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The difference between your first two examples and the final one is that Bitcoin is decentralized. It only takes a single miner to keep the Bitcoin network func

by ve55 9y ago

The difference between your first two examples and the final one is that Bitcoin is decentralized. It only takes a single miner to keep the Bitcoin network functioning (in practice you'd need to wait for difficulty adjustment and it wouldn't work out very well, but the point is you don't need to rely on any single entity not going bankrupt). It's true that is the price goes low enough mining would decrease significantly, but after difficulty adjustment it would still exist to a nonzero extent. Bitcoin can absolutely still function as a system even if 95% or even 99% of all miners end up quitting it over the next few years.

astrodust 9y ago
BitTorrent is truly decentralized. So long as there's one seed of something you can repopulate the network, you can rebuild from that singular copy. Even N partial copies could do it so long as the sum of all those parts is at least one complete copy. This is because all you care about is data, and data can be copied easily. Bitcoin isn't. It's merely distributed and it depends on having a singular, healthy, functioning consensus network. Where that network splits you suddenly have more than one blockchain, as is the case with Bitcoin Gold, and Bitcoin Cash. It also depends on having a healthy balance of mining power in that network so that no one entity can take control and start to dictate terms. If all that's left is a single miner then four other miners can easily take charge of that network and effectively destroy it. > Bitcoin can absolutely still function.... The blockchain component of Bitcoin can technically function, sure, there's no problem there, but as a unit of value, as a unit of exchange, it's functionally useless. You can't trust it, you can't use it for anything. There is, by design, one blockchain. When that assumption fails, the network has to work to achieve consensus, and if that can't be achieved it splits. That can be fine with things like IRC networks or peer-to-peer exchanges, you can always do a messy reconciliation later, but with something that's supposed to represent a medium of exchange that's a problem.

by ve55 9y ago

astrodust 9y ago

BitTorrent is truly decentralized. So long as there's one seed of something you can repopulate the network, you can rebuild from that singular copy. Even N partial copies could do it so long as the sum of all those parts is at least one complete copy. This is because all you care about is data, and data can be copied easily. Bitcoin isn't. It's merely distributed and it depends on having a singular, healthy, functioning consensus network. Where that network splits you suddenly have more than one blockchain, as is the case with Bitcoin Gold, and Bitcoin Cash. It also depends on having a healthy balance of mining power in that network so that no one entity can take control and start to dictate terms. If all that's left is a single miner then four other miners can easily take charge of that network and effectively destroy it. > Bitcoin can absolutely still function.... The blockchain component of Bitcoin can technically function, sure, there's no problem there, but as a unit of value, as a unit of exchange, it's functionally useless. You can't trust it, you can't use it for anything. There is, by design, one blockchain. When that assumption fails, the network has to work to achieve consensus, and if that can't be achieved it splits. That can be fine with things like IRC networks or peer-to-peer exchanges, you can always do a messy reconciliation later, but with something that's supposed to represent a medium of exchange that's a problem.