Bitcoin halving and hardness

[Yoav_account]

I posted this on Reddit and got a bunch of conflicting answers, so thought I may get a clearer answer here.

Am I correct in saying that if the hashrate were to remain the same, bitcoin will be 2x as hard after the 2024 halving as it is now?

Note, I am not talking about the difficulty of the SHA-256 problem needed to mine one block. Rather, I am referring to how hard bitcoin would be as a money/asset, purely from an economics perspective.

Thank you very much.

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[Upgrade00]

You're essentially asking what the result would be on the value of Bitcoin as a currency or asset after the halving, if there is no change in the difficulty level required to mine blocks?

In my opinion, that should somewhat have an effect on the value or hardness as you call it. It shows that miners deem the value of Bitcoin to still be the same, despite the fact that they are getting only half of the reward that was available, which could be an indication of an increase in the value from before the halving or an expected bull run.

This does not mean that there is a direct correlation and that there would be an immediate impact on the market if that happens, but it would influence trader sentiments

[NeuroticFish]

I posted this on Reddit and got a bunch of conflicting answers, so thought I may get a clearer answer here.

Am I correct in saying that if the hashrate were to remain the same, bitcoin will be 2x as hard after the 2024 halving as it is now?

Note, I am not talking about the difficulty of the SHA-256 problem needed to mine one block. Rather, I am referring to how hard bitcoin would be as a money/asset, purely from an economics perspective.

Thank you very much.

While the miners will get half of the block rewards (plus probably same transaction fees, let's not forget) for the same amount of work (and spent electricity) since you said that the difficulty won't increase, this doesn't necessarily mean that the price on the exchanges will double. It's not only the miners who are selling bitcoin.
It should have an effect, but it's not easy to predict how big that effect will be. As said, there's no direct correlation. On the other hand, if we go by the s2f model, the price should get to some 3.5x current value (so much "stronger" than what you say).
Even more, that price is usually counted in gradually, it doesn't happen in the second (or day, or week) of the halving.

[crwth]

Is hard even the correct term? If you search for the meaning of it.

hard·​ness | \ ˈhärd-nəs  \
Definition of hardness
1: the quality or state of being hard
2a: the cohesion of the particles on the surface of a mineral is determined by its capacity to scratch another or be itself scratched
— compare MOHS' SCALE
b: resistance of metal to indentation under a static load or to scratching

That's just the wrong adjective, IMO. It can be used differently, but it's confusing if you think about it. What is hard about it? Is it to get Bitcoin? Is it because of the price that's why it's harder to get? I think the best description is the one that has something to do with the cryptography being solved.

[Yoav_account]

That's just the wrong adjective, IMO. It can be used differently, but it's confusing if you think about it. What is hard about it? Is it to get Bitcoin? Is it because of the price that's why it's harder to get? I think the best description is the one that has something to do with the cryptography being solved.

By "hard", I mean hard Vs. easy money. Ammous talks about this.  I suppose the adjective "hard" in this context is synonymous with "difficult". I didn't use that word ("difficult") because, as you say, it has connotations with cryptography being solved, which is not what I am asking about.

Maybe I have misunderstood what hard means and I am using it incorrectly.

[NeuroticFish]

Maybe I have misunderstood what hard means and I am using it incorrectly.

There's a good chance that your choice of words could have been the cause for so many contradictory answers you've got on Reddit? (I didn't look there for your post though, so I may be wrong).
I think that the word you were looking for may have been "expensive"? At least this is how I've read/understood your question "will bitcoin be 2x more expensive than now?"

[Yoav_account]

Maybe I have misunderstood what hard means and I am using it incorrectly.

There's a good chance that your choice of words could have been the cause for so many contradictory answers you've got on Reddit? (I didn't look there for your post though, so I may be wrong).
I think that the word you were looking for may have been "expensive"? At least this is how I've read/understood your question "will bitcoin be 2x more expensive than now?"

My understanding of what happened on Reddit is that the misunderstanding was indeed due to the word "hard". Many in the Bitcoin community automatically associate this word with the difficulty of the SHA-256 problem one needs to solve in order to mine a block. Therefore, many of the answers were "no, the puzzle will only become harder if the hash-rate increases".

Expensive may be a better word, but that has connotations with market value, which, as said before, is not solely decided by miners. Perhaps "the cost of producing 1 bitcoin", is the best phrase.

Thank you for your help. I greatly appreciate it.

[SquirrelJulietGarden]

I posted this on Reddit and got a bunch of conflicting answers, so thought I may get a clearer answer here.

