The Blocksize War

There have been a number of controversies, public spats, and factionalization in Bitcoin’s short life. Perhaps the most historically significant was the so-called “Blocksize War” between 2015 and 2017. 

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By this time, Bitcoin had grown in popularity and usage, and network transactions became increasingly slow and costly. One group, known as the “Big Blockers”, advocated for the code to be changed such that transactions could once again be quick and cheap. They wanted each block in the blockchain to increase in size in order to accommodate more transactions per block. Their rivals, the “Small Blockers”, rejected the desires of the Big Blockers, arguing that any such change would centralize Bitcoin and cripple its ability to revolutionize humanity’s relationship with money. The Small Blockers argued that only if Bitcoin blocks remained small would the network remain resilient to attack and corruption.

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As Samson Mow, CEO of Jan3 and former CSO of Blockstream, wrote, the Big Blockers were “mostly business types”, while the Small Blockers were “mostly engineer types”. The former had all of the purportedly pro-Bitcoin companies on their side, along with all of their capital. The latter had developers and users, and far less capital. It was a tale of the big, centralized guns against the small, scrappy, ragtag purists.

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Satoshi Nakamoto himself hardcoded a block size cap of one megabyte into the Bitcoin protocol, although he never expressed why he chose this limit. Some believe that he did so in order to prevent malicious actors from spamming the Bitcoin network with huge blocks containing fake transactions, but this has not been confirmed.

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The Big Blockers did not just complain–they proposed concrete solutions. For example, Mike Hearn created Bitcoin XT, a hard fork software update that would result in block size increasing to eight megabytes and then doubling in size every other year until 2036. Gavin Andreson, the de facto leader of the nascent Bitcoin project at the time, gave Bitcoin XT his stamp of approval. From a public relations perspective, the Big Blockers seemed to have the upper hand in the civil war.

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Nakamoto eventually came out on the side of the Small Blockers, writing in an email (though some believe that his email account was hacked): “If two developers can fork Bitcoin and succeed in redefining what "Bitcoin" is, in the face of widespread technical criticism and through the use of populist tactics, then I will have no choice to declare Bitcoin a failed project.”

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The Small Blockers earned a major win with developer Pieter Wuille’s Segregated Witness, also called SegWit. This was a soft fork upgrade and eventually led to the Lightning Network, a second-layer technology that allows for cheap and quick transactions. In other words, the problem of how to scale Bitcoin as it grew in popularity had been solved without violating the integrity of the original protocol.

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In 2016, Mike Hearn quit the Bitcoin project over the seemingly never-ending block size debates. Bitcoin Classic essentially took Bitcoin XT’s place as the Big Blockers’ favorite new proposal. 

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The nail in the Big Blockers’ coffin was the emergence of Craig Wright, who claimed to be Satoshi Nakamoto himself. Gavin Andreson endorsed Wright’s claim, which worsened the blow to the Big Blockers when it became apparent that Wright was a fraudster.

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Around the same time, the notorious ‘Ethereum DAO attack’ occurred, which many people blamed Ethereum’s recent hard fork on.

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There were more chapters in the blocksize wars, but by this time the tides had turned in favor of the Small Blockers. To this day, the size of a Bitcoin block remains one megabyte. The patient purists won over those who were impatient and willing to compromise Bitcoin’s integrity.

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The entire Blocksize War is a fascinating drama, full of technical details, personalities, twists, and turns. Check out “The Blocksize War”, by Jonathan Bier, for a play-by-play account of what happened.