Re: [Bitcoin-development] death by halving
On Oct 25, 2014 9:19 PM, Gavin Andresen gavinandre...@gmail.com wrote:
We had a halving, and it was a non-event.
Is there some reason to believe next time will be different?
In november 2008 bitcoin was a much younger ecosystem, with less liquidity
and trading, smaller market cap, and the halving happened during a quite
stable positive price trend.
In the next months competition might easily drive down mining margins, and
the reward halving might generate unexpected disruption in mining
operations.
Moreover, halving is not strictly necessary to respect the spirit of
Nakamoto's monetary rule and its 21M limit. At the beginning of the 3rd
reward era (block 42, in 2017) a new reward function could become
effective R(b)=k*2^(-h*b/21) where b is the block number and R(b) is
the reward. The parameters h and k can be calibrated so that R(41)=25
and sum_b{R}=21M
If the increased issuance speed in the third era is considered
problematic, then each era could have its own R_e(b)=k_e*2^(-h_e*b/21)
fitted to the amount of coins to be issued in that era according to the
current supply rule, e.g. fitting k_e and h_e to R(41)=25 and
sum_{b}_e=2,625,000.
Would such a BIP have any chance to be considered? Am I missing something?
Nando
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Re: [Bitcoin-development] Fwd: death by halving
In november 2008 bitcoin was a much younger ecosystem, Or very old, indeed, if you are using unsigned arithmetic. [...] :-) I meant 2012, of course, but loved your wit and the halving happened during a quite stable positive price trend Hardly, http://bitcoincharts.com/charts/mtgoxUSD#rg60zczsg2012-10-01zeg2012-12-01ztgSzm1g10zm2g25zv indeed! http://bitcoincharts.com/charts/mtgoxUSD#rg60zczsg2012-08-01zeg2013-02-01ztgSzm1g10zm2g25zv There is a lot more complexity to the system than the subsidy schedule. who said the contrary? This thread is, in my opinion, a waste of time. it might be, I have some free time right now... many people have performed planning around the current behaviour. The current behaviour has also not shown itself to be problematic (and we've actually experienced its largest effect already without incident), and there are arguable benefits like encouraging investment in mining infrastructure. I would love a proper rebuttal of a basic economic argument. If increased competition will push mining revenues below 200% of operational costs, then the halving will suddenly switch off many non profitable mining resources. As of now the cost per block is probably already about 100USD, probably in the 50-150USD. Dismissed mining resources might even become cheaply available for malevolent agents considering a 51% attack. Moreover the timing would be perfect for the burst of any existing cloud hashing Ponzi scheme. From a strict economic point of view allowing the halving jump is looking for trouble. To each his own. -- ___ Bitcoin-development mailing list Bitcoin-development@lists.sourceforge.net https://lists.sourceforge.net/lists/listinfo/bitcoin-development
Re: [Bitcoin-development] Fwd: death by halving
On Tue, Oct 28, 2014 at 10:34 PM, Neil kyuupic...@gmail.com wrote: Economically a halving is almost the same as a halving in price (as fees take up more of the pie, less so). Coincidentally the price has halved since early July to mid-October, and we've not even seen difficulty fall yet. because mining profits are many times operational costs. This might change because of competition, in that case halving in price will become problematic. It amazes me that basic economic considerations seems completely lost here, especially when it comes to mining. We should have learned the lesson of how a small error in the incentive structure has lead from one CPU, one vote to an oligopoly which might easily become a monopoly in the near future. -- ___ Bitcoin-development mailing list Bitcoin-development@lists.sourceforge.net https://lists.sourceforge.net/lists/listinfo/bitcoin-development
Re: [Bitcoin-development] Fwd: death by halving
On Tue, Oct 28, 2014 at 11:00 PM, Thomas Zander tho...@thomaszander.se wrote: you didn't read the archives where these ideas have been brought forward and discussed, a consensus was reached. (it wasn't so basic afterall) The fact that people don't want to repeat the discussion just for your sake is not the same as people not listening to those arguments. I didn't start the thread and so didn't research the archive. Until two posts ago there was no reference about the issue being discussed before. A link would have been much kinder than harsh dismissal. I will research and read. -- ___ Bitcoin-development mailing list Bitcoin-development@lists.sourceforge.net https://lists.sourceforge.net/lists/listinfo/bitcoin-development
Re: [Bitcoin-development] Fwd: death by halving
On Tue, Oct 28, 2014 at 10:43 PM, Gregory Maxwell gmaxw...@gmail.com wrote: As of now the cost per block is probably already about 100USD, probably in the 50-150USD. This is wildly at odds with reality. I don't mean to insult, but please understand that every post you make here consumes the time of dozens (or, hopefully, hundreds) of people. Every minute you spend refining your post has a potential return of many minutes for the rest of the users of the list. At current difficulty, with a SP30 (one of the leading-in-power-efficiency) marginal break-even is ~1144.8852 * $/kwh == $/btc. At $0.10/kwh each block has an expected cost right now, discounting all one time hardware costs, close to $3000. yes, you're right I meant about $100USD per BTC, i.e. $2500 per block. Because of my mistake I'll shut up and go back researching the archive on this issue. Thank you for the kind summary of the many good reasons why halving is a non-issue. Very much appreciated, especially considering how precious is your time. -- ___ Bitcoin-development mailing list Bitcoin-development@lists.sourceforge.net https://lists.sourceforge.net/lists/listinfo/bitcoin-development
