Automatic Difficulty Adjustment Proposal for Bitcoin: Doomsday Safeguard

[JohannesX]

Dear Bitcoinbros,

I would like to propose a solution to a potential vulnerability in the Bitcoin network, particularly during times of global catastrophes or significant disruptions in hash rate.

Imagine a scenario where a sudden and prolonged decrease in hash rate occurs due to a global catastrophe, such as widespread infrastructure and or hardware damage (f.e. because of an atomic war, an unforeseen solar storm, etc). In such cases, it could take many months or even years to rebuild and restore the hardware necessary to reach previous hash rate levels. During this time, the network could essentially become unusable, as no blocks would be found until hash rate levels return to normal.

To address this issue, I suggest implementing an automatic difficulty adjustment mechanism as a contingency measure. If no valid block is found within a certain timeframe (e.g., 48 hours), indicating a significant drop in hash rate due to unforeseen circumstances, the network would automatically adjust the difficulty level to a more suitable level as it would after 2016 blocks anyway.

As a non-coder of course I have no idea how to implement that technically but such emergency adjustment would enable miners theoretically to continue finding blocks at a reasonable rate, even during periods of low hash rate caused by sudden global disruptions - it would make Bitcoin really doomsday resistent!

By proactively addressing this potential vulnerability, we can ensure the stability and continuity of the Bitcoin network, even in the face of unprecedented challenges. This proposal would require thorough discussion within the Bitcoin community - but of course it is also possible that I am simply making an embarassing mistake and that the problem described has long since been solved, even for worst-case scenarios.

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[ranochigo]

Bitcoin Testnet has such a difficulty adjustment but it introduces a lot of quick blocks being mined simultaneously.

For starters, this isn’t that big of a concern since a huge overnight hit to the hashrate would indicate something far more serious than just a climate event happening, perhaps a nuclear war. If that happens, I’m not sure if mining would continue happening since every country would either be annihilated or imposing martial law. Hence, I don’t think it is worth a hard fork.

This also introduces the possibility of miners trying to game the system by intentionally mining periodically to ensure that they try to get as many low difficulty blocks as possible. Either of this would not be good to Bitcoin.

[ABCbits]

In such extreme scenario, i expect people would try to trade their money for physical goods which makes money no longer valuable. I'd rather see Bitcoin community accept necessity of increasing maximum block size rather than prepare for this kind of extreme scenario.

Bitcoin Testnet has such a difficulty adjustment but it introduces a lot of quick blocks being mined simultaneously.

Something more complex such as EDA (Emergency difficulty adjustment) which used by BCH would be better option.

[LoyceV]

Imagine a scenario where a sudden and prolonged decrease in hash rate occurs due to a global catastrophe, such as widespread infrastructure and or hardware damage (f.e. because of an atomic war, an unforeseen solar storm, etc). In such cases, it could take many months or even years to rebuild and restore the hardware necessary to reach previous hash rate levels. During this time, the network could essentially become unusable, as no blocks would be found until hash rate levels return to normal.

Let's be realistic: in those scenarios, Bitcoin is the last thing on my mind. Without global network, you'll end up with separate Bitcoin chains: Chinese miners will mine their own blocks, European miners will use other blocks, and American miners will also have their own chain. Once global communications get restored, the longest chain will force a reorganisation on all other continents. Unless there's a manual intervention, for instance because the interests have become too big. In that case Bitcoin may Fork into different versions for each continent.

the network would automatically adjust the difficulty level

If for some reason 99% of all hashrate gets destroyed, a manual intervention can adjust the algorithm with support of the community when needed.

In such extreme scenario, i expect people would try to trade their money for physical goods which makes money no longer valuable.

It's probably going to be gold, cigarettes and booze that's traded for food. Unless the other guy has a gun, then you lose.

[ranochigo]

Something more complex such as EDA (Emergency difficulty adjustment) which used by BCH would be better option.

EDA or their improved DAA are not well implemented and there are many drawbacks to those. It was demostrated that the implementation that BCH used wasn’t good enough for production and it’s only there because the hashrate is low enough to be influenced by swing miners.

My understanding is that these difficulty adjustments with a moving window or a different algorithm like Kimoto Gravity Well has too many drawbacks and should only be considered if the hashrates swings rapidly frequently.

[ABCbits]

Something more complex such as EDA (Emergency difficulty adjustment) which used by BCH would be better option.

EDA or their improved DAA are not well implemented and there are many drawbacks to those. It was demostrated that the implementation that BCH used wasn’t good enough for production and it’s only there because the hashrate is low enough to be influenced by swing miners.

My understanding is that these difficulty adjustments with a moving window or a different algorithm like Kimoto Gravity Well has too many drawbacks and should only be considered if the hashrates swings rapidly frequently.

Yeah, i'm aware it has few major flaws (there are even few research about it) and hence why EDA was replaced with modified DAA instead. Although on other hand, is there any less worse algorithm which already tested on live network?

[ranochigo]

Although on other hand, is there any less worse algorithm which already tested on live network?

Not that I currently know of. Loads of altcoins has their own difficulty adjustment, DGW (Dark Gravity Wave) and Digishield are prominent ones, and AFAIK there were different tradeoffs as well. The algorithms are generally designed for specific goals and has different tradeoffs. It wouldn't be applicable to Bitcoin because we don't have huge fluctuations in hashrates. No such thing as less worse, because they are all not good enough if you've got a network that is stable.