Adam Back, an early Bitcoin developer and co-founder and CEO of Blockstream, has looked into the discussion about what the Bitcoin blockchain calls “JPEG spam.”
Buck claims that it undermines the core purpose of cryptocurrency as money in Friday’s X (formerly Twitter) thread.
Bitcoin should be considered “managed” and that developers act as “stewards” and that user consensus should essentially change the network. That principle was strengthened during the block-size wars of 2015-2017, he added.
Back was aiming for a surge in JPEG inscriptions. Images stored directly in Bitcoin via Taproot upgrades and the ordinance protocols it created.
The number of JPEGs embedded in Bitcoin ledgers rose 20%, up from 88 million in May to 105 million in September. The total fees associated with these inscriptions are approximately 7,000 BTC ($777 million).
Bitcoin Core Mission
Meanwhile, proponents of the development made possible by taproot upgrades claim that it is a valid use of the network, unless the user is willing to pay for block space.
Because it is an unauthorized system, we cannot dictate what Bitcoin can and cannot be used. This is because it goes against the spirit of decentralization that it was built on.
Additionally, “JPEG Spam” enhances the economic incentives for miners to maintain their Bitcoin network.
Minors benefit from higher rates, but Buck argues that the effect is minimal when the hash rate increases and costs are taken into account. He estimates that the JPEG inscription could contribute just 0.1% to mining profits.
A divided community
So the problem is divisive in the Bitcoin community.
Supporters view the inscription as legitimate economic activity and use of blockchain. Critics, including Buck, say they will waste block space and replace activities that will strengthen Bitcoin’s value proposition.
Possible remedies for backfloats, including outreach to miners and pools to block the processing of such transactions, and wallet-level changes that could potentially entrust fees to those who refuse them. There is a warning of centralized risk, but he suggested that even small economic tweaks could prevent the inscriptions of JPEG from mining.
Read more: Bitcoin’s debate about loose data restrictions reminds us of the dispute of a divisive ritual
