… I didn’t say virtual bytes. It’s a virtual block size limit or vByte it’s a unit of measurement, not fiat lol. One vByte is equal to 4 weight units.
It’s part of the functionality that ma...
Assume the fee market clears at 1 sat/byte.
Under Satoshi’s original protocol, purchasing an entire block required paying for every byte equally.
1,000,000 bytes x 1 sat/byte =
1,000,000 sats.
Every permanently stored byte imposed the same economic cost because every permanently stored byte imposed the same physical burden on the network. The economics matched the physics.
Now consider a witness-heavy SegWit block.
I can now purchase 4MB of permanent blockchain memory on your node for the same 1,000,000 sats.
The effective price becomes
1,000,000 / 4,000,000 bytes = 0.25 sats/byte
1 sat per legacy byte
0.25 sat per witness byte
Nothing changed about the physical reality of those bytes.
Every one of those four million bytes must still be:
- transmitted
- validated
- stored
- indexed
- backed up
- and preserved forever by every full node.
The blockchain does not remember which bytes were discounted. It simply remembers bytes. The physical cost of one permanently stored byte remains constant.
The economic cost no longer remains constant.
1 bit purchased ≠ 1 bit stored
This is not because the bits themselves differ, but because the protocol values identical physical memory differently. Bitcoin’s fee market exists to allocate a finite physical resource: permanent blockspace.
If two identical physical resources are assigned different prices, the market no longer discovers the true price of scarcity. Instead, it discovers the cheapest protocol-defined representation of that resource. That is exactly what witness discounting incentivizes.
If you think the spam problem should be solved by policy then why did you agree to a protocol that makes your nodes permanent memory up to four times cheaper in the first place? This is total irony.
If your concern is chain growth, node requirements, archival burden, or “spam,” then the first thing you should care about is whether the protocol is pricing the physical burden of permanent memory correctly.
The blockchain has no concept of “spam.” It has no concept of “financial transaction.” It has no concept of “witness.” It only preserves irreversible bits.
If every stored bit imposes the same perpetual burden on every future node, then every stored bit should compete under identical economic rules.
Otherwise the fee market is no longer pricing blockspace. It is pricing protocol categories. That is the fundamental distortion introduced by witness discounting. It did not simply change Bitcoin’s throughput. It changed the exchange rate between satoshis and permanent memory. Once that exchange rate ceased to be uniform, the protocol stopped conserving the original economic symmetry established by Satoshi and original consensus.
Bitcoin only works if
1 sat = 1 sat
and
1 bit = 1 bit
If either identity breaks then you have broken the fundamental pricing mechanism of the blockspace fee market where sats<>bits are exchanged between valid nonce party and transactors.
You don’t get to have your cake and eat it too, the real cost of lightning transactions are paid for by the burden of node runners. Yes we can mandate the price of cars and pretend they are cheap, but someone still has to pay the real physical cost in energy regardless.
There is no free lunch. You can’t have both. Bitcoiners can’t complain about market manipulation in fiat land when everyone running Segwit is implicit in manipulating the fee market through arbitrary discounts. We must stop double spending our principles where it’s convenient.
Under Satoshi’s original protocol, purchasing an entire block required paying for every byte equally.
1,000,000 bytes x 1 sat/byte =
1,000,000 sats.
Every permanently stored byte imposed the same economic cost because every permanently stored byte imposed the same physical burden on the network. The economics matched the physics.
Now consider a witness-heavy SegWit block.
I can now purchase 4MB of permanent blockchain memory on your node for the same 1,000,000 sats.
The effective price becomes
1,000,000 / 4,000,000 bytes = 0.25 sats/byte
1 sat per legacy byte
0.25 sat per witness byte
Nothing changed about the physical reality of those bytes.
Every one of those four million bytes must still be:
- transmitted
- validated
- stored
- indexed
- backed up
- and preserved forever by every full node.
The blockchain does not remember which bytes were discounted. It simply remembers bytes. The physical cost of one permanently stored byte remains constant.
The economic cost no longer remains constant.
1 bit purchased ≠ 1 bit stored
This is not because the bits themselves differ, but because the protocol values identical physical memory differently. Bitcoin’s fee market exists to allocate a finite physical resource: permanent blockspace.
If two identical physical resources are assigned different prices, the market no longer discovers the true price of scarcity. Instead, it discovers the cheapest protocol-defined representation of that resource. That is exactly what witness discounting incentivizes.
If you think the spam problem should be solved by policy then why did you agree to a protocol that makes your nodes permanent memory up to four times cheaper in the first place? This is total irony.
If your concern is chain growth, node requirements, archival burden, or “spam,” then the first thing you should care about is whether the protocol is pricing the physical burden of permanent memory correctly.
The blockchain has no concept of “spam.” It has no concept of “financial transaction.” It has no concept of “witness.” It only preserves irreversible bits.
If every stored bit imposes the same perpetual burden on every future node, then every stored bit should compete under identical economic rules.
Otherwise the fee market is no longer pricing blockspace. It is pricing protocol categories. That is the fundamental distortion introduced by witness discounting. It did not simply change Bitcoin’s throughput. It changed the exchange rate between satoshis and permanent memory. Once that exchange rate ceased to be uniform, the protocol stopped conserving the original economic symmetry established by Satoshi and original consensus.
Bitcoin only works if
1 sat = 1 sat
and
1 bit = 1 bit
If either identity breaks then you have broken the fundamental pricing mechanism of the blockspace fee market where sats<>bits are exchanged between valid nonce party and transactors.
You don’t get to have your cake and eat it too, the real cost of lightning transactions are paid for by the burden of node runners. Yes we can mandate the price of cars and pretend they are cheap, but someone still has to pay the real physical cost in energy regardless.
There is no free lunch. You can’t have both. Bitcoiners can’t complain about market manipulation in fiat land when everyone running Segwit is implicit in manipulating the fee market through arbitrary discounts. We must stop double spending our principles where it’s convenient.
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