Received: from sog-mx-2.v43.ch3.sourceforge.com ([172.29.43.192] helo=mx.sourceforge.net) by sfs-ml-1.v29.ch3.sourceforge.com with esmtp (Exim 4.76) (envelope-from ) id 1Xi9Fm-0005P2-Ls for bitcoin-development@lists.sourceforge.net; Sat, 25 Oct 2014 21:52:06 +0000 Received-SPF: pass (sog-mx-2.v43.ch3.sourceforge.com: domain of gmail.com designates 209.85.213.172 as permitted sender) client-ip=209.85.213.172; envelope-from=leishman3@gmail.com; helo=mail-ig0-f172.google.com; Received: from mail-ig0-f172.google.com ([209.85.213.172]) by sog-mx-2.v43.ch3.sourceforge.com with esmtps (TLSv1:RC4-SHA:128) (Exim 4.76) id 1Xi9Fl-0001lq-EQ for bitcoin-development@lists.sourceforge.net; Sat, 25 Oct 2014 21:52:06 +0000 Received: by mail-ig0-f172.google.com with SMTP id h15so1891711igd.11 for ; Sat, 25 Oct 2014 14:52:00 -0700 (PDT) X-Received: by 10.50.78.166 with SMTP id c6mr12353742igx.16.1414273920038; Sat, 25 Oct 2014 14:52:00 -0700 (PDT) MIME-Version: 1.0 References: <2109053.EM3JWxoz5A@coldstorage> From: Alexander Leishman Date: Sat, 25 Oct 2014 21:51:59 +0000 Message-ID: To: Alex Mizrahi , Bitcoin Dev Content-Type: multipart/alternative; boundary=089e01633df29e7ec30506464e93 X-Spam-Score: -0.3 (/) X-Spam-Report: Spam Filtering performed by mx.sourceforge.net. See http://spamassassin.org/tag/ for more details. -1.5 SPF_CHECK_PASS SPF reports sender host as permitted sender for sender-domain 0.0 FREEMAIL_FROM Sender email is commonly abused enduser mail provider (leishman3[at]gmail.com) -0.0 SPF_PASS SPF: sender matches SPF record 0.2 FREEMAIL_ENVFROM_END_DIGIT Envelope-from freemail username ends in digit (leishman3[at]gmail.com) 1.0 HTML_MESSAGE BODY: HTML included in message -0.1 DKIM_VALID_AU Message has a valid DKIM or DK signature from author's domain 0.1 DKIM_SIGNED Message has a DKIM or DK signature, not necessarily valid -0.1 DKIM_VALID Message has at least one valid DKIM or DK signature X-Headers-End: 1Xi9Fl-0001lq-EQ Subject: Re: [Bitcoin-development] death by halving X-BeenThere: bitcoin-development@lists.sourceforge.net X-Mailman-Version: 2.1.9 Precedence: list List-Id: List-Unsubscribe: , List-Archive: List-Post: List-Help: List-Subscribe: , X-List-Received-Date: Sat, 25 Oct 2014 21:52:06 -0000 --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 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
Interesting analysis! I= =C2=A0think there are= a few important effects that aren't being considered.

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?

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 'multipool' mining. Any alt-coin ma= rket vulnerable to the malicious hash-power would probably go into panic mo= de.

-Alex Leishma= n




On Sat Oct 25 2014 at 1:51:10 PM Alex Mizrahi <alex.mizrahi@gmail.com> wrote:
=C2=A0
For the sake of argume= nt, lets assume that somehow (quite unlikely)

Why is it unlikely? Do you believe that the cost of electr= icity cannot be higher than expected mining revenue?
Or do you ex= pect miners to keep mining when it costs them money?
=C2=A0
half the=C2=A0mining equipment gets shut of= f.
The amount of hashes/second is such that it is currently, lets just say, qu= ite
secure against any takeover.

<= div>The equipment won't be simply turned off, it will be up for grabs.<= /div>

Please check this web sites:

<= div>https://nicehash.co= m/

One can use them= in the same way he uses normal mining pools, and they switch between diffe= rent chains.
Say, multipool.us can switch between BTC and PPC (Peercoin).
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.
Which might be attack-on-Bitcoin.
E.g. i= f 60% of bitcoin's total hashrate is available via "multipools&quo= t;, one can try to pull of a double-spending attack.
=C2=A0
Your document makes a long series of ass= umptions about how this can turn out
bad with each individually is implausible, together are just fiction.

It sounds like you failed to g= rasp even basics.
-------------------------------------------------------------= -----------------
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