[Bitcoin-development] replace-by-fee v0.10.0rc4

Mike Hearn mike at plan99.net
Thu Feb 12 11:58:16 UTC 2015

I know you will ignore this as usual, but the entire replace-by-fee folly
is based on your fundamental misunderstanding of miner incentives.

Miners are *not* incentivised to earn the most money in the next block
possible. They are incentivised to maximise their return on investment.
Making Bitcoin much less useful reduces demand for the bitcoins they are
mining, reducing coinbase and fee income in future blocks. Quite possibly,
to the point where those miners are then making a loss.

Your "scorched earth" plan is aptly named, as it's guaranteed to make
unconfirmed payments useless. If enough miners do it they will simply break
Bitcoin to the point where it's no longer an interesting payments system
for lots of people. Then miners who have equipment to pay off will be
*really* screwed, not to mention payment processors and all the investors
in them.

I'm sure you can confuse a few miners into thinking your ideas are a
super-duper way to maximise their income, and in the process might
facilitate a pile of payment fraud. But they aren't. This one is about as
sensible as your "let's never increase the block size"  and "let's kill SPV
clients" crusades - badly thought out and bad for Bitcoin.
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