No one can answer you that it is Yes or it is No because you are talking about future. Who knows what will happen in future?

Am I correct in saying that if the hashrate were to remain the same, bitcoin will be 2x as hard after the 2024 halving as it is now?

You can check past halvings and Bitcoin makes its new all time highs after each of past three halvings. Future halvings, will Bitcoin repeat it? If it does as the past halvings, it will make new all time highs after future halvings. However, we can not say it will certainly happen. In addition, making a new all time high is probably but making new all time highs that are 2x of past all time high is harder. It is possibly too but harder to achieve.

Rather, I am referring to how hard bitcoin would be as a money/asset, purely from an economics perspective.

It can be both. A currency, an asset, a payment tool.

[BitMaxz]

Am I correct in saying that if the hashrate were to remain the same, bitcoin will be 2x as hard after the 2024 halving as it is now?

Actually, that's impossible to happen that you can see hashrate today will be the same until 2024. I'm sure if blockhalving is coming there are more people who will mine because they know the bull market is coming. And the result is not instant since 2024 is the year of blockhalving it will take months or a year to see the price increase due to demand and supply.

I think the question you actually want is that "if the demand today is the same after 2024 blockhalving, Bitcoin will be 2x more expensive than the last year ATH"?

If you talking about the hashrate and difficulty then the difficulty will stay the same but if hashrate increases the difficulty is also increasing. Like they said the higher the difficulty, the more secure.
And mining difficulty is maintained 10 minutes duration for finding new blocks if the network hashrate increases miner will mine blocks lower than 10 minutes duration if it happens then the difficulty will automatically adjust so it will increase just to maintain the 10 minutes duration in finding blocks.

[franky1]

even if the hashrate did not change.. asics can still get more efficient.

EG imagine a 200exahash rate.
2020 it was using 95thash asics of 3.25kwh  (29thash per kw)

in 2023 it will be ~300thash for 5.5kwh       (54thash per kw)

meaning half the cost to mine just by using better asics. so when there are half as many coins.. it still ends up the same.. cost per coin (roughly)

so its not as simple as saying half as many coins =double the cost

[Yoav_account]

even if the hashrate did not change.. asics can still get more efficient.

EG imagine a 200exahash rate.
2020 it was using 95thash asics of 3.25kwh  (29thash per kw)

in 2023 it will be ~300thash for 5.5kwh       (54thash per kw)

meaning half the cost to mine just by using better asics. so when there are half as many coins.. it still ends up the same.. cost per coin (roughly)

so its not as simple as saying half as many coins =double the cost

Very true. I am just asking ceteris paribus for understanding's stake.

[franky1]

all other things being equal..
if the asics remained the same generation.. the hashrate, difficulty remained the same.. where only the coins halved...
still does not mean asics are getting half as much money to cover their costs(work)
.. the price could double meaning the miners get paid the same.

however change one variable and the paradigm can go in any direction

[Yoav_account]

.. the price could double meaning the miners get paid the same.

If bitcoin is the unit of account.

By "hard", I mean how much energy is needed to get 1 unit of bitcoin.

[Fivestar4everMVP]

I don't know very much about Bitcoin mining, but from the little I know, I can say that... Well, to start from the base.
We all know that every halving reduces the amount of Bitcoins miner are able to mine per block, this makes Bitcoin scarcer for the miners in particular, this can actually influence the price of Bitcoin in the open market in several ways, and one of those ways is sentiment, that is investors or traders sentiments, they think that since Bitcoin has become scarcer for the miners, they probably would not want to sell their mined Bitcoins cheaply in price, then they begin to buy in anticipation for a bull run, I believe this explains why Bitcoin price always goes through the roof mostly when halving is approaching and sometimes, immediately after the halving too.

[so98nn]

even if the hashrate did not change.. asics can still get more efficient.

EG imagine a 200exahash rate.
2020 it was using 95thash asics of 3.25kwh  (29thash per kw)

in 2023 it will be ~300thash for 5.5kwh       (54thash per kw)

meaning half the cost to mine just by using better asics. so when there are half as many coins.. it still ends up the same.. cost per coin (roughly)

so its not as simple as saying half as many coins =double the cost

Exactly. There could be many different possibilities for this question and future of bitcoin in correlation with the halving. Block halving is big event for miner, the reward is halved from the current reward structure and this is happening since bitcoin was first mined. This means it’s continually halving each time, and by so far it’s reduced to minimal. Thus to keep up the race of mining profitable usually miners will increase the power of hashing (by adding more miners) and thus ROI shifts further. However they will always sell bitcoins prior to halving causing massive dump (so that miners can profit before it’s bearish). In the process world wide buying surge starts and bitcoin slowly pushes itself towards new arena of high price asset.

