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authorAlexander Leishman <leishman3@gmail.com>2014-10-25 21:51:59 +0000
committerbitcoindev <bitcoindev@gnusha.org>2014-10-25 21:52:06 +0000
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Re: [Bitcoin-development] death by halving
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+From: Alexander Leishman <leishman3@gmail.com>
+Date: Sat, 25 Oct 2014 21:51:59 +0000
+Message-ID: <CABW94zRyNWzuRe_xMjj07s+pO5cMEtB7QvR7RiOnTEBbw4xhpw@mail.gmail.com>
+To: Alex Mizrahi <alex.mizrahi@gmail.com>,
+ Bitcoin Dev <bitcoin-development@lists.sourceforge.net>
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+Subject: Re: [Bitcoin-development] death by halving
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+--089e01633df29e7ec30506464e93
+Content-Type: text/plain; charset=UTF-8
+
+Interesting analysis! I think there are a few important effects that aren't
+being considered.
+
+1. When the block reward is halved, inflation is halved as well. Is this
+halving already priced in by the market or will it result in an upward
+pressure on the price?
+
+2. It was acknowledged that the referenced analysis did not take into
+account the result of a double-spend attack on the bitcoin price. However,
+the effect of a detectable double-spend attack on the Bitcoin network is
+not isolated to Bitcoin markets. The price of altcoins often trend with the
+price of Bitcoin, so attacking Bitcoin may reduce the profitability of
+'multipool' mining. Any alt-coin market vulnerable to the malicious
+hash-power would probably go into panic mode.
+
+-Alex Leishman
+
+
+
+
+On Sat Oct 25 2014 at 1:51:10 PM Alex Mizrahi <alex.mizrahi@gmail.com>
+wrote:
+
+>
+>
+>> For the sake of argument, lets assume that somehow (quite unlikely)
+>
+>
+> Why is it unlikely? Do you believe that the cost of electricity cannot be
+> higher than expected mining revenue?
+> Or do you expect miners to keep mining when it costs them money?
+>
+>
+>> half the mining equipment gets shut off.
+>> The amount of hashes/second is such that it is currently, lets just say,
+>> quite
+>> secure against any takeover.
+>>
+>
+> The equipment won't be simply turned off, it will be up for grabs.
+>
+> Please check this web sites:
+>
+> https://nicehash.com/
+> https://www.multipool.us/
+>
+> One can use them in the same way he uses normal mining pools, and they
+> switch between different chains.
+> Say, multipool.us can switch between BTC and PPC (Peercoin).
+> Mining BTC will be less profitable after a halving, so a miner who is
+> willing to maximize his profits might use multipool to auto-switch to
+> something more profitable.
+> Which might be attack-on-Bitcoin.
+> E.g. if 60% of bitcoin's total hashrate is available via "multipools", one
+> can try to pull of a double-spending attack.
+>
+>
+>> Your document makes a long series of assumptions about how this can turn
+>> out
+>> bad with each individually is implausible, together are just fiction.
+>>
+>
+> It sounds like you failed to grasp even basics.
+> ------------------------------------------------------------
+> ------------------
+> _______________________________________________
+> Bitcoin-development mailing list
+> Bitcoin-development@lists.sourceforge.net
+> https://lists.sourceforge.net/lists/listinfo/bitcoin-development
+>
+
+--089e01633df29e7ec30506464e93
+Content-Type: text/html; charset=UTF-8
+Content-Transfer-Encoding: quoted-printable
+
+<div><span style=3D"line-height:19.7999992370605px">Interesting analysis! I=
+</span><span style=3D"line-height:19.7999992370605px">=C2=A0think there are=
+ a few important effects that aren&#39;t being considered.</span></div><div=
+><span style=3D"line-height:19.7999992370605px"><br></span></div><div><span=
+ style=3D"line-height:19.7999992370605px">1. When the block reward is halve=
+d, inflation is halved as well. Is this halving already priced in by the ma=
+rket or will it result in an upward pressure on the price?</span></div><div=
+><span style=3D"line-height:19.7999992370605px"><br></span></div><div><span=
+ style=3D"line-height:19.7999992370605px">2. It was acknowledged that the r=
+eferenced analysis did not take into account the result of a double-spend a=
+ttack on the bitcoin price. However, the effect of a detectable double-spen=
