So, the much-vaunted "mathematical guarantee" that only 21m BTC will ever be mined depends on the benevolence of those 50 miners not to fiddle with the code base. Makes perfect sense to trust those honourable individuals more than the central bankers in control of fiat. /s
That is not the issue caused by this concentration of mining power.
There's no telling whether it'd be the "hijacked" branch or the original one - assuming they control 50%+ of the mining power, there's a decent argument that the remaining miners would follow their lead if only to stay on the largest branch.
Usually forks have checkpoints as well so things can't change willy-nilly.
There is a protocol and system specification. There are implementations of that specifications. There is a distributed system running those implementations. And the distributed system has a state. Each of those can change and each of those or a combination of them could arguably be called Bitcoin.
If everyone would run new implementations with a different coin cap, you can argue that it is no longer Bitcoin because Bitcoin is a very specific specification with a 21M coin cap, but this would have little bearing on the actual situation.
Yes, these 100 miners are pools. But where pool participants will go then? Will pools who have not forked keep pool participation fees low?
Etc.
The game here is not quite simple. It is much more complex than appears at first sight.
Here’s a graph of the time blocks took over the last three years:
https://bitinfocharts.com/comparison/bitcoin-confirmationtim...
Look at the peaks and try to remember the issues that resulted in.
Second, instead of two weeks to hash rate adjustment, it will take four weeks.
And if these staying with this slow bitcoin would decide to leave to more profitable currencies (not necessarily Bitcoin, there are other SHA256-based PoW schemes), that will push hash rate adjustment even further into future.
https://www.cnbc.com/2021/07/03/bitcoin-mining-difficulty-dr...
We survived.
Money has worth because people accept it in exchange for goods and services.
Bitcoin has worth because people accept it in exchange for goods and services.
It’s not the miners that create value, it’s the merchants. If miners start some fork they’ll leave the main blockchain, which will run fine without them. And they have absolutely no way of forcing anyone to use their fork. Only if the merchants start accepting coins from the forked blockchain will it become valuable. But that’s up to the merchants, not the miners.
There are problems with one miner controlling over 50% of the mining power. This is not such a problem.
It's been quite educational watching the whole cryptocurrency community re-invent economics 101 and find out the problem has never been technical, always been political.
This is less a criticism towards you @CompuHacker and more about how ill-informed reporters are (especially it's most vocal critics) about Bitcoin's history.
We already went through this during the USAF/Segwit war that went on for far too long if you were there and delayed so many other key features that we are only now catching up to. With the added caveat that Roger Veer (a VERY ignorant whale with influencer status) and Jihan (CEO at the time of Bitmain with a monopoly on ASIC miners and large hashing power on the network) decided to hi-jack Bitcoin for their own ends. There were other whales/high net worth entities, including Coinbase, but lets keep it simple for arguments sake.
In short, it didn't work and no one uses/used their fork (Bcash) because the end result was that Bitcoin's mainchain and it's features was valued far more than what whales and hashing power/devices. Furthermore, upon the fork people arbitraged the coin and dumped it in exchange for Bitcoin and Bcash has never recovered since. Showing that playing by the rules has it's incentives and is rewarded: rewarding consensus is one of Bitcoin's core features, and I wish more people would realize this is the ecosystem is far more conducive toward progress than abject discord.
What's even more amusing is that a core developer of Bitcoin Core decided to help patch some of Bcash's source code, showing that what you fear has actually already played out and proved why Bitcoin has already proven itself and has a the battle scars to prove it.
It's remarkable what has happened in this space in the last 12 years, and in my ideal World I think their would be more time spent on that and what it has taught us via empirical experimentation rather than just the price.
Sidenote: It's why the plot of the 51% attack on the series Silicon Valley only made sense to people who really have no idea how the network attack would actually play out on decentralized networks.
What mechanisms do those 50 miners have to coordinate amongst each other, starting with how do they identify each other, communicate with each other, then overcome Prisoner's Dilemma in negotiating with each other?
Therefore, over a long enough time scale, the number of available BTC tends towards zero.
Currently, you can only chop them up into atoms worth 1e-8 BTC (satoshis), but there isn't much that needs be changed in the code and the protocol to get that to much finer grained.
Therefore, it's unlikely that there will ever be zero bitcoins.
Such a change would be a hard fork and, as you know, we don't do that in Bitcoin. But, no worries because we have millisatoshis in Lightning. Because Bitcoin scales in layers, each layer can implement more and more divisibility as required.
https://bitcoin.stackexchange.com/a/69704
As you said, bitcoin is infinitely divisible, therefore the world economy can run on 1 btc or 1 satoshi.
True, it'd be a hard fork. However, I don't believe hard forks are impossible if managed properly.
The taproot upgrade (not a hard fork, I know) was rather uncontroversial and accepted rather easily.
I suspect a hard fork allowing for - say - bitcoin amounts encoded in 64 bits would not necessarily generate the kind of upheaval the blocksize wars did.
And, hopefully, even for controversial upgrades, the lessons of said wars will have been learnt and the process of upgrading Bitcoin can be done in a slightly more reasonable / orderly fashion.
In a world where only 1,000,000 BTC remain in circulation if one person owns 500,000 of them means he controls half of the total value of BTC and that everyone else's coins will add up to the other 500,000 BTC, and being able to divide the each BTC into smaller and smaller amounts doesn't change that fact. Whether we can divide 500,000 BTC into 50 trillion Satoshis or 5 quadrillion "New Satoshis" worth 1e-10 BTC each doesn't make new wealth appear.
https://www.investopedia.com/terms/d/deflationary-spiral.asp
Also, it exacerbates inequality immensely. When deflation is high, it means your existing money becomes more and more valuable for no other reason than existing. So the "rich get richer" in the most literal sense, for no other reason than having been rich in the first place. No investment or risk required.
Miners can't change the protocol of the entire network.
The only malevolent thing they could do is perform a 51% attack if they all colluded together. And even that wouldn't achieve much, so there's not much incentive to do it. All they can do is a double spend. They would've been better off spending that energy on mining blocks to be rewarded with the Bitcoin subsidy.
Sure, it's unlikely. But not impossible. Just as runaway inflation in a reasonably managed fiat currency is not impossible. Just unlikely. (And, yes, hyper inflation has happened historically. Similarly, rewriting of the immutable Ethereum chain and BTC forks have happened historically.)
> If they're bored, they can devote some of their hash power to double spend attack the "good" chain. Which chain will come out on top?
That's a different attack entirely.