Bitcoin Forum

I see here all wise guys debating the block size increase causing centralization, and then other groups of people deny that. Its a waste of time debate from the point of view of centralization.

Because all of you fail to see that the mining difficulty increase is the thing that is causing centralization.

The bigger the difficulty, the more capital it requires to mine it, the more centralized it becomes, as only big miners can afford equipment and stay competitive in low electricity countries.

The mining difficulty doesnt affect bitcoin inflation, so there is absolutely no point in having it increase, other than deliberately creating a centralized system, which is foolish


The mining difficulty should have never increased, if we would wanted a real decentralized currency. Because now its a debate of a dog catching its tail.

I cannot believe I`m the only one seeing this, and everybody else is bamboozled with the block increase debate...

Bitcoin will become a miner oligarchy, I`m fine with that, but i think this is not satoshi's true vision of bitcoin.


I`m not a technical expert, but i`m sure it's doable, many other altcoins have non-increasing mining difficulty.

Static difficulty would affect inflation/issuance model.

ELI5: Imagine you're the only miner with 1 ghs/ and you're getting 25 BTC per block, then I come in with my 1 gh/s and I'm also getting 25 BTC/block (since difficulty didn't increase) and then thousands of others join in. How would you keep 21mil cap with no difficulty adjustment?

You want fixed cap/supply - you need adjustable difficulty
You want low difficulty forever - you have unlimited supply

And yes, Satoshi was aware of that.

There should be some other way to resolve that dilemma. Again i`m no technical expert, but I find it hard to believe that nobody in the world can come up with such solution.

Yet there are coins like Bytecoin that solve this issue.

Nope -> https://coinplorer.com/Charts/Difficulty/BTE

There are clearly difficulty increases. They just have no growth in hashpower recently which keeps the difficulty steady.

Ok then something like that.

It doesnt have to be static, it can have some freefloat.


What I`m saying is that it doesnt have an uptrend in difficulty like bitcoin has.

http://www.coindesk.com/data/bitcoin-mining-difficulty-time/

Bitcoin has a linear uptrend by design, that has already eliminated small Joe with average PC.

Are you serious? It's flat/free-floating because mining power is flat. If more people started to mine this alt, the difficulty would go up.

You're basically asking to solve the problem of 'eat cake and have cake'.

Again, Flat difficulty or Limited supply. Pick one. You can't have both.

uh no as long as it appear that the new farms added are not on the same place, and are not controlled by the same entity, this is not centralization

also the mining difficulty help to secure bitcoin network, without a strong diff, the network would be vulnerable to certain attacks, that are well known

In the future, more efficient ways to mine could be possible if developers put their minds to it.

just in my opinion, if the mining difficulty wasn't increased, bitcoin price will go down and becoming very cheap,the increasing of mining difficulty is the solution to keep the bitcoin price,just some miners didn't agree because it makes their revenue smaller than before

Exactly, is like to say that there is lot of points where bitcoin is centralized, i mean big farms, so in the end there is no centralization.

Well maybe if there is only one big farm around the world and all the rest are just small mining farm, then yes, i would agree with the OP, but right now we should not talk about centralized only because difficulty is increasing and there is some big farms.

I would personally love to see a way to mine while walking, riding a bike, etc.

Not quite true. Bitcoin network doesn't require powerful miners to exist. Such miners emerged as a result of free market mechanism aka competing for block rewards.


There actually is (was?) an app that allowed you to earn BTC while working out:

http://www.newsbtc.com/2015/03/15/new-app-lets-earn-bitcoin-breaking-sweats/

actually the difficulty increase is good..

1. it stops a single person just buying out the hashrate.. as the cost increases. (solo mining/farms are on the decrease)
2. at some point when the electricity usage exceeds a whole town.. the electricity companies will cut off the mining farms, due to causing blackouts in town
3. its easier to have 5mining farms linked to a pool then one farm having electricity issues
4. if 5000 people mined 0.02% of a mining farms hash.. they would in total receive the equivelent of the farm.

thus 5000 people only need 0.02% of the total equipment cost of a farm and total electricity, each..

and this is why pools were invented. because bitcoin difficulty got too big for solo mining..
and the more the difficulty rises. the less solo miners there will be (less farms)

Sure you can. The 21M BTC cap exists regardless of hashpower. Without an adjusting difficulty, all those coins would simply get mined much faster. After the last block subsidy was mined, the miners would need to make do with fees alone.

