But when all blocks have been mined, there would be no profit in mining.
You've got some things to learn. There's no such thing as "all blocks have been mined".
Topic: Transaction Confirmation if difficulty is very high (Read 914 times)
You've got some things to learn. There's no such thing as "all blocks have been mined".
i am not sure yet how transactions work, altough i have a small idea how minig works.
I would look at a manual or other reference to understand better this things.
Got to catch up!
I would look at a manual or other reference to understand better this things.
Got to catch up!
I think that Bitcoin will fall in the long term, unless bitcoin banks or governments ask fees too keep hashing.
Block rewards and transaction fees provide the incentive to keep mining so I don't think there is any real *difficulty* for miners to make money from mining Bitcoin for the foreseeable future (although if there was a massive loss of confidence and the price dropped to < 1 USD the mining activity would certainly be less but even then not likely to stop as some miners have free electricity).
But when all blocks have been mined, there would be no profit in mining.
Wouldn't there be the chance of the 50%+ failure?
The one that hashes more than 50% of the network would be able to 'hack' the system, or did i misunderstand that?
Note that in case of a such big problems a new client can fix that. Yup it would be a hard fork, but if something fuck 99% of mining power then the situation would be bad enough that a hard fork would be acceptable.
Already been stated:
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Finally, assuming that enough people shut down their mining rigs to create a situation where the next difficulty adjustment is years away, there is potential, with something close to a consensus of users, that the difficulty calculation could be adjusted. Things would have to get pretty dire to gain a consensus on the matter, but it would be technically feasible.
Finally, assuming that enough people shut down their mining rigs to create a situation where the next difficulty adjustment is years away, there is potential, with something close to a consensus of users, that the difficulty calculation could be adjusted. Things would have to get pretty dire to gain a consensus on the matter, but it would be technically feasible.
What about situation when we have huge difficulty and bitcoin price collapses making mining unprofitable for almost all miners?
The least efficient miners will quit, difficulty will lower and eventually a new equilibrium will exist.
The problem that aaaxn is alluding to is that difficulty doesn't drop for 2016 blocks. If there is a very very large, very very sudden drop in mining hashpower (for example 99.3% of hashing power suddenly disappears) the time between blocks can drop significantly (a loss of 99.3% of hashing power would lead to the network finding 1 block per day). This could result in a significant delay until the next difficulty adjustment (If a drop to 1 block a day occurred immediately after a difficulty adjustment, it would take 5 and a half years until the next difficulty adjustment).
Of course the scenarios that might lead to more than 99% of the network hashing power disappearing within a 10 minute period after a difficulty adjustment are rather limited and unlikely. If we lost 90% of the hashing power, the time between blocks would grow to just 84 minutes. This would result in just 117 days to the next adjustment.
What about situation when we have huge difficulty and bitcoin price collapses making mining unprofitable for almost all miners?
The least efficient miners will quit, difficulty will lower and eventually a new equilibrium will exist.
Note that in case of a such big problems a new client can fix that. Yup it would be a hard fork, but if something fuck 99% of mining power then the situation would be bad enough that a hard fork would be acceptable.
I think you miss the point of the Difficulty. It exists to throttle the number of new blocks to one every 10 minutes. So as the hash rate increases so does the difficulty.
Did it drop far below profitability then? Imagine difficulty so high that mining is barely profitable on asic with current prices and then vitcoin looses 95% of value
Oh c'mon difficulty depend on total mining power and total mining power depend on bitcoin price, wich determine mining profitability.If it is not profitable to mine then some miners will stop, difficulty will drop and it will be profitable again.
The problem that aaaxn is alluding to is that difficulty doesn't drop for 2016 blocks. If there is a very very large, very very sudden drop in mining hashpower (for example 99.3% of hashing power suddenly disappears) the time between blocks can drop significantly (a loss of 99.3% of hashing power would lead to the network finding 1 block per day). This could result in a significant delay until the next difficulty adjustment (If a drop to 1 block a day occurred immediately after a difficulty adjustment, it would take 5 and a half years until the next difficulty adjustment).