+d attack on the Bitcoin network is not isolated to Bitcoin markets. The pri=
+ce of altcoins often trend with the price of Bitcoin, so attacking Bitcoin =
+may reduce the profitability of &#39;multipool&#39; mining. Any alt-coin ma=
+rket vulnerable to the malicious hash-power would probably go into panic mo=
+de.</span></div><div><span style=3D"line-height:19.7999992370605px"><br></s=
+pan></div><div><span style=3D"line-height:19.7999992370605px">-Alex Leishma=
+n</span></div><div><br></div><div><div><span style=3D"line-height:19.799999=
+2370605px"><br></span></div><div><br></div></div><br><div class=3D"gmail_qu=
+ote">On Sat Oct 25 2014 at 1:51:10 PM Alex Mizrahi &lt;<a href=3D"mailto:al=
+ex.mizrahi@gmail.com">alex.mizrahi@gmail.com</a>&gt; wrote:<br><blockquote =
+class=3D"gmail_quote" style=3D"margin:0 0 0 .8ex;border-left:1px #ccc solid=
+;padding-left:1ex"><div dir=3D"ltr"><div class=3D"gmail_extra"><div class=
+=3D"gmail_quote"><div>=C2=A0</div><blockquote class=3D"gmail_quote" style=
+=3D"margin:0px 0px 0px 0.8ex;border-left-width:1px;border-left-color:rgb(20=
+4,204,204);border-left-style:solid;padding-left:1ex">For the sake of argume=
+nt, lets assume that somehow (quite unlikely)</blockquote><div><br></div></=
+div></div></div><div dir=3D"ltr"><div class=3D"gmail_extra"><div class=3D"g=
+mail_quote"><div>Why is it unlikely? Do you believe that the cost of electr=
+icity cannot be higher than expected mining revenue?</div><div>Or do you ex=
+pect miners to keep mining when it costs them money?</div></div></div></div=
+><div dir=3D"ltr"><div class=3D"gmail_extra"><div class=3D"gmail_quote"><di=
+v>=C2=A0</div><blockquote class=3D"gmail_quote" style=3D"margin:0px 0px 0px=
+ 0.8ex;border-left-width:1px;border-left-color:rgb(204,204,204);border-left=
+-style:solid;padding-left:1ex"> half the=C2=A0mining equipment gets shut of=
+f.<br>
+The amount of hashes/second is such that it is currently, lets just say, qu=
+ite<br>
+secure against any takeover.<br></blockquote><div><br></div></div></div></d=
+iv><div dir=3D"ltr"><div class=3D"gmail_extra"><div class=3D"gmail_quote"><=
+div>The equipment won&#39;t be simply turned off, it will be up for grabs.<=
+/div><div><br></div><div>Please check this web sites:</div><div><br></div><=
+div><a href=3D"https://nicehash.com/" target=3D"_blank">https://nicehash.co=
+m/</a></div><div><a href=3D"https://www.multipool.us/" target=3D"_blank">ht=
+tps://www.multipool.us/</a>=C2=A0</div><div><br></div><div>One can use them=
+ in the same way he uses normal mining pools, and they switch between diffe=
+rent chains.</div><div>Say, <a href=3D"http://multipool.us" target=3D"_blan=
+k">multipool.us</a> can switch between BTC and PPC (Peercoin).</div><div>Mi=
+ning BTC will be less profitable after a halving, so a miner who is willing=
+ to maximize his profits might use multipool to auto-switch to something mo=
+re profitable.</div><div>Which might be attack-on-Bitcoin.</div><div>E.g. i=
+f 60% of bitcoin&#39;s total hashrate is available via &quot;multipools&quo=
+t;, one can try to pull of a double-spending attack.</div></div></div></div=
+><div dir=3D"ltr"><div class=3D"gmail_extra"><div class=3D"gmail_quote"><di=
+v>=C2=A0<br></div><blockquote class=3D"gmail_quote" style=3D"margin:0px 0px=
+ 0px 0.8ex;border-left-width:1px;border-left-color:rgb(204,204,204);border-=
+left-style:solid;padding-left:1ex">Your document makes a long series of ass=
+umptions about how this can turn out<br>
+bad with each individually is implausible, together are just fiction.<br></=
+blockquote><div><br></div></div></div></div><div dir=3D"ltr"><div class=3D"=
+gmail_extra"><div class=3D"gmail_quote"><div>It sounds like you failed to g=
+rasp even basics.</div></div></div></div>
+------------------------------<u></u>------------------------------<u></u>-=
+-----------------<br>
+______________________________<u></u>_________________<br>
+Bitcoin-development mailing list<br>
+<a href=3D"mailto:Bitcoin-development@lists.sourceforge.net" target=3D"_bla=
+nk">Bitcoin-development@lists.<u></u>sourceforge.net</a><br>
+<a href=3D"https://lists.sourceforge.net/lists/listinfo/bitcoin-development=
+" target=3D"_blank">https://lists.sourceforge.net/<u></u>lists/listinfo/bit=
+coin-<u></u>development</a><br>
+</blockquote></div>
+
+--089e01633df29e7ec30506464e93--
+
+