121–130 of 224 posts
Bitcoin is the least efficient technology ever created. There is no limit to how much electricity it can consume just to handle 7 transactions per second. No matter HOW much electricity it uses this value will never increase.
Earlier quoted context omitted.
If you mine a block without revealing it, not only are you the only one that can mine the next block after that, but everyone is mining on the "wrong head". There's of course the risk that someone finds a different head in the meantime, but otherwise, you waste competitors' resources, while you get an advantage on the next block.
They are not mining on the wrong head. They are mining on the current head. If they find a block it will be accepted as the new head and the withheld block will be rejected, so it's not wasted mining time at all.
1. They don't have to wait until another miner finds a block, they can just wait "for some time" and then release their block. All that time gives them the edge for the next block.
2. My understanding is that if two different blocks are found concurrently for the same head, then the network waits for the next block to select which "new head" is accepted. I.e. when there are competing chains, the longer chain wins. So I could imagine that a strategy could be to wait until some other miner announces their block and release yours precisely at that time, hence creating two competing chains. But you presumably have an edge because you have already been mining for a while on top of your block.
Earlier quoted context omitted.
> If a pool can set up a situation where they mine a block and wait X seconds to reveal it, they can force other miners to waste X seconds of has power and gain an advantage. How is it wasted if they work on the current chain? If they find a block during those X seconds, they'll propagate it before the waiting pool does. The waiting pool will then just lose the revenue from the block they put on hold. They're the one…
I might be wrong but I think it's like this.. A finds a block after 1 minute, then powers off and waits for another minute. They reveal the block after 2 minutes. B searches for the block for 2 minutes. After 2 minutes, A has used 1 minute of their compute, and B has used 2.
The Eyal & Sirer paper is pretty interesting - they basically point out that there is actually some game theory involved in when miners should reveal that they mined a block to compete most effectively with their fellows. If a pool can set up a situation where they mine a block and wait X seconds to reveal it, they can force other miners to waste X seconds of has power and gain an advantage. It looks like a result wi…
Isn't this the same thing as saying "if everyone just agrees that a dollar bill is actually just a piece of paper, USD becomes worthless"? Albeit at a smaller scale
I don't know if I have a good comparison here, but maybe something like "if the bank keeps your money for a little longer before validating your transaction, they can use your money for a little longer and make more money from it". Of course if your bank says that a transaction takes 1 year, you will go to another bank. But if they say it takes a day...
Earlier quoted context omitted.
They are not mining on the wrong head. They are mining on the current head. If they find a block it will be accepted as the new head and the withheld block will be rejected, so it's not wasted mining time at all.
Not an expert, but I have two thoughts: 1. They don't have to wait until another miner finds a block, they can just wait "for some time" and then release their block. All that time gives them the edge for the next block. 2. My understanding is that if two different blocks are found concurrently for the same head , then the network waits for the next block to select which "new head" is accepted. I.e. when there are co…
Earlier quoted context omitted.
Not an expert, but I have two thoughts: 1. They don't have to wait until another miner finds a block, they can just wait "for some time" and then release their block. All that time gives them the edge for the next block. 2. My understanding is that if two different blocks are found concurrently for the same head , then the network waits for the next block to select which "new head" is accepted. I.e. when there are co…
There's no edge. Having spent time mining in the past doesn't increase your odds of finding a block in the future.
Earlier quoted context omitted.
How are you so confident that it will never weaken? Especially since there will come a time when the block reward is literally 0.
Tx fees make up a bigger and bigger fraction of miner rewards over time.
Earlier quoted context omitted.
There's no edge. Having spent time mining in the past doesn't increase your odds of finding a block in the future.
The idea is that you can start with the next head earlier than all the others, giving you an edge in being the first to find the next block.
TIL the scale of bitcoin derivatives in 2020 (hence volatility): ~2T on 2B market activity. Jeepers! --- Starting in late 2020, as shown in The Economist's graphic, the spot market in Bitcoin became dwarfed by the derivatives markets. In the last month $1.7T of Bitcoin futures traded on unregulated exchanges, and $6.4B on regulated exchanges. Compare this with the $1.8B of the spot market in the same month. ---
Why would you expect the scale of the derivatives to be related to the scale of the spot market, especially if the derivatives are cash-settled futures? One is basically gambling on the price of BTC going up or down, and the other is trading the actual BTC, right?