Three of the biggest Western mining pools – representing a total of some 19% of hashing power on the Bitcoin network – stand divided on raising the block size limit.

An inquiry by Cointelegraph has shown that both KnCMiner and Slush Pool are in favor of Gavin Andresen's proposal(s) to raise this limit. But the biggest of the three, BitFury, is more conservative. As such, a network-wide switch to Bitcoin XT to allow for bigger blocks seems even more unlikely, for now.

Block Size Limit

Lacking consensus among Core developers on how and when to raise the block size limit, former lead developer Gavin Andresen recently shifted his efforts to Mike Hearn's Bitcoin Core fork, Bitcoin XT.

In a hard fork proposal, Andresen schedules to raise the block size limit on Bitcoin XT from 1 to 8 MB by 2016, after which it should double every other year. Andresen hopes that a grand majority of Bitcoin users will make the switch to Bitcoin XT as well. This would effectively enable an increase of Bitcoin's block size limit without reaching consensus on such a change in Bitcoin Core.

An increased block size limit would in turn allow for more than the current maximum of seven transactions per second to occur on the Bitcoin network – though critics have objected to Andresen's approach.

Before the change in Bitcoin XT would go into effect, however, 750 of 1,000 consecutive mined blocks would need to include a message by the miner in approval of the hard fork. As such, some 75% of the total hash rate on the Bitcoin network needs to agree with a shift to Bitcoin XT in order to allow for bigger blocks.

BitFury

Unfortunately, the biggest Western mining pool – BitFury - did not respond to Cointelegraph's inquiry regarding the block size limit. According to Bitcoin Core developer Jeff Garzik, however, the Dutch-American pool that accounts for some 13% of hash power on the Bitcoin network is conservative as it comes to raising this limit. Garzik, who knows the team behind BitFury from several Bitcoin conferences*, said on IRC that BitFury is willing to raise the maximum block size to 2 MB, but not much more.

On the IRC channel for Bitcoin development, #bitcoin-dev, Garzik commented:

“Just heard from the BitFury guys – they are pro-conservative. [...] 2 MB is ok, more is potentially worrisome. [That in] contrast with [Chinese] suggestion [for] 8 MB.”

Given this conservative outlook, it seems unlikely that BitFury will be running Bitcoin XT, or vote for a switch from Bitcoin Core to Bitcoin XT in order to allow for bigger blocks.

- Bitcoin Core developer Jeff Garzik

KnCMiner

Sweden based KnCMiner, the second biggest Western mining pool with 4% of total hashing power on the Bitcoin network, does support a raise of the maximum block size as proposed by Andresen. Most importantly, KnCMiner believes such a raise is required in order for Bitcoin to be able to offer competitive rates for money transfers, as compared to alternatives such as MasterCard.

Speaking to Cointelegraph, KnCMiner explained:

“We would like to see millions of people using bitcoin. To do that we need transaction fees that everyone can afford and is willing to pay. Putting it simply, that means many more paying transactions in each block, not less paying a higher fee.”

Continuing:

“If bitcoin transactions end up costing the same as regular transfers then most of the world won't see any advantages at all. Add to the fact that MasterCard's main argument against bitcoin is the seven transactions per second limit [...] The sooner we fix it the better.”

KnCMiner did not explicitly state whether they will vote for a switch to Bitcoin XT.

Slush Pool

An alternative response came from SatoshiLabs' Slush Pool, which accounts for 2% of hashing power and also produces the Trezor hardware wallet. The Czech Republic based mining pool indicated to not have a strong stance on the block size issue in and of itself.

Speaking to Cointelegraph, SatoshiLabs architect Marek "slush" Palatinus said:

“There's no wide consensus about this topic in SatoshiLabs. My personal opinion is that it really does not matter too much. I think Bitcoin will work normally with 1MB limit as well as with 20MB** limit and I don't see any catastrophic ends in any case.”

Interestingly, however, Palatinus did express to support a hard fork of the Bitcoin protocol in general. Palatinus believes that hard fork changes will need to occur from time to time regardless of the block size limit, and said that this would be a good test case to see how such a fork would be handled by the community.

Palatinus:

“I believe that Bitcoin must evolve, and it can evolve only in case when the community finds a way to achieve wide consensus and do hard forks on periodic basis. For this reason, I prefer Gavin's proposal [to raise the block size limit to 20 MB]**. Not because I care about this particular topic, but because it is interesting to watch how the bitcoin community would cooperate on hard fork process.”

For now it remains unclear if SatoshiLabs will also support a raise of the block size limit through a switch to Bitcoin XT.

- Marek "slush" Palatinus

Bitcoin XT

Given the current hash rate distribution on the Bitcoin network, it seems infeasible that a switch to Bitcoin XT will garner enough support – unless many individual miners switch pools. With the Chinese mining pools F2Pool, BTCChina Pool and Huobi Pool having already refused to make such a shift, and BitFury unlikely to do so, that only leaves some 57% of hashing power to potentially vote in favor of raising the block size.

Even if all remaining mining pools would vote in favor, they would still be some 18% short. So far no mining pool has explicitly stated to vote in favor of a switch to Bitcoin XT in order to allow for bigger blocks.

*Update July 9: Since his comments on IRC, Jeff Garzik has also joined BitFury as an advisor.

**Slush Pool was contacted by Cointelegraph and responded to our inquiry before Andresen published his proposal to raise the block size limit through Bitcoin XT. Although we have reached out to Palatinus once again after Andresen's latest proposal, we have not received a new response before the publication of this article.

Cointelegraph also reached out to BitFury, 21 Inc., Elegius, Ghash.io and Jeff Garzik, but received no response at time of publication. We have unfortunately not been able to reach Telco 214, which accounts for 2% of total hash rate on the Bitcoin network, as there is no contact info on their website (nor have we been able to find this elsewhere).