Recently, I finished reading (or rather, listening to) two major historical books about the great Bitcoin block size war of the 2010s. These books represent opposing viewpoints: Jonathan Bier’s “The Blocksize War” tells the story from the perspective of the small block camp, while Roger Ver and Steve Patterson’s “Hijacking Bitcoin” tells the story from the perspective of the big block camp.
Reading these historical books about events I personally experienced and to some extent participated in was fascinating. While I was familiar with most of the events and narratives surrounding the conflict, there were still some interesting details I didn’t know or had completely forgotten, and it was intriguing to see these situations with fresh eyes. At the time, I was a “supporter of big blocks,” but I was a pragmatic moderate, opposing extreme growth or absolute statements that fees should never significantly increase. So do I still support the views I held back then? I look forward to seeing and finding out the answer.
In Bier’s narrative, how do the small block camp view the block size war?
The initial debate of the block size war revolved around a simple question: should Bitcoin increase the block size limit from the then 1 MB through a hard fork to allow for more transactions, thereby reducing fees, but at the cost of making running and validating nodes on the blockchain network more difficult and expensive?
“[If the block size is much larger], you need a large data center to run a node, and you won’t be able to run it anonymously.” – This is a key argument put forth in a video sponsored by Peter Todd, advocating for keeping the block size small.
Bier’s book gives the impression that while the small block camp did indeed care about this specific issue, they tended to be conservative and only wanted a slight increase in block size to ensure that running nodes remained easy. However, they were more concerned about how protocol-level decisions determined this higher-level issue. In their view, protocol changes (especially “hard forks”) should be extremely rare and require a high level of consensus among protocol users.
Bitcoin is not trying to compete with payment processors – there are already plenty of those. Instead, Bitcoin is trying to be something more unique and special: a completely new form of currency, free from control by central organizations and central banks. If Bitcoin were to have a highly active governance structure (which is necessary for controversial adjustments to block size parameters), or become easy to be coordinated and manipulated by miners, exchanges, or other large companies, it would forever lose this precious unique advantage.
In Bier’s narrative, what causes the most discomfort for the small block camp regarding the big block camp is their frequent attempts to gather a relatively small number of big players together to legitimize and push for changes that align with their preferences – which is completely opposite to the small block camp’s view on how governance should be conducted.
“The New York Agreement” signed by major Bitcoin exchanges, payment processors, miners, and other companies in 2017 is seen by the small block camp as a key example of an attempt to transition Bitcoin from being user-driven to being controlled by a consortium of corporations.
In Ver’s narrative, how does the big block camp view the block size war?
The big block camp typically focuses on one key specific issue: what should Bitcoin be? Should it be a store of value – digital gold, or a medium of exchange – digital cash? For them, it has been clear from the beginning that the original vision and the vision that all big block supporters identify with is digital cash. This is even explicitly mentioned in the whitepaper!
The big block camp also frequently references two other works by Satoshi Nakamoto:
1. The Simplified Payment Verification section in the whitepaper, which discusses how individual users can use Merkle proofs to verify their payments are included without having to validate the entire chain when blocks become very large.
2. A quote from Bitcointalk advocating for gradually increasing the block size through hard forks:
For them, the shift from focusing on digital cash to digital gold is a deviation that was agreed upon by a small and tightly-knit core developer group, and then they believe that because they have had internal discussions and come to a conclusion, they have the right to impose their views on the entire project.
The small block camp does propose that Bitcoin can be a solution for both cash and gold – that is, Bitcoin becomes the “first layer” focused on being gold, while second-layer protocols built on top of Bitcoin, such as the Lightning Network, provide cheap payments without the need for every transaction to be on the blockchain. However, these solutions are highly inadequate in practice, and Ver spends several chapters thoroughly criticizing them. For example, even if everyone switches to the Lightning Network, eventually an increase in block size would still be necessary to accommodate hundreds of millions of users. Additionally, receiving coins on the Lightning Network without trust requires an online node, and in order to ensure your coins are not stolen, you need to check the chain once a week. These complexities, Ver believes, will inevitably push users to interact with the Lightning Network in a centralized way.
What are the key differences in their viewpoints?
Ver’s description of the specific debates aligns with the small block camp: both sides agree that the small block camp places a higher emphasis on the ease of running nodes, while the big block camp places a higher emphasis on low transaction fees. They both acknowledge that differences in beliefs are a key factor contributing to the debates.