Of course the scenarios that might lead to more than 99% of the network hashing power disappearing within a 10 minute period after a difficulty adjustment are rather limited and unlikely. If we lost 90% of the hashing power, the time between blocks would grow to just 84 minutes. This would result in just 117 days to the next adjustment.
lets not forget that 'omg i need to wai day for transaction cofirmation' can have effect on alreafy depressed prices
Did it drop far below profitability then? Imagine difficulty so high that mining is barely profitable on asic with current prices and then vitcoin looses 95% of value
Oh c'mon difficulty depend on total mining power and total mining power depend on bitcoin price, wich determine mining profitability.If it is not profitable to mine then some miners will stop, difficulty will drop and it will be profitable again.
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Imagine difficulty so high that mining is barely profitable on asic with current prices and then vitcoin looses 95% of value
Imagine difficulty so high that mining is barely profitable on asic with current prices and then vitcoin looses 95% of value
To answer your question, we'd have to have a good estimate of the amount of hashing power that makes use of free electricity (or at least electricity where they don't pay per watt hour). Those individuals will pretty much remain profitable no matter how far the value drops.
Next we need an estimate of how many people will continue to mine at a loss under the assumption that the price will recover. Of those, we need to know how long each one will wait for a recovery before they give up and shut down their miners.
Finally, assuming that enough people shut down their mining rigs to create a situation where the next difficulty adjustment is years away, there is potential, with something close to a consensus of users, that the difficulty calculation could be adjusted. Things would have to get pretty dire to gain a consensus on the matter, but it would be technically feasible.
Did it drop far below profitability then? Imagine difficulty so high that mining is barely profitable on asic with current prices and then vitcoin looses 95% of value
What about situation when we have huge difficulty and bitcoin price collapses making mining unprofitable for almost all miners?
When it dropped to just below 2 USD the difficulty still didn't drop dramatically (i.e. block confirmations were not taking much more than 10 minutes) so I think there are enough miners that either (a) have free electricity or (b) are long on Bitcoin to keep it alive.
What about situation when we have huge difficulty and bitcoin price collapses making mining unprofitable for almost all miners?
Loosing half the network hashing power increases the time from 10 minutes to 20 (and increases the time until the next difficulty adjustment to no more than 4 weeks). Loosing 75% increases it to 40 minutes per block and the next adjustment in less than 2 months.
Indeed - so ASIC or no ASIC the likelihood of such a drop would require something like a global EMP event.
For that to occur the hashing power would need to drop dramatically (basically all ASIC would have to have somehow been stopped from mining)
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Assuming that "a few days" means 3 days, you'd need to loose a lot more mining power than that. To drop from every 10 minutes to every few days, you'd have to loose 99.77% of the mining power on the network. I know ASIC are supplying a lot of hashing, and that in the future it will be even more, but I think it will be a while before 99.77% of the network hashing power comes from ASIC.
Loosing half the network hashing power increases the time from 10 minutes to 20 (and increases the time until the next difficulty adjustment to no more than 4 weeks). Loosing 75% increases it to 40 minutes per block and the next adjustment in less than 2 months.
I think that Bitcoin will fall in the long term, unless bitcoin banks or governments ask fees too keep hashing.
You don't seem to understand how Bitcoin works?Banks and governments is exactly not what Bitcoin needs.
An important thing to remember is that difficulty follows hashing power, not the other way around. The OP's question seems to stem from the idea that difficulty always increases, which does not happen.
I think that Bitcoin will fall in the long term, unless bitcoin banks or governments ask fees too keep hashing.
Block rewards and transaction fees provide the incentive to keep mining so I don't think there is any real *difficulty* for miners to make money from mining Bitcoin for the foreseeable future (although if there was a massive loss of confidence and the price dropped to < 1 USD the mining activity would certainly be less but even then not likely to stop as some miners have free electricity).
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