So, with news that the blockchain is now consistently hitting full blocks, let’s take a step back to understand exactly what this means.
Essentially a full block will occur when there are too many transactions to fit in the current 1Mb block size. Transactions not accepted will roll over to the next block, although if this is also full then there is no guarantee that it will be accepted. The current block size average is gradually inching towards the limit, especially since we have been seeing a surge in volume and price lately.
The average block size is currently hitting around 0.80 Mb and the increasing trend can be seen in the chart below:
There is a default prioritization on which transactions should be included in a block, but this can be overridden by miners who are free to choose which transactions they wish to accept. (E.g. on Eligius FAQ page under 'Transaction Processing', they publicly state how transactions are selected).
This is likely to mean that fees will go up, as miners will favor transactions with higher fees attached. So if you want your transaction to be processed in the shortest possible time: you should pay more.
Cointape.com, for example, offers a service showing an estimated delay in terms of both blocks and minutes, depending on the level of fees paid.
Of course, the issue of block size is currently under discussion and there is no need to rehash that debate here. Though whether the fact that blocks are now brushing the ceiling will galvanize the community to a faster consensus remains to be seen. On the flipside, a speedy transition could also prove to be an unhealthy knee-jerk reaction that could have a negative impact on Bitcoin. The 1Mb block limit was a last minute addition to the protocol as a reaction to prevent spam, and the resulting legacy is something that we probably don't want to repeat in a hurry.
So for now, it seems that we will continue to see increasing fees or longer transaction times. But as Bitcoin’s major selling points are fast transactions and low processing fees, we should ask just how sustainable this will be going forward.
What do you suggest as the solution? Will the issue be resolved before we reach critical mass? Please share and comment below.
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