However, Bier and Ver have starkly different descriptions of most of the deeper issues. For Bier, the small block camp represents the users, opposing a small but powerful group of miners and exchanges attempting to control the blockchain network for their own interests. The small block camp keeps Bitcoin decentralized by ensuring that regular users can run nodes and validate the blockchain network. For Ver, the big block camp represents the users, opposing a small self-appointed clergy and venture capital-backed companies (i.e., Blockstream) that profit from the second-layer solutions necessary for the small block roadmap. The big block camp keeps Bitcoin decentralized by ensuring that users can continue to afford on-chain transaction fees without relying on centralized second-layer infrastructure.
The closest they come to “agreement on the terms of the debate” is Bier’s book acknowledging that many in the big block camp have good intentions and even recognizing the reasonable dissatisfaction with forum moderators censoring opposing opinions, but frequently criticizing the incompetence of the big block camp, while Ver’s book tends to attribute malicious intent or even conspiracy theories to the small block camp but rarely criticizes their capability. This reflects a common political metaphor I have heard on many occasions – “the right thinks the left is naive, while the left thinks the right is evil.”
How do I view the block size war? How do I view it now?
Room 77, a restaurant in Berlin that used to accept Bitcoin payments, was the center of the Bitcoin community, with many restaurants accepting Bitcoin. Unfortunately, the dream of Bitcoin payments faded in the latter half of the decade, and I believe constantly rising fees were a key reason.
When I personally experienced the Bitcoin block size war, I generally aligned with the big block camp. My support for the big block camp was centered around a few key points:
– One key intention of Bitcoin is digital cash, and high fees could kill this use case. While second-layer protocols theoretically offer lower fees, the entire concept has not been thoroughly tested, and it is highly irresponsible for the small block camp to stick to the small block roadmap without much knowledge of the practical effects of the Lightning Network. Today, pessimistic views on the actual usage of the Lightning Network are becoming more widespread.
– I am not convinced by the small block camp’s “meta-level” argument. The small block camp often claims that “Bitcoin should be controlled by users” and “users don’t support big blocks,” but they have never been willing to clearly define who the “users” are or how to measure user preferences. The big block camp implicitly suggests at least three different ways of calculating users: hash power, public statements from prominent companies, and social media discussions, all of which the small block camp denies. The big block camp organized the New York Agreement not because they love “cartels” but because they believe signing statements from major stakeholders is the only practical way to achieve consensus among “users” for any controversial changes.
– Segregated Witness, the slightly increased block size proposal adopted by the small block camp, is unnecessarily complex compared to a simple hard fork increase in block size. The small block camp eventually formed the creed of “soft fork good, hard fork bad” (which I strongly disagree with) and designed their block size increase proposal to fit this rule, even though Bier admits it brought severe complexity to the point that many in the big block camp couldn’t understand the proposal. I feel the small block camp is not just “cautious,” they are arbitrarily choosing between different types of caution, choosing one (no hard fork) at the expense of the other (maintaining clean code and specifications) because it aligns with their agenda. In the end, the big block camp also gave up on “clean code and specifications” and turned to the idea of adaptive block size increases, such as Bitcoin Unlimited, which Bier harshly criticizes (rightfully so).
– The small block camp has indeed engaged in very uncool social media censorship to impose their views, ultimately leading to Theymos’ infamous statement: “If 90% of /r/Bitcoin users find these policies intolerable, I hope that they leave /r/Bitcoin.” PS: “/r/” represents subreddits on Reddit.
Even relatively mild posts supporting big blocks were often deleted. Custom CSS was used to make these deleted posts invisible.
Ver’s book focuses on the first and fourth points, as well as a portion of the third point, while also presenting theories of inappropriate behavior related to financial motives – that the small block camp established a company called Blockstream that would build second-layer protocols on top of Bitcoin and simultaneously advocated for the restricted nature of the first layer, making these commercial second-layer networks necessary. Ver is not as concerned with the philosophical question of how Bitcoin should be governed because, for him, the answer of “Bitcoin is governed by miners” is satisfactory. This is something I disagree with both the small block camp and the big block camp on – I believe that both the vague “we reject actual definitions of user consensus” and the extreme “miners should control everything because they have aligned incentives” are unreasonable.
At the same time, I remember being extremely disappointed with the big block camp on certain key points, which Bier’s book also resonates with. The worst point (which both I and Bier find) is that the big block camp never agreed to any principled limit on block size. A common view is that “block size should be determined by the market” – meaning miners should decide block size based on their own will, and other miners can choose to accept or reject those blocks. I strongly disagree with this and point out that such a mechanism is an extreme distortion of the concept of the “market.” In the end, when the big block camp split off into their own separate chain (Bitcoin Cash), it became clear that their idea of a “market” was just a euphemism for “rule by big miners.” This also aligns with Bier’s observation that the big block camp’s vision of governance was not about governance at all – it was about power.
