From his "The resolution of the Bitcoin experiment" post :
"The reason the true limit seems to be 700 kilobytes instead of the theoretical 1000 is that sometimes miners produce blocks smaller than allowed and even empty blocks, despite that there are lots of transactions waiting to confirm — this seems to be most frequently caused by interference from the Chinese “Great Firewall” censorship system. More on that in a second."
"Because the block chain is controlled by Chinese miners, just two of whom control more than 50% of the hash power. At a recent conference over 95% of hashing power was controlled by a handful of guys sitting on a single stage. The miners are not allowing the block chain to grow."
"And the final reason is that the Chinese internet is so broken by their government’s firewall that moving data across the border barely works at all, with speeds routinely worse than what mobile phones provide."
"Right now, the Chinese miners are able to — just about — maintain their connection to the global internet"
So, established by Mike: Chinese miners are currently the largest players, at least 50% of the mining power and they have limited bandwidth which is barely able to operate at current capacity. What is his solution?:
"In August 2015 it became clear that due to severe mismanagement, the “Bitcoin Core” project that maintains the program that runs the peer-to-peer network wasn’t going to release a version that raised the block size limit. The reasons for this are complicated and discussed below. But obviously, the community needed the ability to keep adding new users. So some long-term developers (including me) got together and developed the necessary code to raise the limit. That code was called BIP 101 and we released it in a modified version of the software that […]
