3 ms·
Here is a thought experiment : Say the pool operator is also the owner of Bank A (which has nothing to do with BTC). Now, a competitor of Bank A, Bank B, just
by jre 13y ago
Here is a thought experiment :
Say the pool operator is also the owner of Bank A (which has nothing to do with BTC). Now, a competitor of Bank A, Bank B, just announced that they will support BTC. The pool operator can now decide to "destroy" bitcoin and therefore cause severe financial loss for Bank B, leading to bankruptcy. If putting Bank B out of business results in gains (in USD), for the pool operator, that are greater than what he just lost in bitcoins, then it might be worth it.
Of course, this is very hypothetical, but it's not hard to come up with similar situations where Bank A is "State A" and Bank B is "State B".
- jobeirne 13y agoThanks for the concrete counterexample. I still find it dubious that the owner of Bank A would be willing to destroy a stream of income as considerable as a 51% stake in BTC just to preempt a competitor in another market. That seems too self-sacrificial to be practical. Also, you're missing the point that Bank B's successful adoption of BTC would also benefit Bank A's owner, since that adoption would be a boon for BTC, which Bank A owner has a very large stake in.
- msandford 13y agoIt's all a matter of the right price. Bank A doesn't own 51% of bitcoin, it has control over 51% of the mining pool. As a rational agent in the bitcoin-only world that's worth SOMETHING but not billions. As a rational agent in the total world it might be worth sacrificing $100mm on the pool if it can cost your competitor $10b.
- jre 13y agoGood points. What I wanted to point out is that the typical arguments about an agent's incentives to not destroy BTC usually fail to take into account gains outside of the BTC world.