Overall, I see the block size war as a clash between different visions and philosophies about what Bitcoin should be. It was a complex and messy conflict, with both sides having valid arguments and concerns. As for my current view, I believe that finding the right balance between scalability and decentralization is crucial for the long-term success of any blockchain project. It requires careful consideration of technical, economic, and social factors, and an openness to experiment and adapt based on real-world experience. Ultimately, the block size war was an important chapter in Bitcoin’s history, highlighting the challenges and trade-offs inherent in navigating the path to mass adoption and global scalability.In the past, there was a debate about the block size limit in Bitcoin, but eventually, they settled on a 32MB limit. I had a principled approach to determining the block size limit, which I mentioned in a post from 2018. I believed that Bitcoin should prioritize the predictability of the cost of reading the blockchain while minimizing the cost of writing to it. Ethereum, on the other hand, struck a middle ground between these two metrics. In 2022, I reiterated this view in a tweet. The philosophy behind it was to strike a balance between increasing the cost of writing to the chain (transaction fees) and the cost of reading the chain (software requirements for nodes). Ideally, if the demand for using blockchain increased by 100 times, the pain should be shared equally by increasing the block size and fees by 10 times each (as the demand elasticity for transaction fees is close to 1).
In practice, Ethereum did adopt a moderate approach to block size. Since its launch in 2015, the chain’s capacity has increased by about 5.3 times (possibly 7 times if we include calldata repricing and blob), while fees have increased from almost nothing to a significant but not excessively high level. However, this compromise-oriented approach was never fully accepted by either side. The big blockers felt it was too centralized, while the small blockers felt it was too ambiguous. I believe that the big blockers were more at fault than the small blockers. The small blockers were initially willing to moderately increase the block size (e.g., Adam Back’s 2/4/8 plan), while the big blockers were unwilling to compromise and quickly shifted from advocating for a specific large block size to a general philosophy that almost any non-trivial limit on block size was illegitimate.
The big blockers also started advocating for miners to have control over Bitcoin. Bier effectively criticized this philosophy, pointing out that if miners tried to modify the protocol rules to do things other than increasing the block size, such as giving themselves more rewards, they would quickly abandon their own views. One of Bier’s main criticisms of the big blockers was their repeated incompetence. Bitcoin Classic was poorly written, Bitcoin Unlimited was unnecessarily complex, and for a long time, they did not include wipeout protection, which greatly weakened their chances of success. They loudly called for multiple Bitcoin software implementations, a principle I agree with and one that Ethereum has also adopted. However, their “alternative clients” were essentially forks of Bitcoin Core with a few lines of code changed to implement block size increases. According to Bier, their repeated mistakes in both code and economics over time led to more and more supporters leaving. The major supporters of the big blockers believed in Craig Wright’s false claim to be Satoshi Nakamoto, which further undermined their credibility.
Craig Wright, a fraud who impersonated Satoshi Nakamoto. He frequently uses legal threats to remove criticism, which is why MyFork is the largest online repository in the Cult of Craig, documenting evidence of his fraud. Unfortunately, many big blockers fell for Craig’s deception because he catered to their views and said what they wanted to hear.
Overall, after reading these two books, I found myself more often agreeing with Ver’s views on macro issues but more often agreeing with Bier’s views on specific details. In my view, the big blockers were right on the central issue that blocks needed to be larger, preferably achieved through a simple and clean hard fork as described by Satoshi Nakamoto. However, the small blockers made fewer embarrassing mistakes in terms of technology, and their stance led to fewer instances of absurd results.
The block size debate is a one-sided power trap. Reading these two books gave me the overall impression of a political tragedy, which I believe is common in various contexts, including cryptocurrencies, companies, and national politics. One side monopolizes all the capable people but pushes narrow and biased views with their power, while the other side correctly recognizes the problem but gets immersed in opposing them and fails to cultivate the technical capabilities needed to execute their own plans. In many such cases, the first group is criticized as being dictatorial, but when you ask their (often many) supporters why they support them, their answer is that the other side would just complain and would completely fail if they were in power for even a few days. To some extent, this is not the fault of the opposition: it’s hard to become competent at execution without a platform to execute on and accumulate experience. But in the block size debate, it was particularly evident that the big blockers seemed completely unaware of the need for execution capabilities – they thought they could win simply by being right on the block size issue. The big blockers ultimately paid a heavy price for their focus on opposition rather than construction: even when they forked into their own chain (Bitcoin Cash), they had multiple splits in a short period of time until the community eventually stabilized. I call this problem a one-sided power trap. It seems to be a fundamental problem faced by anyone trying to build a political entity, project, or community that they hope to be democratic or diverse. Smart people want to work with other smart people. If two different groups are roughly evenly matched, people tend to choose the side that aligns more with their values, and this balance can be stable. But if this tendency becomes too one-sided, it enters a different equilibrium and seems difficult to recover from. To some extent, the opposition mitigates the one-sided power trap by recognizing the problem’s existence and consciously cultivating the capability to counterbalance it. Often, the opposition movement doesn’t even reach that step. But sometimes, just recognizing the problem is not enough. We would greatly benefit if there were more powerful and profound ways to prevent and escape one-sided power traps.
