Bitcoin is close to becoming worthless
marketwatch.com
marketwatch.com
Anyone who needs a hand getting rid of any unwanted (and now 'close to worthless' bitcoins) can send them to my disposal facility:
bitcoin:1GCEvj54xSr3Hu1DPg2GKw2VkDgSaX5SB7
Not many incoming transactions? I guess not many users think they're worthless afterall...
wouldn't that mean the price should hover around the cost to replace?
Fewer miners mean difficulty will adjust downward and those still mining will have a higher probability of getting the block reward.
>However, the number of miners cannot fall below a certain level, because without the miners providing the computing power to maintain the ledger, the bitcoin blockchain will not remain viable.
That's not actually correct. The difficulty of mining can drop to basically zero. The entire throughput of bitcoin as it stands today could be calculated on a single 2005 era cellphone if the difficulty dropped far enough, which it would if enough miners left the network.
Of course, if there was only one single 2005 era cellphone running, someone malicious could online /two/ 2005 era cellphones and then use their majority share of the network to start double-spending, so you do want enough compute power that it's not trivial for a single actor to beat it out.
There is an interesting lower threshold on mining difficulty that we haven't hit yet, and that's the point where GPU mining becomes viable again. There's quite a lot of small-time GPU rigs out there that have been mining some of the more interesting altcoins like monero and etherium that could switch over to bitcoin if enough asic miners leave the network.
So I'm not convinced on the authors "critical tipping point" thesis. There's a potential floor there he doesn't seem to be aware of.
https://www.blockchain.com/en/charts/hash-rate?timespan=all&...
This is similar to what happened with the creation of the Bitcoin Cash fork. Just after the fork, the hash rate in the Bitcoin Cash was 1/10 of the previous rate, so each block would need like 2 hours instead of the usual 10 minutes. They expected something like this, so in the fork they added an special rule to reduce the difficulty automatically if no one finds a block for a long time. (This rule is not in the main Bitcoin.)
That's always been a weakness in the difficulty recalculation algorithm. There are a few other ones out there that can do much faster re-targeting in interesting ways, such as gravity well[1]. I'm assuming that if we faced a sudden exodus of that scale that dramatically wedged block generation, we'd see a hard-fork to change the recalculation algorithm. The hard-fork would certainly win because anyone who refuses the hard-fork can't mine blocks due to the difficulty being too high for the network.
[1] https://bitcoin.stackexchange.com/questions/21730/how-does-t...