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I'd go a step further with the comparison to gold. If everyone would stop mining gold today, gold would retain value (or perhaps even go up in value). On the

I'd go a step further with the comparison to gold. If everyone would stop mining gold today, gold would retain value (or perhaps even go up in value). On the flipside, if we turned off all bitcoin miners today, bitcoin would go to zero instantly (as its worthless without continuous resources being pumped into it). This is why I'm sympathetic to those who say its ponzi scheme, it only has value because of new resources continuing to be poured into it.

P5fRxh5kUvp2th 4y ago
^ that was exactly my point and why I asked the other poster if they actually understood the point. but I'm in the middle of getting warned and moderated by dang for daring to ask such a question!
tim333 4y ago
Nitpicking but >if we turned off all bitcoin miners today, bitcoin would go to zero instantly isn't true. You couldn't trade them normally with the miners off but you could start mining up the day after - it only takes a couple of computers really.
- deleted 4y ago
  [deleted]
- feet 4y ago
  Turning mining back on is entirely changing the parent's statement. "Well yea you could do that change to tank the value, but imagine if you just undid it huh???" The point was without mining entirely, there is no value
  - Taniwha 4y ago
    But there's only ever going to be a fixed number of bitcoin - does it all just stop working when it's all mined out?
    - majewsky 4y ago
      Once all bitcoins are mined, miners are supposed to fund themselves solely through transaction fees, as they partially already do today.
    - feet 4y ago
      Iirc miners get the gas fees
    - Lerc 4y ago
      The mining reward is not supposed to be the end state of the system. It is a subsidy, reducing over time, to get the system established. Once established, the idea is that transaction fees are used and the distributed nature of the network causes a natural competition to be the most efficient so miners can charge the lowest fees while making a profit.
  - tim333 4y ago
    I guess it's a different scenario but if all the existing miners were turned off today, there is nothing to stop me running the open source bitcoin software on a spare computer myself the day after. I guess if you ban that for all time and all places bitcoin would be over.
    - feet 4y ago
      My impression of the intent of the statement was "disable mining altogether" not "turn off the existing physical mining rigs until someone turns one back on"
  - HN_is_for_gemes 4y ago
    And if you turned off all the electricity in the world a lot of companies would go bankrupt. What's the point? It's not going to happen.
- arcticbull 4y ago
  > You couldn't trade them normally with the miners off but you could start mining up the day after. So if we turn off all the bitcoin miners, it wouldn't be possible to transact. All you could do is look at it, like a read-only excel sheet.
  - mr_woozy 4y ago
  - snapcaster 4y ago
    But you understand why this hasn't happened yet right? if everyone else turned off their miners, I for one would be interested in money and turn one on
stephc_int13 4y ago
I've read elsewhere that below $13K it is not profitable to mine bitcoins. We're very close to this threshold now, given what is happening now and during the next few weeks I would not be surprised if BTC is going below that threshold. I think it's time to stash a few bottles of champagne.
- shawabawa3 4y ago
  The protocol self adjusts so that it's always profitable to mine bitcoins As it becomes unprofitable miners stop, and the difficulty drops so that it becomes cheaper to mine, until it reaches an equilibrium
  - stephc_int13 4y ago
    Is the difficulty dropping because miners are then racing against less miners, or is it a different mechanism?
    - Kranar 4y ago
      Different mechanism, Bitcoin's difficulty adjusts based on how quickly blocks are mined so that on average 1 block is mined every 10 minutes. The protocol adjusts every 2016 blocks, if it takes longer than two weeks (20160 minutes) to mine the 2016 blocks then the difficulty decreases, if it takes less than two weeks to mine 2016 blocks then the difficulty increases.
  - r1ch 4y ago
    The adjustment algorithm still requires blocks to be generated before it adjusts. If enough miners shut down at the same time, time between blocks will skyrocket, pushing the difficulty adjustment forward even further and crippling the transaction throughput.
- ahaseeb 4y ago
  It really depends from miners to miners. As effectively it's about how cheap your energy cost is. Since there's no transport cost, your cost is to acquire cheaper energy.
luddit3 4y ago
And if we turned off the internet how many companies would be worthless, because that is about as likely to happen as all mining stopping.
- themihai 4y ago
  What is crypto used for? Who uses/needs the crypto network for anything except speculation?
  - kayamon 4y ago
    People use Bitcoin to trade and send money around the world with each other.
    - ahaseeb 4y ago
      Issue is that the amount of people who ACTUALLY use is for money transfer without the speculation part is very lil. Probably less than 1%
    - themihai 4y ago
      Do you know anyone who does that unless there is a scam/fraud or illegal sale?
- acdha 4y ago
  Normal people would notice and agitate for the internet to be restored. Most people’s daily lives would be significantly impacted. In contrast, only speculators would notice bitcoin going offline. They might laugh at the guys who told them they weren’t going to make it but that’d be it. Nothing would break, nobody would be in line ahead of them failing to buy something, etc. That matters because bitcoin’s floor value is zero: as a very weak fiat currency, the only reason to use it is when you think it’ll be profitable and if that confidence drops miners will stop putting more hard money into the system.
  - HN_is_for_gemes 4y ago
Justsignedup 4y ago
I believe that's what we call a pyramid scheme. It only works as long as resources are being poured into it. The second the money flow stops, it instantly collapses.
golergka 4y ago
> If everyone would stop mining gold today, gold would retain value (or perhaps even go up in value). On the flipside, if we turned off all bitcoin miners today, bitcoin would go to zero instantly (as its worthless without continuous resources being pumped into it). "Mining" in bitcoin means two different things, creating new coins AND adding transactions to the ledger. If mining reward went to 0 (which will actually happen someday), and new coins stopped being created, miners would still be able get a profit from transaction fees, although it wouldn't be "mining" in the same sense as gold.
rhino369 4y ago
I think Bitcoin has no value. But I don't think mining issue you raise is a reason why. The difficulty of mining is pegged to size of the mining pool so you don't actually need that many miners to operate the whole network. Mining is bad for other reasons--it's a huge waste of resources when bitcoin is worth a lot of money.
Lerc 4y ago
>if we turned off all bitcoin miners today, bitcoin would go to zero instantly You talk about this like this is an easy action with profound consequences. It's like saying If everyone killed themselves, there would be no people. This is trivially true, but it's not going to happen. >(as its worthless without continuous resources being pumped into it). All forms of transaction has some form of resources put into it. The quantity of resources is what is at issue here. Bitcoin does not need the massive quantity of resources it currently uses to operate. That is an artifact of the high value of Bitcoin coupled with the subsidy of the mining reward. I'm not sure if the creator(s) of Bitcoin evaluated what kind of value a Bitcoin should have over time, The mining reward halving rate suggests that they were not expecting it to have a continual average rise above 20% per year (which makes sense because that would be insane). To date, however, it _has_ been averaging more than that, resulting in an increase in value of the mining reward relative to other currencies. Should the value drop or simply not increase for a extended period, the mining subsidy becomes less. Then only the most efficient miners can make money mining and the difficulty drops to a new equilibrium as the ones who can no longer make money drop out.

