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The Monero Website mentions these features (besides others):

  • Scalability
  • Decentralization

Yet still any full participant needs to see all transactions which are included in the central block chain (to find transactions one is receiving), and store most of them in order to be able to verify that they are valid.

Looking at the stats from moneroblocks.info, in the last year we had 240059 non-coinbase transactions, and a total block chain size of 3 GB (from Can the Monero block chain be pruned to increase scalability?) (this is for two years, I'll assume).

How is this supposed to scale to billions of people (and companies, etc.) sending money to each other each day (assuming this is meant to be used by almost everyone, not just some geeks)?

I don't think about any explicit limits in block size (those are flexible) here, more about the limits in processing capacity for nodes (even non-mining ones).

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  • @5chdn Can you explain how this is opinion-based? I thought this was a technical question – at least it was meant as such. Maybe it was worded in a too provocant way.
    – Paŭlo Ebermann
    Commented Oct 10, 2016 at 12:54
  • I see multiple issues with this question. 1) You are asking actually two distinct questions. It is preferred if you can post separate questions instead of combining your questions into one. That way, it helps the people answering your question and also others hunting for at least one of your questions. 2) You should only ask practical, answerable questions based on actual problems that you face. 3) How it's stated, the question currently can lead to discussion rather than fact-based, specific answers. If you do not agree with that, you can always create a thread at meta and discuss re-opening.
    – q9f
    Commented Oct 10, 2016 at 13:23

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We say Monero is scaleable because there nothing in the protocol level preventing Monero from accepting a very large number of transactions. There is no coded limit on the block size.

The processing capacity for nodes is based on a few things:

  1. Frequency of transactions

  2. Size of the blockchain

Regarding the first, transactions can not happen faster than nodes can accept and evaluate them. This is limited by the CPU speed, hard drive speed, and internet capacity of the node. It is very unlikely that the rate of transactions could exceed growth rates of 5MB/s, which even a 5400rpm HDD can handle. The most likely limited factor would be network bandwidth, which could make a growth rate of 1MB/s too much for people on slower connections (less than 8 mbps). Keep in mind that Monero (and Bitcoin) have growth rates well below these numbers.

Regarding the second point, this is where the argument is that the total size of the blockchain will become a major barrier to running a node. This is a much more legitimate criticism, and Monero has a larger transaction size than Bitcoin and most/all other coins. There are multiple ways that this concern can be put to ease. First, the cost of hard drives continues to fall. Right now, one can buy a 1TB hard drive that should last for the foreseeable future for less than $50 brand new. Secondly, Monero can still look into options such as pruning to reduce the size of the blockchain. There is currently little research in Monero blockchain pruning because the size of the blockchain is not much of a concern yet. In general, the size of the Monero blockchain is not a large concern for the next few years, and even if Monero becomes much more popular, it will still stay at a reasonable size for a while.

One argument is that the larger the block size, the harder it is to run a node and the more centralized the control will be. This is a valid point, but I do not think the size of the blockchain is intrusive enough to cause any real impact here.

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  • With "growth rate", do you mean the transactions being added to the block chain, or the rate of that increasing? I'm imagining a scenario where Monero (or Bitcoin or whatever other currency) is used by a large part of the people/organizations transferring money, in the order of magnitude of what Paypal or Visa is doing now. I assume that would be more than a single machine (or internet connection) can handle?
    – Paŭlo Ebermann
    Commented Oct 10, 2016 at 12:58

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