether the transaction is Confirmed or not, but more importantly how fast the transaction is confirmed in this particular case The market is pricing very blocks transactions Which are using one quarter of the Bitcoin blockchain for proof-of-proof and Apparently that's how much of the capacity the market is pricing to allocate in that particular application Does it affect the use of Bitcoin as money? It certainly prices that scarce resource and what it does is This fee market prevents people from attacking the network with denial of service attacks and spam attacks because it causes A cost because it makes it costly to post transactions that are not important to the sender So spam is expensive on Bitcoin because of transaction fees and that prevents attacks against the network I haven't had any difficulty making my transactions I haven't had any difficulty making them on the Bitcoin blockchain with Segwit I haven't had any difficulty making them on lightning and opening and closing channels I always use the absolute minimum fee possible what Satoshi provides I Use replaced by fee transactions just in case I want to bump the fee later because it's not going through but honestly I haven't bumped a fee in six months or more and The transactions I make which I make very regularly on a weekly basis get through within the first or second block so is this a problem for the Bitcoin network no it isn't and There's nothing wrong with using one quarter of all Bitcoin transactions as long as you pay for them The the issue here is that we need to understand that in the absence of a fee market What is the alternative in the absence of a market-based solution to? prioritization and capacity management Resource allocation within the Bitcoin blockchain we can do one of two things one we can assume that resources are infinite or near infinite and that Just giving free transactions to everyone will not have any economic impact What that will do effect is effectively is it will subsidize those who are sending transactions and It will subsidize miners through other means probably inflation and cause further Centralization of nodes and more importantly mining to fewer and fewer hands So there is a cost instead of paying that cost in fees to maintain Decentralization you pay that cost by losing Decentralization behind the scenes in a subtle long-term way that is less easy to detect that is a very dangerous path And we've seen other blockchains try that so it's okay If you want to try that method you can always choose one of the other blockchains that does it that way The other option is to substitute market forces with centralized control and decision-making by committee to give developers the power to choose what is and isn't a valid transaction Both of those choices are inferior to market forces So I don't think there's anything wrong with anyone using whatever capacity of the Bitcoin blockchain They want to for whatever application they want to as long as they're willing to pay the fee and compete in the market