Received: from sog-mx-4.v43.ch3.sourceforge.com ([172.29.43.194]
	helo=mx.sourceforge.net)
	by sfs-ml-4.v29.ch3.sourceforge.com with esmtp (Exim 4.76)
	(envelope-from <melvincarvalho@gmail.com>) id 1Xi9Eg-0001xn-5g
	for bitcoin-development@lists.sourceforge.net;
	Sat, 25 Oct 2014 21:50:58 +0000
Received-SPF: pass (sog-mx-4.v43.ch3.sourceforge.com: domain of gmail.com
	designates 209.85.215.49 as permitted sender)
	client-ip=209.85.215.49; envelope-from=melvincarvalho@gmail.com;
	helo=mail-la0-f49.google.com; 
Received: from mail-la0-f49.google.com ([209.85.215.49])
	by sog-mx-4.v43.ch3.sourceforge.com with esmtps (TLSv1:RC4-SHA:128)
	(Exim 4.76) id 1Xi9Ee-0001vI-4b
	for bitcoin-development@lists.sourceforge.net;
	Sat, 25 Oct 2014 21:50:58 +0000
Received: by mail-la0-f49.google.com with SMTP id gf13so3035544lab.36
	for <bitcoin-development@lists.sourceforge.net>;
	Sat, 25 Oct 2014 14:50:49 -0700 (PDT)
MIME-Version: 1.0
X-Received: by 10.112.137.39 with SMTP id qf7mr13058305lbb.47.1414273849379;
	Sat, 25 Oct 2014 14:50:49 -0700 (PDT)
Received: by 10.112.1.234 with HTTP; Sat, 25 Oct 2014 14:50:49 -0700 (PDT)
In-Reply-To: <CAE28kUS5otH3q6BPETANw6PaDCrrs1+Sm+LMNnv_TK-viGRFLQ@mail.gmail.com>
References: <CAE28kUS-uDbd_Br3H5BxwRm1PZFpOwLhcyyZT9b1_VfRaBC9jw@mail.gmail.com>
	<CAJHLa0PeB-DMs2zo680FRvaejV-K97k2g0Ti9pPdaNeH+gYmog@mail.gmail.com>
	<CAE28kUSPb3ZC1nJyX7H__7cAgXvOvPbZ+Tub+htGd5+tujZndg@mail.gmail.com>
	<CAJHLa0M20QjBOwhOwJWJUcPBLzmaX1uuPy-6ytvJQWLZy68aeg@mail.gmail.com>
	<CAE28kUS7cr3i-pSew6Y+xvfLEY5D1mi4oHU-GXv+jEf-i_8sVQ@mail.gmail.com>
	<CABsx9T1RPkif1+DEsOLrFfr-sE=FCs_B5C5aZzKr6HZCHw15ag@mail.gmail.com>
	<CAE28kUS5otH3q6BPETANw6PaDCrrs1+Sm+LMNnv_TK-viGRFLQ@mail.gmail.com>
Date: Sat, 25 Oct 2014 23:50:49 +0200
Message-ID: <CAKaEYh+YSjtA-vMWBsWrTjwenB1xxa-pJr3WTykoMGaxEAd8cw@mail.gmail.com>
From: Melvin Carvalho <melvincarvalho@gmail.com>
To: Alex Mizrahi <alex.mizrahi@gmail.com>
Content-Type: multipart/alternative; boundary=089e011609cc6850a20506464a03
X-Spam-Score: -0.6 (/)
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
	(melvincarvalho[at]gmail.com)
	-0.0 SPF_PASS               SPF: sender matches SPF record
	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: 1Xi9Ee-0001vI-4b
Cc: Bitcoin Dev <bitcoin-development@lists.sourceforge.net>
Subject: Re: [Bitcoin-development] death by halving
X-BeenThere: bitcoin-development@lists.sourceforge.net
X-Mailman-Version: 2.1.9
Precedence: list
List-Id: <bitcoin-development.lists.sourceforge.net>
List-Unsubscribe: <https://lists.sourceforge.net/lists/listinfo/bitcoin-development>,
	<mailto:bitcoin-development-request@lists.sourceforge.net?subject=unsubscribe>
List-Archive: <http://sourceforge.net/mailarchive/forum.php?forum_name=bitcoin-development>
List-Post: <mailto:bitcoin-development@lists.sourceforge.net>
List-Help: <mailto:bitcoin-development-request@lists.sourceforge.net?subject=help>
List-Subscribe: <https://lists.sourceforge.net/lists/listinfo/bitcoin-development>,
	<mailto:bitcoin-development-request@lists.sourceforge.net?subject=subscribe>
X-List-Received-Date: Sat, 25 Oct 2014 21:50:58 -0000

--089e011609cc6850a20506464a03
Content-Type: text/plain; charset=UTF-8

On 25 October 2014 21:53, Alex Mizrahi <alex.mizrahi@gmail.com> wrote:

