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Interesting theory but how can China control Bitcoin if there's nothing stopping people in other countries from mining it?

howlin 9y ago
The majority of the hash power is in China. If China can seize the miners all at once, they'll have control over the blockchain. At that point, other countries would be foolish to compete, and may focus on alternate alt currencies.
- tboyd47 9y ago
  But they still can't change the blockchain. And there would still be miners outside of China.
  - XR0CSWV3h3kZWg 9y ago
    If you control 50 + epsilon percent of the hash power you can censor blocks at will. You can ignore every block that anyone else makes and still have the longest chain.
    - tboyd47 9y ago
      Except for the fact that they can still get confirmation from the other 50 - epsilon percent. Having 51% of hash power doesn't mean you mine 100% of blocks. That's not how Bitcoin works. With 51% you will probably mine around 51%.
      - Dylan16807 9y ago
        You're forgetting that every miner chooses how they mine. Someone with 51% hash power can decide to always mine on top of their previous block, ignoring what everyone else does. And because the 51% chain is longer, the 49% chain get discarded by any miner following default bitcoin rules. So the effective block rate gets slowed down, and the person with 51% of the power has control of 100% of the canonical blocks.
        tboyd47 9y ago
        This would make the 51% miners' chain grow at half the speed as the 49% miners' chain, because the 49% are building on both their blocks and the other miners' blocks, whereas the 51% are only building on their blocks. This, of course, is assuming that the 51% doesn't create blocks considered invalid on the other chain. This would cause a hard fork and it's exactly what is happening now with Bitcoin Cash, except with a much smaller fraction than 51%. So no, what you are describing cannot happen with the default rules.
        Dylan16807 9y ago
        > the 49% are building on both their blocks and the other miners' blocks, whereas the 51% are only building on their blocks. They are building on some of their blocks and some of the other miner's blocks. This doesn't make them faster. Whenever a 49%er mines a block, there is a temporary fork. The 49% and the 51% start mining on two completely separate branches, both of which progress at half speed. Eventually the 51% branch is longer, and the 49% discard their previous work and switch to it. So the 49% were using their blocks, and now they are using the 51% blocks, but never both at the same time. The canonical blockchain does not progress at full speed. Half the blocks that get mined eventually become orphans. It would be impossible for the 49% to build on everyone's blocks, because the 51%-created blocks are always mutually incompatible preexisting 49%-created blocks. > This, of course, is assuming that the 51% doesn't create blocks considered invalid on the other chain. Yes, of course.
        tboyd47 9y ago
        If this were so then Bitcoin Cash would have been dead from the start. They hard forked with much less than 49% of hashpower. There are really two separate scenarios we're talking about here. Miner activated hard forks, which are a real thing that have happened (though not exactly like you describe), and a hypothetical situation where a group of miners agree to create an exclusive chain that is also backwards compatible. I'm no expert but I don't think that would have the intended result.
  - freeloop2 9y ago
    You can effectively freeze anyone's funds by refusing any transactions that originate from their address
strgcmc 9y ago
Nothing "stopping" it, except the tens (hundreds?) of millions of dollars worth of hardware investment it would take before your new hashrate becomes at all competitive. It's a bit like saying there's nothing stopping you from launching your own soft drink and beating out Coca Cola (you could try, but you probably won't win). China has a huge and possibly insurmountable lead in not just existing built hardware, but a head start in the know-how of rolling out new ASIC designs to production, (relatively) cheap factories to mass-produce hardware, access to cheap/state-subsidized electricity, and (in this hypothetical scenario of nationalization) the support of the central government of one of the largest/most-powerful nations on Earth.
- tboyd47 9y ago
  Miners have very little power over Bitcoin as a whole. They are constrained both by Bitcoin's rules and economics. If they mine invalid blocks or optimize for something other than fees, the operation will turn unprofitable. If they just stop mining, the mining difficulty will adjust and suddenly ASICs will not be needed to turn a profit. There is a delicate balance in Bitcoin, currently tipped slightly in their favor, that they probably don't want to disrupt.
  - imron 9y ago
    > Miners have very little power over Bitcoin as a whole. Chinese miners currently control significantly more than 50% of Bitcoin mining. If the government takes control of the the miners, they take control of the bitcoin network. There's plenty of mischief they could make with that if they were so inclined.
    - tboyd47 9y ago
      Your reply does not refute the point you quoted in any way, nor does it address the other points I made. You are merely restating what the other person said in an equally hand-wavy manner.
  - XR0CSWV3h3kZWg 9y ago
    Miners obviously are okay taking a hit as there are plenty that are working on the less profitable BCH chain.
tannerbrockwell 9y ago
China will nationalize the domestic creation of Bitcoin. This is their sphere of influence. Thus they will control the domestic production of bitcoins. This nationalization will kick off the next leg up of the exponential growth for bitcoin. Just as the US Marshals auctioning off the Silk Road coins established legality in the American market. China will want to control capital flight and will use bitcoin as the release valve for their outrageously overhigh investment in US Treasuries.
- tboyd47 9y ago
  Bitcoins are not like some manufactured physical item where a group of people can collectively seize the means of production with force to control supply of said item. It would be kind of funny if the CCP views it that way but I doubt they do. They probably have more knowledge about how Bitcoin works than everybody on HN combined.
  - tannerbrockwell 9y ago
    The miner's mining Rig's are plugged into the state controlled power grid. If China wants to control the means of production, they simply follow the power hogs, remember we're talking about operations that are industrial scale. The small players have 500+ mining rigs alone. The means of production will be seized. Existing coins are a toss-up. Although since the penalty could be a death sentence, I'm sure the business's that have these will comply with what ever orders follow.
    - tboyd47 9y ago
      You are still thinking about this in terms of a physical object. Miners don't "produce" anything except in the same sense that I "produce" the answer to a crossword puzzle. You can take away my pencil but it doesn't make the puzzle unsolvable.
      - tannerbrockwell 9y ago
        Dude. The mining rigs are physical. All I said was that China will seize the 'means of production' so they control the manufacture domestically. It's a phrase that was used a lot to describe the basic tenets of different types of economy and harkens to a time when industrialization was a major focus of the first world and people trying to find their place in an industrial society. The "means of production" phrase has been distilled and entered the zeitgeist as a way to talk about communism.