This is what can be seen from the historical charts. So price mostly will go up if that’s what you wanna know.

[franky1]

.. the price could double meaning the miners get paid the same.

If bitcoin is the unit of account.

By "hard", I mean how much energy is needed to get 1 unit of bitcoin.

miners pay money to give energy to asics to mine bitcoin. it has to be profitable to do this.
if there was half as many units being made. its not a simple half as many asics using energy.. because the price of the unit is also a factor, that keeps the asics competing..

other factors at play..

imagine the price 2020-2023 averaged $30k/btc.
there are some miners that mine with costs of $30k  (a)
there are some miners that mine with costs of $25k  (b)
there are some miners that mine with costs of $20k  (c)
there are some miners that mine with costs of $15k  (d)

lets for pencil demo sake use numbers of the 200exahash
abcd each have 50exa..
all getting the same amount of coin share per day (900 a day/4 = 225each)

in 2024 when coins per day drops to 450
A and B can pull out as their halved share(112.5 each) wont cover costs if the price was the same.
but now C,D continue mining and they get AB share.
so when coins per day drop to 450, that 450 is shared between only CD meaning they still get 225 coins each per day
also the competition. they could add more hash power becasue they can still afford it
after all they were mining at 225 coins where average coin was $30 but they had costs of $15k/$20k. so they can afford to increase hashrate
D can increase 2x meaning 100exa total for him
C can increase 1.5x meaning 75exa total for him
where hashrate is 175exa (seems less then the 200exa before. but now you have to factor in the next gen asics that are more efficient where they can hash more hashes for same cost.)


there are a few different factors at play
ill leave you to play around with the math of that although i gave hints in previous post about the next gen asic hash/electric rate. difference(~double)

[darkangel11]

Am I correct in saying that if the hashrate were to remain the same, bitcoin will be 2x as hard after the 2024 halving as it is now?

Bitcoin gets 2x as hard when Ms Bitcoin wears something nice to bed.

What can I say, after the halving miners get less reward for the same job, but it doesn't mean bitcoin gets hard. It sure does sound funny though, I give you that.
Remember that mining difficulty can go up or down. It's the reward for mining a block that changes.

[Husires]

Mining affects the price of Bitcoin, but certainly this effect will not be direct or instant. In many of the previous historical models, the price needed about a year or more to start making real gains.
Which means that the decrease in the price of bitcoin from the cost of mining will affect, but it will not be direct or instantaneous, but may extend for a few years.

Put all these assumptions side by side and what happens with economic problems and we may need more than a year after Bitcoin halving

[Yoav_account]

Am I correct in saying that if the hashrate were to remain the same, bitcoin will be 2x as hard after the 2024 halving as it is now?

Bitcoin gets 2x as hard when Ms Bitcoin wears something nice to bed.

What can I say, after the halving miners get less reward for the same job, but it doesn't mean bitcoin gets hard. It sure does sound funny though, I give you that.
Remember that mining difficulty can go up or down. It's the reward for mining a block that changes.

I was waiting for someone to say this .... lol

but it doesn't mean bitcoin gets hard. It sure does sound funny though, I give you that.
Remember that mining difficulty can go up or down. It's the reward for mining a block that changes.

Bitcoin blocks don't get harder to mine, but surely Bitcoin as an asset/money does? You need 2x more energy to get 1 bitcoin than you did before.

It's weird to think about because "hard" usually refers to the difficulty of the mathematics. I am not particularly well-red about this, though, so it is very likely I am misunderstanding.

[cr1776]

I posted this on Reddit and got a bunch of conflicting answers, so thought I may get a clearer answer here.

Am I correct in saying that if the hashrate were to remain the same, bitcoin will be 2x as hard after the 2024 halving as it is now?

Note, I am not talking about the difficulty of the SHA-256 problem needed to mine one block. Rather, I am referring to how hard bitcoin would be as a money/asset, purely from an economics perspective.

Thank you very much.

Are you asking about this by chance?
https://tradesmithdaily.com/educational/bitcoin-is-the-purest-form-of-hard-money-ever-created-2/
or this?
https://medium.datadriveninvestor.com/bending-bitcoin-the-principle-of-hard-money-ad577bdfbc14