>
> We had a halving, and it was a non-event.
>> Is there some reason to believe next time will be different?
>>
>
> Yes.
>
> When the market is rapidly growing, margins can be relatively high because
> of limited amounts of capital being invested, or introduction of more
> efficient technologies.
>
> However, we should expect market to become more mature with time, and a
> mature market will result in lower margins.
> The halving can do much more damage when margins are relatively small.
>
> Besides that, there is a difference in ecosystem maturity:
>
> 1. Back in 2012, miners weren't so focused on profits, as Bitcoin was
> highly experimental: some were mining for the hell of it (it was a novelty
> thing back then), others wanted to secure the network, others did it
> because it was hard to obtain bitcoins by other means. But now miners are
> mostly profit-motivated: they buy expensive dedicated mining equipment and
> want to maximize profits. As you might know, at one point ghash.io
> reached 50% hashrate, and miners didn't care about it enough to switch to a
> different pool.
>
> 2. Back in 2012, we didn't have multipools. Multipools automatically
> switches between mining different alt-chains to maximize miners' profits.
> Miners who use multipools do not care how their hashrate is used as long as
> they profit off it.
> Particularly, check https://nicehash.com/ -- you can easily buy hashrate
> to attack a smaller alt-coin, for example.
>
> If the halving will result in a significant hashrate drop (and we did
> observe hashrate drop in 2012, although it wasn't that big), it might be
> possible to buy enough hashpower to attack Bitcoin.
>

This is a good point, imho.  Miner sophistication has increased drastically
in 2 years.  Sites like ( http://www.coinwarz.com/ ) can heavily influence
mining, 1-2 orders of magnitude on significant levels of hashing.

I think this is more prevalent with scrypt than sha256, litecoin is set to
half reward in 9 months, and it will be interesting to observe what happens
there.


>
>
>
> ------------------------------------------------------------------------------
>
> _______________________________________________
> Bitcoin-development mailing list
> Bitcoin-development@lists.sourceforge.net
> https://lists.sourceforge.net/lists/listinfo/bitcoin-development
>
>

--089e011609cc6850a20506464a03
Content-Type: text/html; charset=UTF-8
Content-Transfer-Encoding: quoted-printable

<div dir=3D"ltr"><br><div class=3D"gmail_extra"><br><div class=3D"gmail_quo=
te">On 25 October 2014 21:53, Alex Mizrahi <span dir=3D"ltr">&lt;<a href=3D=
"mailto:alex.mizrahi@gmail.com" target=3D"_blank">alex.mizrahi@gmail.com</a=
>&gt;</span> wrote:<br><blockquote class=3D"gmail_quote" style=3D"margin:0p=
x 0px 0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex"><d=
iv dir=3D"ltr"><div class=3D"gmail_extra"><div class=3D"gmail_quote"><span =
class=3D""><br><blockquote class=3D"gmail_quote" style=3D"margin:0px 0px 0p=
x 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex"><div dir=
=3D"ltr">We had a halving, and it was a non-event.<div>Is there some reason=
 to believe next time will be different?</div></div></blockquote><div><br><=
/div></span><div>Yes.</div><div><br></div><div>When the market is rapidly g=
rowing, margins can be relatively high because of limited amounts of capita=
l being invested, or introduction of more efficient technologies.</div><div=
><br></div><div>However, we should expect market to become more mature with=
 time, and a mature market will result in lower margins.</div><div>The halv=
ing can do much more damage when margins are relatively small.</div><div><b=
r></div><div>Besides that, there is a difference in ecosystem maturity:</di=
v><div><br></div><div>1. Back in 2012, miners weren&#39;t so focused on pro=
fits, as Bitcoin was highly experimental: some were mining for the hell of =
it (it was a novelty thing back then), others wanted to secure the network,=
 others did it because it was hard to obtain bitcoins by other means. But n=
ow miners are mostly profit-motivated: they buy expensive dedicated mining =
equipment and want to maximize profits. As you might know, at one point <a =
href=3D"http://ghash.io" target=3D"_blank">ghash.io</a> reached 50% hashrat=
e, and miners didn&#39;t care about it enough to switch to a different pool=
.</div><div><br></div><div>2. Back in 2012, we didn&#39;t have multipools. =
Multipools automatically switches between mining different alt-chains to ma=
ximize miners&#39; profits. Miners who use multipools do not care how their=
 hashrate is used as long as they profit off it.</div><div>Particularly, ch=
eck=C2=A0<a href=3D"https://nicehash.com/" target=3D"_blank">https://niceha=
sh.com/</a> -- you can easily buy hashrate to attack a smaller alt-coin, fo=
r example.</div><div><br></div><div>If the halving will result in a signifi=
cant hashrate drop (and we did observe hashrate drop in 2012, although it w=
asn&#39;t that big), it might be possible to buy enough hashpower to attack=
 Bitcoin.</div></div></div></div></blockquote><div><br></div><div>This is a=
 good point, imho.=C2=A0 Miner sophistication has increased drastically in =
2 years.=C2=A0 Sites like ( <a href=3D"http://www.coinwarz.com/">http://www=
.coinwarz.com/</a> ) can heavily influence mining, 1-2 orders of magnitude =
on significant levels of hashing.<br><br></div><div>I think this is more pr=
evalent with scrypt than sha256, litecoin is set to half reward in 9 months=
, and it will be interesting to observe what happens there.<br></div><div>=
=C2=A0</div><blockquote class=3D"gmail_quote" style=3D"margin:0px 0px 0px 0=
.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex"><div dir=3D"l=
tr"><div class=3D"gmail_extra"><div class=3D"gmail_quote"><div><br></div></=
div></div></div>
<br>-----------------------------------------------------------------------=
-------<br>
<br>_______________________________________________<br>
Bitcoin-development mailing list<br>
<a href=3D"mailto:Bitcoin-development@lists.sourceforge.net">Bitcoin-develo=
pment@lists.sourceforge.net</a><br>
<a href=3D"https://lists.sourceforge.net/lists/listinfo/bitcoin-development=
" target=3D"_blank">https://lists.sourceforge.net/lists/listinfo/bitcoin-de=
velopment</a><br>
<br></blockquote></div><br></div></div>

--089e011609cc6850a20506464a03--