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Comment by basicplus2 | Hacker News Reader

So what happens when the entire earth's energy production is required to produce the next bitcoin and there is therefore no further bitcoin mining?

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The price of energy would gradually increase, to the point is no longer feasible to mine bitcoin with it. That's how markets work: the higher the demand, the higher the price, to the point where demand meets availability*cost.

It should be noted that Bitcoin doesn't actually need much energy to process the transactions; I believe you could run the whole thing in a single computer. It only burns a lot of energy to avoid malicious miners from subverting the process. More mining means more energy must be burnt, but it can be scaled up or down, and doesn't affect the transaction rate.

So a takeover by a UN mandated operation then, to put it under the trusted oversight of a bank? :)

This cannot happen. Bitcoin difficulty adjusts to match current mining power so it can't get out of control like that.

So why does it take so long to make a transaction these days? Is the difficulty scaling outpacing the actual network?

As I understand it the transaction throughput is limited by the block size. The difficulty adjusts so the rate at which blocks can be mined remains roughly constant, but each block is size limited so it can only contain so many transactions.

Yes. Correct me if I'm wrong, but I think it's like a regular bus service to a desirable destination. 40 seats every few minutes. Highest fares at any given moment get a ride. But if there are hundreds of people wanting to go, those willing to pay peanuts get left waiting.

The purpose of this restriction is to protect the decentralization of bitcoin nodes. It is this decentralization of nodes that separates bitcoin from every other crypto competitor, and by some margin.

I'm not really sure how a small block size prevents centralisation?

An increase in blocksize means an increase in propagation delay. Too much delay and miners who are closest to the most recent block get a head start mining the next block. Mining is suppose to be a lottery, not a race.

Research done on the matter shows that for each kb above the current 1mb block, 80ms of delay propagation is added.

Couldn't/Wouldn't the difficulty be adjusted down in that case so the blocks are mined faster?

Purely because there are more people wanting to make transactions. The speed of the network is always ~10 minutes per block.

Bitcoin is limited at 21 million coins. After that, no more btc, and people will trade in btc divisions such as satoshis. But there are hundrerds of bitcoin alternatives now, some very interesting.

If there's no more miners / mining, who verifies the transactions? (iirc that's what miners did, but correct me if I'm wrong and miners only generate currency and don't verify transactions)

There is no more BTC created after 21 million coins, but the mining continues. This just means that each block no longer comes with a fixed reward, but the miners will still make money from transaction fees.

As far as I understand, the process of mining is verifying the transactions as well. The miners are generating bitcoin as part of the process of verifying the transactions. After the 21 mil limit is hit, they will be rewarded from the transaction fees. (Someone with more in depth knowledge feel free to correct me if I am wrong).

You're not wrong. They currently get the block reward and the transaction fees. When there's no more reward to be had they will get just the transaction fees.

They do verify transactions, and are incentivized to do so by transaction fees

They don't verify transactions actually. That is what nodes do. They retrieve valid transactions from nodes, order them, and then hash them according to the consensus proof-of-work algorithm, which in this case, is SHA-256, until it produces a block that will satisfy the node consensus requirements.

Miners are nodes and therefore verifying transactions, and they're the only nodes writing transactions to the blockchain.

Non-mining nodes can only verify transactions for themselves , which helps them stay on the chain of their choice but does not extend any chain.

Miners require nodes, so they have them too, because without nodes they can't source transactions. Every node, applying consensus rules, extends the blockchain by accepting valid blocks that meet consensus rules.

We have had a year long education in the limited power of miners with many people incorrectly attributing responsibility for maintaining the protocol. Miners were rightly shown to be powerless to force consensus changes on the nodes. When push came to shove they did what they were told, at the threat of being crushed with a pow change.

Only a convention. Participants can fork / change the algorithm easily.

Which are the most interesting ones?

There is no such thing as "most interesting", it depends on what you look for (technical quality, investment, compatibility, etc), what you need (bleeding edge, stability, doc, popularity...). Plus it's hard to assess innovation, some coins may very well be genius and we are not visionary enough to know.

Some characteristics to look for:

- ASIC resistance. Some currencies make sure you can't just throw money at GPU and become the king of the hill like with Bitcoin. E.G: Vivo, VTC, XMR.

- CPU friendly. Some currencies can be mined on CPU, not just GPU. It makes it interesting for embedding in web pages or viruses. E.G: Monero, Aeon, etc.

- Privacy focused. Some currencies make it hard to know where does the money comes from and goes to. E.G: Monero, Zcash and co.

- Smart contracts. Some currencies are not just money, but gigantic programmable public databases. Ethereum being to smart contracts what bitcoin is to cryptocurrengies in general.

- Master nodes. Some currencies provide very fast transactions by featuring nodes responsible to pre-validate them. E.G: Vivo, Dash.

- Community. You may want big name supports (Bitcoin, Ripple), great tooling (Ethereum, Monero). You should check if your exchange deal with the currency your target.

Personally I like:

- Vivo. The team is close to home. The master nodes give me great rewards and I help friends and family to setup theirs, for a fee. Best investment to date, appart from BTC. But only cryptopia deals with them which make it hard to trade.

- Monero. Simple to mine, and nobody knows what I do. But a bad rep because of the viruses.

- Ethereum: it's the most stable currency IMO, because of all the ecosystem, it's not gonna die. Also awesome team. Very little downside to this one.

- Ripple: big names trying to do official things. I'm curious of the result. But it's premined.

Sometime I feel like I should stop writing blogs post about Python and be paid as a full time crypto explainer, cause it's like I answer the same questions every day.

Anyway, good luck. And don't believe any people telling you they perfectly understand this market, because it's the most irrational one I ever seen. It's unstable. It's exploding. It's crazy. And so fun. Until you loose everything :)

> ASIC resistance ... make sure you can't just throw money at GPU and become the king of the hill; CPU friendly

first of all, asics are specially designed hardware, not gpus

second, switching to actual gpu- or cpu- friendly algorithm comes with it's own drawbacks - anybody controlling large enough botnet can perpetrate 51% attack against you

Existing bitcoin stock will just split into smaller parts (= the BTC price goes up further and trading happens in smaller fractions).

If the network however becomes so bogged down that transactions take weeks, I'm fairly sure people will gravitate towards some of the other currencies; hopefully this is a gradual process, and the BTC price won't be affected too much / too directly.

My understanding is that if enough people stop mining the difficulty will be lowered so that the energy costs fall. Also there are transaction fees.

Lightning Network significantly reduces transaction revenue, so there will be dramatically fewer miners.

I don't think there will fewer miners. I think it's more likely that the price of Bitcoin would increase.

There a lot of very large mining operations that cannot afford to scale down, and they won't sell their mined Bitcoin at a loss. If there are fewer transaction fees, this smaller amount of BTC would have to pay for all of the electricity that was used to mine a block.

Maybe everything would change if the mining operations started to run their own power plants that use free and renewable energy. They could buy some land next to a river and set up a hydroelectric power generator. That would just be a capital cost, and if you do it right, then it could cost very little to maintain. The operational cost would be maintenance, the internet bill, and fixing/replacing broken miners. Even if the mining doesn't work out, I've just been reading about some people who do this and sell excess power to their power company.

The price will not be able to increase to the point that the mining block bitcoin reward itself will incentivize miners. As the mining block reward approaches zero, transaction fees will be the only way to incentivize miners. Since there will be fewer transactions, transactions won't have to provide a large fee just in order to get the transaction in the next block. The reduced transaction revenue will cause many miners to leave the network. Fewer miners will mean easier difficulty. This phenomenon stabilizes when mining is still profitable at the lower transaction revenue level.

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