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After the last Bitcoin is mined (and actually much sooner than that), the profit from mining will have shifted away from new coins and into transaction fees. M

by ef4 14y ago

After the last Bitcoin is mined (and actually much sooner than that), the profit from mining will have shifted away from new coins and into transaction fees. Mining new coins and processing transactions are the same thing. So the hardware can remain useful as long as Bitcoin stays in use. (Could it get obsoleted by better hardware? Of course, but that's true of every piece of electronics.)

anigbrowl 14y ago
I guess what I am confused by is that the transaction processing is much easier than mining (ie it's not going to get more and more difficult to do do over time) so you'd need to be processing a very large number of transactions before you'd need an ASIC. If you're a bank or BTC exchange then it's a no-brainer, but I wonder if more than a small number of these devices will be able to do enough work to justify their power consumption as time goes by.
- lenazegher 14y ago
  >I guess what I am confused by is that the transaction processing is much easier than mining (ie it's not going to get more and more difficult to do do over time) Are you sure this is true? My understanding is that the proof-of-work requirements will be the same even after no new coins can be mined. Otherwise, the integrity of bitcoin would be threatened.
- maxerickson 14y ago
  By easier, do you mean less competitive? The transaction fees are won in the same fashion as the mining rewards, so given a high enough level of paying users there should be incentive to run nodes (the transaction fees might even overtake the mining rewards before the last new coins are awarded, if things play out in a bitcoin friendly manner).
  - anigbrowl 14y ago
    But if you are mining, there are fewer and fewer new coins to be discovered over time, so you have to compute more and more hashes in hopes of finding a new one. My (possibly incorrect) understanding is that processing a transaction 1 year from now will be no more difficult than processing one today, whereas in the future you'll have to mine for longer to have the same chance of getting a BTC. In other words, doesn't the workload for processing each transaction stay the same over time?
    - maxerickson 14y ago
      Yeah, actually adding a transaction to a block is trivial. But that block still has to be added to the block chain, which is exactly what mining is.
pbhjpbhj 14y ago
I don't know enough about the system but is it also possible to mine for "lost" coins? So someone started out mining and their wallet was corrupted or their hard-drive failed or what-have-you but at the time BTC were worth a few ¢. Is it possible to cryptographically reclaim those lost coins by claiming to have a hash or something and seeing if it verifies? Could one test, like a brute force check, in a separate environment so as not to leak that you're trying to reclaim a coin. Or is this impossible within the restraints of the system. [I can't see how it can be mathematically impossible, if a coin was verified and placed in a wallet then there's some "code" that says "I have the wallet with that coin"; perhaps though it's impossible at present to mine for that code successfully in a worthwhile way??]
- shawabawa3 14y ago
  It's impossible to reclaim coins. You would have to guess the private key that secures them, and if that was possible bitcoin would be useless. However, I guess it's possible for the network to agree to mine some new coins at some point in the future.
  - pbhjpbhj 14y ago
    So not impossible, you _just_ have to guess the owners private key? Presumably you could in theory brute force that in a million years or whatever. Also if there were an example of data encrypted with that key (is there in the block chain by virtue of the protocol?) then if the private key system were broken - eg by advance in quantum computing or a weakness found in the crypto used - then perhaps it would then be feasible. The corollary of this appears to be that you'd then be able to take anyone's bitcoins?
    - shawabawa3 14y ago
      > So not impossible, you _just_ have to guess the owners private key? Yes, by impossible I meant computationally infeasible (at the moment) > The corollary of this appears to be that you'd then be able to take anyone's bitcoins? Yes, there's no way of recovering long abandoned coins (e.g. the genesis block coins) that couldn't be used to steal newly minted coins

by ef4 14y ago

anigbrowl 14y ago

I guess what I am confused by is that the transaction processing is much easier than mining (ie it's not going to get more and more difficult to do do over time) so you'd need to be processing a very large number of transactions before you'd need an ASIC. If you're a bank or BTC exchange then it's a no-brainer, but I wonder if more than a small number of these devices will be able to do enough work to justify their power consumption as time goes by.

lenazegher 14y ago
>I guess what I am confused by is that the transaction processing is much easier than mining (ie it's not going to get more and more difficult to do do over time) Are you sure this is true? My understanding is that the proof-of-work requirements will be the same even after no new coins can be mined. Otherwise, the integrity of bitcoin would be threatened.
maxerickson 14y ago
By easier, do you mean less competitive? The transaction fees are won in the same fashion as the mining rewards, so given a high enough level of paying users there should be incentive to run nodes (the transaction fees might even overtake the mining rewards before the last new coins are awarded, if things play out in a bitcoin friendly manner).
- anigbrowl 14y ago
  But if you are mining, there are fewer and fewer new coins to be discovered over time, so you have to compute more and more hashes in hopes of finding a new one. My (possibly incorrect) understanding is that processing a transaction 1 year from now will be no more difficult than processing one today, whereas in the future you'll have to mine for longer to have the same chance of getting a BTC. In other words, doesn't the workload for processing each transaction stay the same over time?
  - maxerickson 14y ago
    Yeah, actually adding a transaction to a block is trivial. But that block still has to be added to the block chain, which is exactly what mining is.

pbhjpbhj 14y ago

I don't know enough about the system but is it also possible to mine for "lost" coins? So someone started out mining and their wallet was corrupted or their hard-drive failed or what-have-you but at the time BTC were worth a few ¢. Is it possible to cryptographically reclaim those lost coins by claiming to have a hash or something and seeing if it verifies? Could one test, like a brute force check, in a separate environment so as not to leak that you're trying to reclaim a coin. Or is this impossible within the restraints of the system. [I can't see how it can be mathematically impossible, if a coin was verified and placed in a wallet then there's some "code" that says "I have the wallet with that coin"; perhaps though it's impossible at present to mine for that code successfully in a worthwhile way??]

shawabawa3 14y ago
It's impossible to reclaim coins. You would have to guess the private key that secures them, and if that was possible bitcoin would be useless. However, I guess it's possible for the network to agree to mine some new coins at some point in the future.
- pbhjpbhj 14y ago
  So not impossible, you _just_ have to guess the owners private key? Presumably you could in theory brute force that in a million years or whatever. Also if there were an example of data encrypted with that key (is there in the block chain by virtue of the protocol?) then if the private key system were broken - eg by advance in quantum computing or a weakness found in the crypto used - then perhaps it would then be feasible. The corollary of this appears to be that you'd then be able to take anyone's bitcoins?
  - shawabawa3 14y ago
    > So not impossible, you _just_ have to guess the owners private key? Yes, by impossible I meant computationally infeasible (at the moment) > The corollary of this appears to be that you'd then be able to take anyone's bitcoins? Yes, there's no way of recovering long abandoned coins (e.g. the genesis block coins) that couldn't be used to steal newly minted coins