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I'm still a little surprised this was necessary. Miner income depends on the price of Bitcoin. Therefore, miners have a self-interest to protect the integrity

I'm still a little surprised this was necessary. Miner income depends on the price of Bitcoin. Therefore, miners have a self-interest to protect the integrity of the network. It isn't like there are no alternatives to Ghash.io. It looks they collectively voted that this wouldn't be a big deal, or it would get sorted out by other mechanics (like this), and they were right. It hasn't seemed to significantly effect the price of Bitcoin.

sp332 12y ago
Ghash.io makes money from hosted mining, and takes no mining fees from the pool. So some miners in the pool might go elsewhere (and pay mining fees) for those reasons, but it looks like lots of people are just hoping that someone else will leave.
- sliverstorm 12y ago
  it looks like lots of people are just hoping that someone else will leave. Yup. Hello, tragedy of the commons. Albeit in a slightly different form from normal.
  - zheshishei 12y ago
    In this case, it's more like the Bystander Effect[1], which is related to the tragedy of the commons. Both can be the result of what's called the "Diffusion of Responsibility" [2]. Specifically, the game model this is following is the Volunteer's Dilemma [3]. [1] http://en.wikipedia.org/wiki/Bystander_effect http://en.wikipedia.org/wiki/Bystander_effect [2] http://en.wikipedia.org/wiki/Diffusion_of_responsibility http://en.wikipedia.org/wiki/Diffusion_of_responsibility [3] http://en.wikipedia.org/wiki/Volunteer's_dilemma http://en.wikipedia.org/wiki/Volunteer's_dilemma
- cottonseed 12y ago
  I didn't realize that about Ghash. Are there other zero-fee pools? Why wouldn't Ghash raise their rates? Their pool shrinks and they make more money. What's the advantage of the current setup?
- baddox 12y ago
  The economic question is whether Ghash.io will make more money by staying legitimate or by attacking the network. They might be able to get a nice one-time payout with an attack (although even that's debatable), but I suspect that it would be more profitable to provide the legitimate service. It's the same reason why most bars don't take your drink order and money and then refuse to give you the drink. Obviously, in isolation it would be more profitable to take the money then refuse to give the drink. It's illegal, but you're unlikely to sue because of the cost of litigation. The reason the bar gives you the drink isn't that they want to sacrifice their profits just to make you happy, and it's not that they fear litigation. The reason is that it's more profitable in the big picture for them to give you the drink, because people don't tend to visit bars if they hear that the bartenders take money and don't give drinks in return.

sp332 12y ago

Ghash.io makes money from hosted mining, and takes no mining fees from the pool. So some miners in the pool might go elsewhere (and pay mining fees) for those reasons, but it looks like lots of people are just hoping that someone else will leave.

sliverstorm 12y ago
it looks like lots of people are just hoping that someone else will leave. Yup. Hello, tragedy of the commons. Albeit in a slightly different form from normal.
- zheshishei 12y ago
  In this case, it's more like the Bystander Effect[1], which is related to the tragedy of the commons. Both can be the result of what's called the "Diffusion of Responsibility" [2]. Specifically, the game model this is following is the Volunteer's Dilemma [3]. [1] http://en.wikipedia.org/wiki/Bystander_effect http://en.wikipedia.org/wiki/Bystander_effect [2] http://en.wikipedia.org/wiki/Diffusion_of_responsibility http://en.wikipedia.org/wiki/Diffusion_of_responsibility [3] http://en.wikipedia.org/wiki/Volunteer's_dilemma http://en.wikipedia.org/wiki/Volunteer's_dilemma
cottonseed 12y ago
I didn't realize that about Ghash. Are there other zero-fee pools? Why wouldn't Ghash raise their rates? Their pool shrinks and they make more money. What's the advantage of the current setup?
baddox 12y ago
The economic question is whether Ghash.io will make more money by staying legitimate or by attacking the network. They might be able to get a nice one-time payout with an attack (although even that's debatable), but I suspect that it would be more profitable to provide the legitimate service. It's the same reason why most bars don't take your drink order and money and then refuse to give you the drink. Obviously, in isolation it would be more profitable to take the money then refuse to give the drink. It's illegal, but you're unlikely to sue because of the cost of litigation. The reason the bar gives you the drink isn't that they want to sacrifice their profits just to make you happy, and it's not that they fear litigation. The reason is that it's more profitable in the big picture for them to give you the drink, because people don't tend to visit bars if they hear that the bartenders take money and don't give drinks in return.