Less Conflict, More Technology
While reading these two books, one glaring omission stood out more than anything else: the word “ZK-SNARK” did not appear at all. There is almost no excuse for this, as by the mid-2010s, the potential of ZK-SNARKs in scalability (and privacy) was well-known. Zcash was launched in October 2016. Gregory Maxwell briefly discussed the scalability impact of ZK-SNARKs in 2013, but they seemed to be completely absent from the discussion of Bitcoin’s future roadmap.
The ultimate way to alleviate political tensions is not through compromise but through new technology: discovering entirely new approaches that bring more of what both sides want. We have seen several instances of this in Ethereum. A few examples that come to mind are:
– Justin Drake’s push for adopting BLS aggregation, which allows Ethereum’s proof-of-stake to handle more validators and reduce the minimum stake from 1500 to 32, with almost no downsides. Recent progress in signature aggregation work holds promise for further advancing this.
– EIP-7702 achieved the goals of ERC-3074 in a way that is significantly more compatible with smart contract wallets, helping to mitigate a long-standing controversy.
– Multi-dimensional gas, starting with its implementation on blob, has helped increase Ethereum’s capacity to accommodate rollup data without increasing block size in worst-case scenarios, minimizing security risks.
When an ecosystem stops embracing new technology, it inevitably stagnates and becomes more contentious: the political debate about “I get 10 more apples” versus “You get 10 more apples” is inherently less divisive than the debate about “I give up 10 apples” versus “You give up 10 apples”. The pain caused by losses is greater, and people are more willing to break their common political rules to avoid them. This is why I am deeply concerned about the narrative of stagnation and “we can’t solve social problems with technology” – there are ample reasons to believe that fighting over who gets more, rather than who loses less, is actually more conducive to social harmony.
In economic theory, there is no distinction between the two prisoner’s dilemmas: the game on the right can be seen as the game on the left plus an independent (unrelated) step where players lose a quarter regardless of their actions. But in human psychology, these two games can be very different. One of the key questions for Bitcoin’s future is whether it can be a technologically forward-looking ecosystem. The development of Inscriptions and later BitVM created new possibilities for second-layer solutions, improving what Lightning can do. Udi Wertheimer’s hopeful theory that an ETF for ETH means the end of Saylorism and a recognition that Bitcoin needs technical improvements is something I share.
Why do I care about this issue? I analyze the success and failure of Bitcoin not to denigrate Bitcoin and promote Ethereum. In fact, as someone who enjoys understanding social and political issues, I find it fascinating that Bitcoin has enough sociological complexity to generate such rich and interesting internal debates and divisions that two whole books can be written about them. Instead, I care about analyzing these issues because Ethereum and other digital (and even physical) communities I care about can learn a lot from understanding what happened, what was done well, and what could have been done better.
Ethereum’s focus on client diversity stems from observing the failure of Bitcoin with only one client team. Their versions of second-layer solutions were born out of an understanding of the limitations of Bitcoin and its second layer in terms of the trust attributes they can achieve. More broadly, Ethereum explicitly attempts to cultivate a diverse ecosystem to avoid the one-sided power trap.
Another example that comes to mind is the concept of “network states.” Network states are a new digital separatist strategy that allows communities with shared values to break free from the constraints of mainstream society and build their vision for the cultural and technological future. However, the experience of Bitcoin Cash (post-fork) suggests that movements that seek to solve problems through forking have a common failure pattern: they may repeatedly split and never truly cooperate. The lessons from Bitcoin Cash’s experience go far beyond Bitcoin Cash itself. Like rebellious cryptocurrencies, rebellious network states need to learn how to execute and build rather than just throw parties, share memes, and compare the modern barbarism of Twitter to 16th-century European architecture. In some ways, Zuzalu is my own attempt to push for this change.
I recommend reading “The Blocksize War” by Bier and “Hijacking Bitcoin” by Patterson and Ver to understand a pivotal moment in Bitcoin’s history. I suggest reading these two books with a mindset that goes beyond Bitcoin alone – instead, it is about the first truly high-stakes civil war of “digital nations” that provides important lessons for other digital nations we will be building in the coming decades.
