Bitcoin would be better money than current money even if it were a bit more expensive to transact, simply because of its other great characteristics (trustlessness, limited supply, etc). However... it is not better than something else sharing all those same characteristics but which is also less expensive. The best money will win, and if Bitcoin doesn't increase capacity then it won't remain the best.

On Tue, Aug 11, 2015 at 4:23 PM, Adam Back <adam@cypherspace.org> wrote:
I dont think Bitcoin being cheaper is the main characteristic of
Bitcoin.  I think the interesting thing is trustlessness - being able
to transact without relying on third parties.

Adam


On 11 August 2015 at 22:18, Michael Naber via bitcoin-dev
<bitcoin-dev@lists.linuxfoundation.org> wrote:
> The only reason why Bitcoin has grown the way it has, and in fact the only
> reason why we're all even here on this mailing list talking about this, is
> because Bitcoin is growing, since it's "better money than other money". One
> of the key characteristics toward that is Bitcoin being inexpensive to
> transact. If that characteristic is no longer true, then Bitcoin isn't going
> to grow, and in fact Bitcoin itself will be replaced by better money that is
> less expensive to transfer.
>
> So the importance of this issue cannot be overstated -- it's compete or die
> for Bitcoin -- because people want to transact with global consensus at high
> volume, and because technology exists to service that want, then it's going
> to be met. This is basic rules of demand and supply. I don't necessarily
> disagree with your position on only wanting to support uncontroversial
> commits, but I think it's important to get consensus on the criticality of
> the block size issue: do you agree, disagree, or not take a side, and why?
>
>
> On Tue, Aug 11, 2015 at 2:51 PM, Pieter Wuille <pieter.wuille@gmail.com>
> wrote:
>>
>> On Tue, Aug 11, 2015 at 9:37 PM, Michael Naber via bitcoin-dev
>> <bitcoin-dev@lists.linuxfoundation.org> wrote:
>>>
>>> Hitting the limit in and of itself is not necessarily a bad thing. The
>>> question at hand is whether we should constrain that limit below what
>>> technology is capable of delivering. I'm arguing that not only we should
>>> not, but that we could not even if we wanted to, since competition will
>>> deliver capacity for global consensus whether it's in Bitcoin or in some
>>> other product / fork.
>>
>>
>> The question is not what the technology can deliver. The question is what
>> price we're willing to pay for that. It is not a boolean "at this size,
>> things break, and below it, they work". A small constant factor increase
>> will unlikely break anything in the short term, but it will come with higher
>> centralization pressure of various forms. There is discussion about whether
>> these centralization pressures are significant, but citing that it's
>> artificially constrained under the limit is IMHO a misrepresentation. It is
>> constrained to aim for a certain balance between utility and risk, and
>> neither extreme is interesting, while possibly still "working".
>>
>> Consensus rules are what keeps the system together. You can't simply
>> switch to new rules on your own, because the rest of the system will end up
>> ignoring you. These rules are there for a reason. You and I may agree about
>> whether the 21M limit is necessary, and disagree about whether we need a
>> block size limit, but we should be extremely careful with change. My
>> position as Bitcoin Core developer is that we should merge consensus changes
>> only when they are uncontroversial. Even when you believe a more invasive
>> change is worth it, others may disagree, and the risk from disagreement is
>> likely larger than the effect of a small block size increase by itself: the
>> risk that suddenly every transaction can be spent twice (once on each side
>> of the fork), the very thing that the block chain was designed to prevent.
>>
>> My personal opinion is that we should aim to do a block size increase for
>> the right reasons. I don't think fear of rising fees or unreliability should
>> be an issue: if fees are being paid, it means someone is willing to pay
>> them. If people are doing transactions despite being unreliable, there must
>> be a use for them. That may mean that some use cases don't fit anymore, but
>> that is already the case.
>>
>> --
>> Pieter
>>
>
>
> _______________________________________________
> bitcoin-dev mailing list
> bitcoin-dev@lists.linuxfoundation.org
> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev
>