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Among the strengths of bitcoin is that it mostly allows all actors to act in their own best interest. There are some actions however of which it is not so clear to me what is the direct incentive other than some kind of idealism.

Obviously it is in a miner's best interest to immediately broadcast a newfound block, or blocks that validate blocks mined by him.

Is there a direct incentive to broadcasting the whole blockchain though (i.e. operating a full node)? Likewise, is there a direct incentive to broadcast all transactions to other nodes immediately? Naively I would think that it could be advantageous to a miner if other miners don't have access to some high-fee transactions.

Of course, for both it is necessary that enough nodes do it for bitcoin to function smoothly, but I am interested in the incentive for an individual miner.

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Note that not all full nodes are miners, and that there are significantly more non-mining full nodes than there are miners (as in the vast majority of full nodes are non-miners).

Is there a direct incentive to broadcasting the whole blockchain though (i.e. operating a full node)?

The incentive for operating an archival node that can serve the blockchain to other peers is that doing so helps maintain the network and thus gives value to the Bitcoin that you are mining.

Likewise, is there a direct incentive to broadcast all transactions to other nodes immediately?

Yes. If run a full node which is not broadcasting transactions, then when you decide to make a transaction, it becomes immediately obvious to your peers as to where that transaction originated from. The incentive is to preserve your privacy.

Even with a delayed broadcast, you would still be risking privacy as your peers would like hear the transactions first from other peers, so as soon as they see you broadcast a transaction that they hadn't seen from elsewhere, it would be reasonable for them to assume the transaction came from you.

  • Thanks Andrew. I meant to exclude indirect incentives like maintaining the network, because while that is beneficial for any user or owner of bitcoin, it is more beneficial if others do it for you. – doetoe Feb 23 '18 at 22:33
  • As an analogy, everybody may agree that paying taxes is necessary to maintain a state, but that doesn't mean that you can make paying your tax voluntary. In the case of a state you can make it mandatory, in the case of bitcoin, as I understand it, it must either be in direct self-interest of the users, or you depend on altruistic behaviour. Could it be that mining makes sense from a point of view of pure self-interest, but running a full node not? – doetoe Feb 23 '18 at 22:33
  • Running a full node has direct effects on the person running it. The incentive is that it lets them have (better) privacy and know that they are using the actual blockchain. There is no monetary incentive, but the incentive is in the security and privacy of their own coins. – Andrew Chow Feb 23 '18 at 22:44
  • I don't mean so much downloading and having the full blockchain, but rather serving it to other nodes. If there were only selfish actors, they'd all want to have the full blockchain, but would not necessarily want to make an effort so that any others can easily obtain the blockchain as well. – doetoe Feb 23 '18 at 22:48
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Yeah, let's say you (and everyone currently invested in bitcoin at the moment) decide you want to stop spending resources on mining and contributing to the maintenance of the blockchain and want to sell out your entire position and take your profits..

what happens to the system when/if the only owners of bitcoin leftover are non-miners or non-blockchain maintainers?

bitcoin has no central bank or government with a vested interest in its survival and integrity so if there's a "run-on-the-bank" so-to-speak, what happens? what's the security?

  • It sounds like you want to "hear hear" the question, so you should vote it up and share it. There's a link you can use for sharing it right under the question itself. What you provided is not an answer to the question. – Dave Scotese Oct 22 '18 at 0:20

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