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> I don't understand how can any other group of people decide what should happen other than the miners. You are missing one of the key economic components of B
by Taek 9y ago
> I don't understand how can any other group of people decide what should happen other than the miners.
You are missing one of the key economic components of Bitcoin. Mining costs a lot of money. Nobody mines for free or at a loss, because 'at a loss' means to the tune of hundreds of millions of dollars.
Miners unquestionably mine the chain that has the highest block reward. Historically, hashrate has always been a function of $hardware_efficiency * $block_reward. If the block reward goes down, hashrate goes down (except where hardware efficiency is increasing fast enough to compensate). This is a lot more visible in the altcoin world, where miners can easily jump from coin to coin, and do as the coins fluctuate in value.
So what determines the price of the coin? Well, supply and demand. If people don't like your fork, there will be low demand, and your fork will have a low coin price. This will result in low hashrate, because miners aren't going to be willing (or even capable) of mining your fork at a loss.
Consensus ends up being fundamentally driven by the economics, and the economics follow the userbase.
- Obi_Juan_Kenobi 9y agoI don't think any of that is a contradiction to the main claim that 'miners control the network'. The very fact that miners are beholden to the economics is the key innovation in Bitcoin. It's the magic of the whitepaper. > The incentive may help encourage nodes to stay honest. If a greedy attacker is able to assemble more CPU power than all the honest nodes, he would have to choose between using it to defraud people by stealing back his payments, or using it to generate new coins. He ought to find it more profitable to play by the rules, such rules that favour him with more new coins than everyone else combined, than to undermine the system and the validity of his own wealth. It is precisely because miners have a vested interest in the economics of Bitcoin that they control the network. That's the magic behind 'Nakamoto consensus'. > They vote with their CPU power, expressing their acceptance of valid blocks by working on extending them and rejecting invalid blocks by refusing to work on them. Any needed rules and incentives can be enforced with this consensus mechanism.