P5fRxh5kUvp2th 4y ago

^ that was exactly my point and why I asked the other poster if they actually understood the point. but I'm in the middle of getting warned and moderated by dang for daring to ask such a question!

tim333 4y ago

Nitpicking but >if we turned off all bitcoin miners today, bitcoin would go to zero instantly isn't true. You couldn't trade them normally with the miners off but you could start mining up the day after - it only takes a couple of computers really.

deleted 4y ago
[deleted]
feet 4y ago
Turning mining back on is entirely changing the parent's statement. "Well yea you could do that change to tank the value, but imagine if you just undid it huh???" The point was without mining entirely, there is no value
- Taniwha 4y ago
  But there's only ever going to be a fixed number of bitcoin - does it all just stop working when it's all mined out?
  - majewsky 4y ago
    Once all bitcoins are mined, miners are supposed to fund themselves solely through transaction fees, as they partially already do today.
  - feet 4y ago
    Iirc miners get the gas fees
  - Lerc 4y ago
    The mining reward is not supposed to be the end state of the system. It is a subsidy, reducing over time, to get the system established. Once established, the idea is that transaction fees are used and the distributed nature of the network causes a natural competition to be the most efficient so miners can charge the lowest fees while making a profit.
- tim333 4y ago
  I guess it's a different scenario but if all the existing miners were turned off today, there is nothing to stop me running the open source bitcoin software on a spare computer myself the day after. I guess if you ban that for all time and all places bitcoin would be over.
  - feet 4y ago
    My impression of the intent of the statement was "disable mining altogether" not "turn off the existing physical mining rigs until someone turns one back on"
- HN_is_for_gemes 4y ago
  And if you turned off all the electricity in the world a lot of companies would go bankrupt. What's the point? It's not going to happen.
arcticbull 4y ago
> You couldn't trade them normally with the miners off but you could start mining up the day after. So if we turn off all the bitcoin miners, it wouldn't be possible to transact. All you could do is look at it, like a read-only excel sheet.
- mr_woozy 4y ago
- snapcaster 4y ago
  But you understand why this hasn't happened yet right? if everyone else turned off their miners, I for one would be interested in money and turn one on

stephc_int13 4y ago

I've read elsewhere that below $13K it is not profitable to mine bitcoins. We're very close to this threshold now, given what is happening now and during the next few weeks I would not be surprised if BTC is going below that threshold. I think it's time to stash a few bottles of champagne.

