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What is the maximum data size that each Bitcoin block can contain?

  1. 512 KB

  2. 1 MB

  3. 2 MB

  4. 4 MB

The correct answer is: 1 MB

The correct answer is based on the historical limit set by the Bitcoin protocol, where the maximum size of each block is capped at 1 megabyte (MB). This was established to encourage decentralized participation in the network by limiting block size and, in turn, maintaining quicker block propagation times. Smaller blocks allow nodes with less powerful hardware to connect to the network and participate in the verification process, which enhances the overall security and decentralization of the Bitcoin ecosystem. While there have been discussions and proposals to increase the block size beyond 1 MB to accommodate more transactions, such changes have been met with varied responses from the community, leading to the creation of forks like Bitcoin Cash. However, in the original Bitcoin network, the 1 MB block size limit remains a foundational aspect of its architecture. Other potential options like 512 KB, 2 MB, and 4 MB are all incorrect as they propose sizes that have either never been implemented in the Bitcoin protocol or represent alternative proposals or forks rather than the established limit in the original Bitcoin network. The emphasis on a 1 MB block size underscores the balance Bitcoin strives to achieve between security, decentralization, and transaction throughput.