Topic: Block 209999 - a short history of the Bitcoin civil war (Read 4479 times)

Whew civil war averted.  We likely should immortalize some quotes for the historians on this day where we so narrowly avoided outright conflict.

Author unknown - first cite shortly after block 210,000

Author unknown - first cite shortly after block 210,000

Author unknown - first cite shortly after block 210,000

Author unknown - first cite shortly after block 210,000


Historical Footnotes:
*A score is 20 years so a micro score would be 20/1000 = 0.02 years.
** "network of networks" is old timey speak for the intertubes.

Prepare block 420000 FUD!

Oh snap 420k get it get it? drug conspiracy imo.

Not a bad prediction for halving day price of $12.30

Wow! A lot of speculating on the grand event of the reward being halved.

Here's my speculation and what I believe to be a more realistic scenario:


1) All the investors, speculators, and day traders see this as a sure sign that bitcoin prices will rise by at least 100% because the money injection rate will be halved and start pricing it in 3 to 6 months prior.
2) The mining profit will increase this will be followed by old miners returning and even some new miners trying it out for the first time.
3) Around the date (before and after), the prices become extremely volatile and will be great for day traders.
4) The Mid term price after this event will probably come off of it's peak by 25% to 50% followed by a longer trend of stabilizing somewhere between $8 dollars to $12 dollars.
5) As the price decreases from its peak in a long term decline, some miners will leave and the slightly profitable mining venture will be much like it is today.

The sure thing is I will continue mining even at a loss for Bitcoin's success and I will continue dropping $50 to $100 dollars a month for additional bitcoins.

Good luck to all.

Rather than forking, perhaps an alternative inflationary chain could be developed that derives its value from bitcoin. Akin to the gold standard, where the gold becomes the bitcoins and the inflationary currency is linked to it. In the far future, I could even imagine printed money like our current currency, but backed by bitcoins. Bitcoins would become a storage of wealth (similar to gold), the other currency or even currencies,  a method to conduct financial transactions.

They can change the algorithm, I agree, but they won't. If this hypothetical group of rouge miners collectively vetoes Satoshi's original algorithm to protect their profits, then they will also veto any other algorithm which threatens their profits.

In other words, if they collectively chose to reject Satoshi's curve, then it logically follows that they will reject Pieter Wuille's curve. No offense to Pieter Wuille, but he's a nobody compared to Satoshi. Satoshi is literally the God of bitcoin. If the miners can reject the Word of God then they can reject any other community member's suggestion. 


I'm no fan of the global fiat printing consortium, but a little expansion of the money supply is definitely a good thing. It's even better when said expansion is:
1. Algorithmically determined (as opposed to a secret cabal of bankers)
2. Completely public (M3 anyone?)
3. Democratically chosen (don't like 4%? Get 51% of miners to join you and fork the chain. Quickest election in human history, with global participation)

Someone correct me if I'm wrong, but inflation only occur when the growth of the money supply outpaces the growth of the economy.

As per point #3 above, the democratic process will keep the bitcoin growth closely matching the bitcoin economy growth. When the two growth rate equal each other, zero inflation will result. Personally I think this solution is much better than both the Fed and Satoshi's 21 million hard limit.

If my understanding of the Austrian school is correct, they're against government-sponsored inflation, not growth of the money supply itself. I wager that the Austrian economists would rank this laissez faire scheme to grow the money supply higher than Satoshi's deflationary measures.

I think that we must act quickly before Google/Apple/Amazon/Microsoft/Facebook launches a competing block chain (after having mined a few million themselves) and pushes their own version of secure cash to ~500 million users in one fell swoop.

The WeUseCoins video is great, as it's professionally done and coherent enough to get a good overview of Bitcoin. But we really need new videos & a better bitcoin.org that eases the newbie into the material without simply saying "it's in the wiki."

This is true. What also is missing is a good rhetoric. My initial excitement about Bitcoin continues, and the reasons persist, but there aren't very convincing arguments put forward for people alien to hardcore computing or economy, and I realize that I can't put into words why the concept is very convincing for me. It's just that the humanity needs it, and there are a multitude of reasons why. As with a lot of free projects, we would all be better off if everyone used it, but the scene lacks coherence and simple introduction.

To the extent there is a 'civil war', it is not in the mining nor off in the future. It is in the economics of Bitcoin and it is in the now. It is a 'class war' in the sense that what Bitcoin most desperately needs is its own investors, Venture Capitalists.

https://bitcointalksearch.org/topic/screw-deflation-to-the-moon-bitcoin-needs-help-now-45390

Otherwise it's just "Bitcoin-to-the-mooooon", aka Bruce Wagner mesmerizing the Bitcoin wealthy while the rest of us break rock for pyramid building, until we're so used up that we drop out.

Bitcoin is bloody brilliant, but without the Bitcoin wealthy being able to see that it is in their own best interest to invest, with major VC Bitcoin, then what I see coming is great swaths of idealists (one after another) falling on their swords for the cause.