howlin 9y ago

The majority of the hash power is in China. If China can seize the miners all at once, they'll have control over the blockchain. At that point, other countries would be foolish to compete, and may focus on alternate alt currencies.

tboyd47 9y ago
But they still can't change the blockchain. And there would still be miners outside of China.
- XR0CSWV3h3kZWg 9y ago
  If you control 50 + epsilon percent of the hash power you can censor blocks at will. You can ignore every block that anyone else makes and still have the longest chain.
  - tboyd47 9y ago
    Except for the fact that they can still get confirmation from the other 50 - epsilon percent. Having 51% of hash power doesn't mean you mine 100% of blocks. That's not how Bitcoin works. With 51% you will probably mine around 51%.
    - Dylan16807 9y ago
      You're forgetting that every miner chooses how they mine. Someone with 51% hash power can decide to always mine on top of their previous block, ignoring what everyone else does. And because the 51% chain is longer, the 49% chain get discarded by any miner following default bitcoin rules. So the effective block rate gets slowed down, and the person with 51% of the power has control of 100% of the canonical blocks.
      - tboyd47 9y ago
        This would make the 51% miners' chain grow at half the speed as the 49% miners' chain, because the 49% are building on both their blocks and the other miners' blocks, whereas the 51% are only building on their blocks. This, of course, is assuming that the 51% doesn't create blocks considered invalid on the other chain. This would cause a hard fork and it's exactly what is happening now with Bitcoin Cash, except with a much smaller fraction than 51%. So no, what you are describing cannot happen with the default rules.
        Dylan16807 9y ago
        > the 49% are building on both their blocks and the other miners' blocks, whereas the 51% are only building on their blocks. They are building on some of their blocks and some of the other miner's blocks. This doesn't make them faster. Whenever a 49%er mines a block, there is a temporary fork. The 49% and the 51% start mining on two completely separate branches, both of which progress at half speed. Eventually the 51% branch is longer, and the 49% discard their previous work and switch to it. So the 49% were using their blocks, and now they are using the 51% blocks, but never both at the same time. The canonical blockchain does not progress at full speed. Half the blocks that get mined eventually become orphans. It would be impossible for the 49% to build on everyone's blocks, because the 51%-created blocks are always mutually incompatible preexisting 49%-created blocks. > This, of course, is assuming that the 51% doesn't create blocks considered invalid on the other chain. Yes, of course.
        tboyd47 9y ago
        If this were so then Bitcoin Cash would have been dead from the start. They hard forked with much less than 49% of hashpower. There are really two separate scenarios we're talking about here. Miner activated hard forks, which are a real thing that have happened (though not exactly like you describe), and a hypothetical situation where a group of miners agree to create an exclusive chain that is also backwards compatible. I'm no expert but I don't think that would have the intended result.
- freeloop2 9y ago
  You can effectively freeze anyone's funds by refusing any transactions that originate from their address

