Thoughts on scaling and consensus changes (2023)

The value of Bitcoin as a monetary system is rooted in its scarcity and the transparency of its supply, rather than merely the finite size of its blocks. The ability to audit the total number of coins, along with the permissionless nature of transactions and coin ownership, are key factors contributing to Bitcoin's worth. While block size limitations and the mining structure serve a purpose, they are not the primary drivers of value.

If technological advancements allowed for the processing and auditing of extremely large (1 TB) blocks and if there were a reliable mining mechanism that was guaranteed to operate honestly, it could be beneficial to transition to such a system. Under these hypothetical conditions, the utility and value of Bitcoin could potentially increase compared to its current state. The underlying principle is that enhancements aiming at scaling and security without compromising the fundamental attributes of Bitcoin could make it even more valuable.