I imagine what would happen, assuming BTC can be valuable without difficulty adjustments, is that all the BTC would be minted rapidly, with blocks found perhaps every few seconds, and then most miners would rapidly shut down since the BTC user base never had time to grow enough for fees to pay the miners costs.

gold analogy:
i think the OP is just butt-hurt that he missed the golden days of pickaxe mining' and is now saying gold mining is flawed because he cannot afford a sluice machine an excavator..


my last post explained why his thoughts are flawed,.. solo mining is becoming near on impossible. and it will start to be more like co-ops and groups.. rather than farms.. as there is a limit to how many machines and how much electric can get to a single location

The real problem is that cheap electricity is generally available only in god forsaken places where no civilized humans live.

As long as 1000W miners are available to consumers people should be able to mine at home as long as they have cheap enough electricity.

Bitcoin mining is already centralised with the pools. Most big miners save more with mining on a pool, they don't have to think about webhosting and security issues. Mining is still viable for those without electrical fee or at least have low electrical fees.

If you're not going to let difficulty increase, blocks would be as fast as one second, everyone would be able to mine and Bitcoin would not be as precious as it would be. Of course, the faster the block, the less security it would have compared to an average 10 minute block.

There's good reason for increasing mining difficulty. If difficulty never increased, the 21 million bitcoins would have already been mined years ago. Difficulty keeps the block target averaged to about 10 minutes per block. Keep reading about bitcoin.

cheap electric is not for people in 'no-mans land'

infact china is the most populated country in the world,
and all them places where a neighbour lives 100 miles away AKA australia.. the electric is higher. because of the cost of installing all them electric cabling.. 100 miles worth for just one person is not cheap.

secondly electric companies wont pump industrial amounts of electric down cabling designed for single users..

thus in both cases, disproves that living in no-mans land is cheap

EG
cambodia 2x expensive than china
new zaland 3x expensive than china
uk 3x expensive than china

the idea is that mining will become profitable if the bitcoin price goes up. Unfortunately I dont think the price matches the difficulty but I think that will change very soon. :)

Mining is profitable for those with powerful and efficient mining hardware and cheap electricity. Otherwise they wouldn't be mining.

If you're hoping that the price increase will make your 335 Mh/s USB block erupter profitable again - that's unlikely to happen (unless there's x100 pump before difficulty adjustment).

what will happen when those cheap electricity places, will be "saturated", and they will be forced to change place, with higher electricity

this will make mining more casual, because electricity will be levelled at some point? or it will kill the mining one day, in the case, obviously, that the value won't rise accordingly?

/facepalm

More miner means it's harder to attack the network, more security is better.

As long as a single miner doesn't have a large share of the network it's a good thing the difficulty is high, and the higher the difficulty is the harder it becomes for a single miner to own it.

More hashing power does indicate a higher security of network by making it harder and expensive for attacker to attack Bitcoin.

However, it can push miners to concentrate in a region with lower electrical fees. Most won't have a UPS since mining costs are too high. What if that region experiences a blackout? The network hashrate would drop immediately. If it's serious enough, blocks would be slower significantly.

Don't worry about that. There are thousands of teenagers around the world with obsolete miners/graphic cards and "free" electricity (bills paid by parents), they will keep the network going if that happens ;)

There's bigger centralisation threat from pools (we've already seen ghash going above 50% for a short period) or manufacturers (someone could develop mining hardware vastly outperforming current miners). There will always be some risks/threats.

As I said, the miners who have low electricity rates do already own a huge part of the network. Blocks would be much slower if the hashrate drops slowly. I doubt it would be profitable for home miners to even mine at that time.

IMO, manufacturers would sell their miners at sky high prices than wasting money on hosting the ASICs themselves. It can take months for it to ROI and other companies would have released ASICs in big batches.

So you think the few billion computers around the world cannot generate enough mining power than a few thousand ASICS?

Small difficulty doesnt mean that the asics would not be useful, it means that they would make less, and small guys could mine too with a laptop.


It would be a true decentralized system, and the mining capacity will be much more in aggregate.

Few billions? You expect every computer in the world to mine BTC?

Current hash rate: ~ 500,000,000 Gh/s, average CPU hash-power: ~0.05 Gh/s (optimistic). You'd need ~10 billion CPUs to match the current hash rate.


Why would you run expensive ASIC if you could earn the same by mining with your old laptop?

You're not the only one to see it, and it was always meant to be like this from the beginning.


https://bitcointalk.org/index.php?topic=532.msg6306#msg6306


http://satoshi.nakamotoinstitute.org/emails/cryptography/2/#selection-67.0-83.14

Sure but the average PC would not steal more from the miners, if the miners want to mine more they would use ASIC.

So the Average PC + ASIC would be added cumulatively, and the hashing power would be even higher.



Greed? Why would you buy 2 ASIC if you can buy 1?

Dont u understand, if the difficulty is near to 0, the miners would still buy ASICS to get a bigger slice of the mining income.

However it would also let average PC people mine it, thus the mining capacity would be higher than now, and more evenly distributed.

This is still the biggest problem in my opinion.