That would be the case if this was an unexpected thing. You know the rules perfectly, and make your investment accordingly. I can get that some miners might be upset because of the recent downwards price trend, but it would be nonsensical to get upset about something you know about years in advance. This also the reason the difficulty switch will be mostly seamless. All serious miners will be prepared for this months in advance.

heh except now you have half a network of angry miners with useless rigs

You're probably right... but still, they wouldn't be able to spend their coins while the attack lasts, as everybody else.


I agree it sets a dangerous precedent, but to keep bitcoin principle of having a stable monetary base one day, I might be willing to accept some degree of centralization while the attack lasts.

Not at all. They are colluding on the main chain, so they mine 100% of it's blocks (as empty, but it does not matter as far as the 25BTC reward is concerned). They are defending the alternate chain, so they earn close to 100% of blocks there. When non-rebel miners start to migrate to the alternate chain, resources can be reallocated there so as to keep the rebels share high without loosing control of the main thread. When all miners have migrated to the alternate chain the rebels will have 75% there, the exact starting situation. It's a win-win situation regardless of the outcome of the revolution, so they are not risking anything.


I can think of ways to combat this but a certain degree of centralisation would indeed kill the attack. In the extreme, a checkpointed blockchain published by the developers every day the attack continues. Any transaction would clear in at most a day despite the attack. However this would also require client upgrades, and set a dangerous precedent. Would you upgrade to the alternate but still distributed chain or to a centralised chain ?

Oh, and there has already been discussion about setting the stock client to reject blocks that don't contain enough transactions known by the node.  It was proposed in the context of a miner not including charity (zero fee) transactions, but can easily be extended to deal with this scenario.

As in, if a mining cabal wanted to mess with the system by producing an unending stream of empty blocks while transactions piled up in memory pools, the network could reject the hostile blocks and operate as usual.

Oh, and there's another point. It would be difficult (expensive) to perform such attack. I explain:

Let's suppose 75% of miners (in terms or processing power, not absolute numbers) decide to collude to perform such 'coup'. Honestly, I find it way too much than what could possibly happen, but just for the sake of the argument let's keep it 75% against 25%.

In order to stop the network maintained by the remaining 25%, they would have to dedicate more than one third of all their mining power to create such fake chain. They would not be able to collect transaction fees and even the generation money they get from those 25BTC blocks would be frozen - even if they organize it well enough to make themselves capable of spending, what's not trivial, still, nobody else would be accepting bitcoins while the network is frozen like that.

So, they burn more than one third of their processing power on a chain they want to kill, and the remaining processing power they spend on a chain that, for the moment, is useless - with few to none hard guarantees it will ever be truly used. I find it more likely that bitcoins users and developers would accept to temporarily compromise the decentralization of the network in order to fight back this attack* (I would), than to surrender to these Bernanke-wannabe-miners.

It would be a risky (not to mention immoral) "investment" to perform such an attack. Maybe even riskier than just keep mining 25BTC blocks in the hope that, with less inflation, bitcoin's value will increase and pay off the expenses.


* You can fight a >50% attack by establishing a set of "trusted transaction pools" that would be observed by every bitcoin client. Clients could then only accept blocks that contain a minimum percentage of transactions that were present in these pools. Blocks with only fake transactions would be rejected. That obviously introduces centralization and for that reason is not at all desirable, but in an emergence situation like that, I might temporarily trust some of the developers to implement such thing.

It's not going to be a bitcoin civil war....   it's going to go to 25 BTC .. and I believe it's not soon enough...   I know I keep repeating myself.. but the fact is that we are printing off too many bitcoins at this time...   

If miners want to double the number of bitcoins allocated EVEN IF IT WORKED, which it won't,  the problem will be each bitcoin will be worth 1/2 as much...  in other words a zero sum game.

They'll just follow the path because it's a huge fight for ZERO gain.

To take the fees successfully your block must not be overwritten. It can't be just someone, it must be enough miners to produce blocks faster than the rogue miners.

That said, I don't think the scenario described by OP is likely to happen. If miners were willing to organize themselves like that, as OP says himself, they could do it right now.
My 2 cents on why they don't do it now, and won't do it then:

• Most people are not jerks like that. (Seriously, most people wouldn't deliberately break other people's stuff just for a little profit)
• Miners probably understand that the less bitcoins out there, the more they're worth. I'm basically talking about the same thing Littleshop said above.

So...if all of the miners switch to a new client...

would that mean that I could mine on the existing client and get all of the booty for myself on a network that is used by everyone else?

If we dont get a 100x increase in transaction fees by 2013, none of this really matters, as bitcoin will remain an obscure nerd experiment. Note I say transaction fees, not transactions. The current transaction fees are ridiculously low, which is whats you'd want for speculation, which is the vast bulk of current transactions, but if you do actual trade, few would mind spending 10x as much or even more to get fast confirmations.


Because the smart miner will understand that he can get better prices for his hardware if he gets out early.

The fees on queued transactions will pile up and eventually be taken by someone. It might take some time for fees to fund competition, but it will happen eventually.