shawabawa3 4y ago
The protocol self adjusts so that it's always profitable to mine bitcoins As it becomes unprofitable miners stop, and the difficulty drops so that it becomes cheaper to mine, until it reaches an equilibrium
- stephc_int13 4y ago
  Is the difficulty dropping because miners are then racing against less miners, or is it a different mechanism?
  - Kranar 4y ago
    Different mechanism, Bitcoin's difficulty adjusts based on how quickly blocks are mined so that on average 1 block is mined every 10 minutes. The protocol adjusts every 2016 blocks, if it takes longer than two weeks (20160 minutes) to mine the 2016 blocks then the difficulty decreases, if it takes less than two weeks to mine 2016 blocks then the difficulty increases.
- r1ch 4y ago
  The adjustment algorithm still requires blocks to be generated before it adjusts. If enough miners shut down at the same time, time between blocks will skyrocket, pushing the difficulty adjustment forward even further and crippling the transaction throughput.
ahaseeb 4y ago
It really depends from miners to miners. As effectively it's about how cheap your energy cost is. Since there's no transport cost, your cost is to acquire cheaper energy.

luddit3 4y ago

And if we turned off the internet how many companies would be worthless, because that is about as likely to happen as all mining stopping.

themihai 4y ago
What is crypto used for? Who uses/needs the crypto network for anything except speculation?
- kayamon 4y ago
  People use Bitcoin to trade and send money around the world with each other.
  - ahaseeb 4y ago
    Issue is that the amount of people who ACTUALLY use is for money transfer without the speculation part is very lil. Probably less than 1%
  - themihai 4y ago
    Do you know anyone who does that unless there is a scam/fraud or illegal sale?
acdha 4y ago
Normal people would notice and agitate for the internet to be restored. Most people’s daily lives would be significantly impacted. In contrast, only speculators would notice bitcoin going offline. They might laugh at the guys who told them they weren’t going to make it but that’d be it. Nothing would break, nobody would be in line ahead of them failing to buy something, etc. That matters because bitcoin’s floor value is zero: as a very weak fiat currency, the only reason to use it is when you think it’ll be profitable and if that confidence drops miners will stop putting more hard money into the system.
- HN_is_for_gemes 4y ago

Justsignedup 4y ago

I believe that's what we call a pyramid scheme. It only works as long as resources are being poured into it. The second the money flow stops, it instantly collapses.

golergka 4y ago

> If everyone would stop mining gold today, gold would retain value (or perhaps even go up in value). On the flipside, if we turned off all bitcoin miners today, bitcoin would go to zero instantly (as its worthless without continuous resources being pumped into it). "Mining" in bitcoin means two different things, creating new coins AND adding transactions to the ledger. If mining reward went to 0 (which will actually happen someday), and new coins stopped being created, miners would still be able get a profit from transaction fees, although it wouldn't be "mining" in the same sense as gold.

rhino369 4y ago

I think Bitcoin has no value. But I don't think mining issue you raise is a reason why. The difficulty of mining is pegged to size of the mining pool so you don't actually need that many miners to operate the whole network. Mining is bad for other reasons--it's a huge waste of resources when bitcoin is worth a lot of money.

Lerc 4y ago

>if we turned off all bitcoin miners today, bitcoin would go to zero instantly You talk about this like this is an easy action with profound consequences. It's like saying If everyone killed themselves, there would be no people. This is trivially true, but it's not going to happen. >(as its worthless without continuous resources being pumped into it). All forms of transaction has some form of resources put into it. The quantity of resources is what is at issue here. Bitcoin does not need the massive quantity of resources it currently uses to operate. That is an artifact of the high value of Bitcoin coupled with the subsidy of the mining reward. I'm not sure if the creator(s) of Bitcoin evaluated what kind of value a Bitcoin should have over time, The mining reward halving rate suggests that they were not expecting it to have a continual average rise above 20% per year (which makes sense because that would be insane). To date, however, it _has_ been averaging more than that, resulting in an increase in value of the mining reward relative to other currencies. Should the value drop or simply not increase for a extended period, the mining subsidy becomes less. Then only the most efficient miners can make money mining and the difficulty drops to a new equilibrium as the ones who can no longer make money drop out.