if the number of transactions doesn't pick up by 8/16 miners will have to quit

[Robert Paulson]

The block reward is scheduled to be halved on around august 2016.
when that happens unless the amount of transactions fees rises to compensate for the reward drop,
mining will become unprofitable and the hash rate will drop rapidly.
what can be done to prevent this 

[Kazimir]

The block reward is scheduled to be halved on around august 2016.
when that happens unless the amount of transactions fees rises to compensate for the reward drop,
mining will become unprofitable and the hash rate will drop rapidly.
what can be done to prevent this 

What needs to be prevented, exactly? And why?

People saying bullshit like "mining will become unprofitable" clearly haven't got a clue how mining and the adaptive difficulty works.

Minnig will always remain profitable for "enough" people. ALWAYS.

[jonald_fyookball]

The block reward is scheduled to be halved on around august 2016.
when that happens unless the amount of transactions fees rises to compensate for the reward drop,
mining will become unprofitable and the hash rate will drop rapidly.
what can be done to prevent this 

i assume you mean network hash rate... if it drops, then opportunities open up
for more miners and we reach a new equilibrium.  I dont see the problem.

[LAMarcellus]

Welcome to bitcointalk.org!

Please refrain from marginalizing yourself by using sensational titles then admitting total ignorance in your posting.
Perhaps stick to questions rather than statements until you know what you're talking about.
Fair warning; we have ignore buttons and you're question have been answered here in the forum multiple times already.
Act like an adult and watch what you type. Or be treated like a troll.

Keep learning!!
Respectfully,
L

[jonald_fyookball]

Another dynamic to consider is that less new coins means less supply driving up the price and making mining more profitable

[Robert Paulson]

The block reward is scheduled to be halved on around august 2016.
when that happens unless the amount of transactions fees rises to compensate for the reward drop,
mining will become unprofitable and the hash rate will drop rapidly.
what can be done to prevent this 

What needs to be prevented, exactly? And why?

People saying bullshit like "mining will become unprofitable" clearly haven't got a clue how mining and the adaptive difficulty works.

Minnig will always remain profitable for "enough" people. ALWAYS.

when i say mining will become unprofitable i obviously mean mining will become unprofitable at the current difficulty (or what ever it will be when this event happens).
the reward halving will force both difficulty and network hash rate to drop thus making the network more vulnerable to a 50% attack.
unless of course the transaction fee's will be the vast majority of profits made by miners by then.

[Robert Paulson]

Another dynamic to consider is that less new coins means less supply driving up the price and making mining more profitable

you are correct that the reduced inflation will somewhat balance the reward halving shock.
but considering that today transaction fee's are a very negligible profit for miners it seems to me that the block reward halving (and thus almost halving of the miner's income unless the current situation changes)
will be a major shock to the network despite the relatively small reduction in inflation.

[jonald_fyookball]

Adding too much fee will kill bitcoin. Only strongest miners will survive

[Lauda]

Newbie, go do more research before posting nonsense.

[notbatman]

I've seen block reward halfing with alt-coins and their mining profitability remains relatively unchanged. A perfect example of FUD in action on the OP behalf.

The question now is, is this an engineered attempt at FUD i.e. a TROLL!! or simply the result of ignorance and lack of research?

[DeathAndTaxes]

Another dynamic to consider is that less new coins means less supply driving up the price and making mining more profitable

you are correct that the reduced inflation will somewhat balance the reward halving shock.
but considering that today transaction fee's are a very negligible profit for miners it seems to me that the block reward halving (and thus almost halving of the miner's income unless the current situation changes)
will be a major shock to the network despite the relatively small reduction in inflation.

Many people made the exact same predictions (based on dubious analysis) before the last time the block reward halved and it occured with a wimper not a bang.  Some miners became unprofitable and quit.  The lowered difficulty means the remaining miners saw their revenue rise.  The rising exchange rate resulting in a higher USD revenue for a lower amount of bitcoins.

[zimmah]

There are many factors that decide mining profability.

Difficulty
Transaction reward (fees)
Block reward
Hashrate of your miner
Power consumption of your miner
Cost of power in your area
Bitcoin value

Once the block reward halves, some of the other factors will surely balance out.

[Robert Paulson]

Another dynamic to consider is that less new coins means less supply driving up the price and making mining more profitable

you are correct that the reduced inflation will somewhat balance the reward halving shock.
but considering that today transaction fee's are a very negligible profit for miners it seems to me that the block reward halving (and thus almost halving of the miner's income unless the current situation changes)
will be a major shock to the network despite the relatively small reduction in inflation.

Many people made the exact same predictions (based on dubious analysis) before the last time the block reward halved and it occured with a wimper not a bang.  Some miners became unprofitable and quit.  The lowered difficulty means the remaining miners saw their revenue rise.  The rising exchange rate resulting in a higher USD revenue for a lower amount of bitcoins.

the last time the reward was halved the transition went smooth because bitcoin's dollar value grew rapidly.
bitcoin is no longer a hobby of a small group of people, it cannot continue growing in value this fast forever.
it is very possible the dollar value will stay relatively stable when the 2016 halving occurs and so with no fast rise in dollar prices there will be no compensation for miner's lost revenue.
with the cost of operation vs mining revenue equilibrium broken there will be no choice for miners but to shut their rigs down until difficulty and hash rate fall enough for a new equilibrium to be reached.

 

[jonald_fyookball]

I honestly don't think so.  Major cost is in rigs to begin with.  Even if some minors stop ...so what

[notbatman]

How many coins of any currency have you mined? I highly doubt that you're speaking from any kind of experience here.

[master-P]

Since we can't reliably factor in the value of a Bitcoin in the future, there's no way to know whether mining will be profitable by the time of the next halving.

[zetaray]

ASIC manufactures will have to lower their price to compensate, mining will still be profitable

[jonald_fyookball]

Since we can't reliably factor in the value of a Bitcoin in the future, there's no way to know whether mining will be profitable by the time of the next halving.

will always be profitable for someone...even if difficulty decreases (which is unlikely anytime soon)

[freedomno1]

The block reward is scheduled to be halved on around august 2016.
when that happens unless the amount of transactions fees rises to compensate for the reward drop,
mining will become unprofitable and the hash rate will drop rapidly.
what can be done to prevent this 

What needs to be prevented, exactly? And why?

People saying bullshit like "mining will become unprofitable" clearly haven't got a clue how mining and the adaptive difficulty works.

Minnig will always remain profitable for "enough" people. ALWAYS.

Thanks for the prompt reply considering this was a strong argument before last years halving now we have seen what happens afterwards.

[klabaki]

It doesn't matter whether mining is profitable or not.

There is a certain amount of SHA-256 ASIC mining gear in existence and this mining gear just can't magically "disappear".
If mining becomes unprofitable for some miners, then they will sell their hardware. This means that others will buy that very same hardware.
This doesn't change the hashrate at all. It only means that some part of the hashrate will change ownership.

The hashrate can't decrease unless people really start to throw their hardware into the recycle bin.
But no one with half a brain would do that while there are people who want to buy that hardware.

I know that the hashrate decreased once in the past, but that was only because there was still GPU mining at that time.
GPU mining has the serious flaw that mining gear can be used for something else than mining (e.g. gaming) which puts the network at risk of losing this hashrate again.

Luckily, GPU mining is over, so this can't happen anymore. The waste majority of produced ASICs will keep mining until the end of its lifetime.