strgcmc 9y ago

Nothing "stopping" it, except the tens (hundreds?) of millions of dollars worth of hardware investment it would take before your new hashrate becomes at all competitive. It's a bit like saying there's nothing stopping you from launching your own soft drink and beating out Coca Cola (you could try, but you probably won't win). China has a huge and possibly insurmountable lead in not just existing built hardware, but a head start in the know-how of rolling out new ASIC designs to production, (relatively) cheap factories to mass-produce hardware, access to cheap/state-subsidized electricity, and (in this hypothetical scenario of nationalization) the support of the central government of one of the largest/most-powerful nations on Earth.

tboyd47 9y ago
Miners have very little power over Bitcoin as a whole. They are constrained both by Bitcoin's rules and economics. If they mine invalid blocks or optimize for something other than fees, the operation will turn unprofitable. If they just stop mining, the mining difficulty will adjust and suddenly ASICs will not be needed to turn a profit. There is a delicate balance in Bitcoin, currently tipped slightly in their favor, that they probably don't want to disrupt.
- imron 9y ago
  > Miners have very little power over Bitcoin as a whole. Chinese miners currently control significantly more than 50% of Bitcoin mining. If the government takes control of the the miners, they take control of the bitcoin network. There's plenty of mischief they could make with that if they were so inclined.
  - tboyd47 9y ago
    Your reply does not refute the point you quoted in any way, nor does it address the other points I made. You are merely restating what the other person said in an equally hand-wavy manner.
- XR0CSWV3h3kZWg 9y ago
  Miners obviously are okay taking a hit as there are plenty that are working on the less profitable BCH chain.

tannerbrockwell 9y ago

China will nationalize the domestic creation of Bitcoin. This is their sphere of influence. Thus they will control the domestic production of bitcoins. This nationalization will kick off the next leg up of the exponential growth for bitcoin. Just as the US Marshals auctioning off the Silk Road coins established legality in the American market. China will want to control capital flight and will use bitcoin as the release valve for their outrageously overhigh investment in US Treasuries.

tboyd47 9y ago
Bitcoins are not like some manufactured physical item where a group of people can collectively seize the means of production with force to control supply of said item. It would be kind of funny if the CCP views it that way but I doubt they do. They probably have more knowledge about how Bitcoin works than everybody on HN combined.
- tannerbrockwell 9y ago
  The miner's mining Rig's are plugged into the state controlled power grid. If China wants to control the means of production, they simply follow the power hogs, remember we're talking about operations that are industrial scale. The small players have 500+ mining rigs alone. The means of production will be seized. Existing coins are a toss-up. Although since the penalty could be a death sentence, I'm sure the business's that have these will comply with what ever orders follow.
  - tboyd47 9y ago
    You are still thinking about this in terms of a physical object. Miners don't "produce" anything except in the same sense that I "produce" the answer to a crossword puzzle. You can take away my pencil but it doesn't make the puzzle unsolvable.
    - tannerbrockwell 9y ago
      Dude. The mining rigs are physical. All I said was that China will seize the 'means of production' so they control the manufacture domestically. It's a phrase that was used a lot to describe the basic tenets of different types of economy and harkens to a time when industrialization was a major focus of the first world and people trying to find their place in an industrial society. The "means of production" phrase has been distilled and entered the zeitgeist as a way to talk about communism.