Mining difficulty doesnt correlate with network size, in fact it would be negatively correlated.


If the difficulty were easy, we would have more competitions. In addition to all ASICS, we would have home PC's running it, and the average Joe would get a bigger pie of the game, to be motivated to run bitcoin node at home.


So

LOW OR NO MINING DIFFICULTY =  MORE NODES, MORE MINERS, MORE MINING POWER, BIGGER NETWORK, MORE DECENTRALIZATION


INCREASING OR HIGH MINING DIFFICULTY =  LESS NODES, LESS MINERS, THE NEED OF POOLS, LESS MINING POWER IN LESS PEOPLE HANDS, GREATER RISK OF 51% ATTACK, OLIGARCHIC MINING CARTELS, CENTRALIZATION


Sorry but Bitcoin fucked this up, severely!!! :(

are you saying that when the halving occurs BTC will rise?

If the difficulty does not increase, due to the large hashpower of the network, the blocks would be much much faster. This wouldn't allow for the capped supply that Bitcoin features. Orphaned blocks would also be much more often and thus allow for a higher block reorg. We won't ever be see a confirmation to be safe. In addition, your logic is flawed. With no or low difficulty, bigger players can still generate blocks much much faster than an average joe. This would benefit them even more.

Low difficulty does not mean that most would be solo mining. People can still use a pool and get similar payouts.

I`m not sure about those claims, i`m no expert. So can anybody else confirm or deny this?

It seems plausible at least.


Of course, but the average joe would have larger share for himself. Right now how much can an average joe mine?

1 satoshi/ day? With a low difficulty you could mine as much as a faucet give you for example.

So when newbies still ask on the beginner section how to mine bitcoin wit PC, you could give them a way to join bitcoin for mining.

Nobody knows if the mining dificulty curve is good or bad, perhaps it could have been increasing later.

Bitcoin should have had a bigger inflation in the first years, to attract many people via mining, and much less inflation later when serious developers join it to safeguard funds.

Yes the mining difficulty is my problem because my S5 feels like the S1 I used to have. I wonder if the difficulty is forced to increase  do to the fact that halving will happen . Litecoin halved and was quiet for awhile. Can you imagine bitcoin halving and the difficult along with it?

With low difficulty, Bitcoin would be easier to get. The price would be much much lower or even be worthless and mining wouldn't be profitable for small players nonetheless. Mining Bitcoin places unnecessary stress on the GPU and the better way to test it out is to get a cheap USB block erupter. By shorterning the block time or difficulty, it is easier for people to double spend and would scare people away from Bitcoin easily.

Don't you think faucet is a much better way for users to test out Bitcoin instead of wasting electrical fees and potentially damaging their components if they have poor PSU which are unbranded and dangerous.

If the mining cost can be continuously pushed down below bitcoin's exchange rate, then all the buyers will eventually go to mining to acquire bitcoin, and raise its difficulty until the cost is close to market price again. So mining difficulty increase means rising mining cost, it is a positive sign of capital inflow

Another possible reason that mining difficulty increases all the time is that large capitals are fleeing china through buying mining hash power and get bitcoin to spend in another country. Money laundering is very feasible through mining: Kncminer's bank account just been shutdown, I guess that has something to do with flagged suspicious money sending to their account purchasing mining hash power

This is correct, the only think which affects inflation is block halving. All mining diff does is redistribute mining rewards from one user which slower miner to another user with faster miner.

HOWEVER, how would you solve the issue of people adding tons of miners to the market. They all want their shares so I d say this is an elegant solution which fosters competitions and competition fosters innovations and development.

It's possible but I wouldn't be so sure about that.
There's a roof that is not being useful to pass about spending on hardware to mine Bitcoin.
On top of that, mining hardware will slowly become too expensive, and mining itself as well for electricity consumption.
And last but not least, there will come a time when no more BTC will be available to mine.
People will mine only for fees, it will be distributed.

Why is it a problem? The network is automatically adjusting the difficulty and hash power, fairly distribute the mining reward between miners proportional to their hash power. If the mining is still profitable, miners will continue to add or upgrade their asic miners,  and maintain current hash power. They just try to compete with other miners for more rewards. As difficulty and hash power increases, the network becomes more secure.

he is actually very wrong, the price is already above the diff, in the sense that miners have the ass covered for the next halving already at the current value on the market

let alone what would be the price prior the halving, much higher than what we have today, there is no way we are going to sub 300 again when it was rock solid for 10 months

Yes, at one moment I was worried about mining, especially when we were flirting with breaking $200 for a while.

At these current prices we have nothing to worry about and the price will surely increase even more before the halving and as this trend continues.

I guess that mining will be again very, very profitable!

If the difficult keeps 8% on rising every 13 days and the bitcoin price does not rise, it will be not profitable for most miners in the next reward halving.