Nonsense about increasing the 21M supply cap

[apogio]

Is all this fuss happening due to that little disclaimer BlackRock put in here?

As mentioned in one of the replies in that tweet, this is for legal reasons, precisely because BlackRock does NOT control the matter being discussed. This makes sense, given that forks can spawn and then "bitcoins" in those forks can be more than 21 million.

That's the reason yes.
And if there is one little thing in finance with which I agree with Warren Buffett, is that 99% of the news is "just noise".

Seriously though, I like the topic, because people who actually worry about it can see proper arguments about bitcoin's longevity, scarcity and security.

[Primese]

But a 51% attack has no reward. And if a 51% attack happens, Bitcoin keeps on working

51% attacks can totally be profitable.

It could just be normal mining where they produce empty blocks, or censor transactions of specific entities. They can get block rewards while still causing enough chaos to persuade others to switch to their side.

If a 51% attacker produces blocks normally, but reorgs 25% of its competitor's blocks, eventually its competitors will give up and stop mining. With fewer competitors, its work becomes easier and cheaper. Even more profit for them.

If the 51% attacker uses withholding attacks and selfish mining strategies, they could increase their profit even more. It's extremely profitable for 51% attackers.

-----------

No imagine that Bitcoin's security budget drops to the point where over 50% of miners are no longer profitable, and they threaten to fork and continually attack Bitcoin until Bitcoin adds tail emissions. If a blockchain war breaks out, those 50%+ miners are going to win every time. Other miners would be forced to join them or else their blocks would get reorged.

If a CEX doesn't play friendly with the miners, the miners would censor their transactions. If the CEXs and nodes jump to a new blockchain, the attackers can jump too just to harass them. If the CEXs switch mining algorithms while still staying on PoW, they'd be starting from scratch.

[ronin445]

If Blackrock said that they might be planning to create an attack %51 against bitcoin.
Trillions of usd.

[ABCbits]

But a 51% attack has no reward. And if a 51% attack happens, Bitcoin keeps on working

51% attacks can totally be profitable.

It could just be normal mining where they produce empty blocks, or censor transactions of specific entities. They can get block rewards while still causing enough chaos to persuade others to switch to their side.

If a 51% attacker produces blocks normally, but reorgs 25% of its competitor's blocks, eventually its competitors will give up and stop mining. With fewer competitors, its work becomes easier and cheaper. Even more profit for them.

If the 51% attacker uses withholding attacks and selfish mining strategies, they could increase their profit even more. It's extremely profitable for 51% attackers.

-----------

No imagine that Bitcoin's security budget drops to the point where over 50% of miners are no longer profitable, and they threaten to fork and continually attack Bitcoin until Bitcoin adds tail emissions. If a blockchain war breaks out, those 50%+ miners are going to win every time. Other miners would be forced to join them or else their blocks would get reorged.

If a CEX doesn't play friendly with the miners, the miners would censor their transactions. If the CEXs and nodes jump to a new blockchain, the attackers can jump too just to harass them. If the CEXs switch mining algorithms while still staying on PoW, they'd be starting from scratch.

There are some flaws with this scenario,
1. 51% attacker need to have lots of initial funds to obtain ASIC and pay opertional cost, while waiting for any CEX and miner join them.
2. CEX would hesitate to join with the attacker due to pressure from government either because their treasury contain Bitcoin or pressured by investor who buy Bitcoin using CEX, ETF or something similar.
3. Those who hate Bitcoin will take this opportunity to share news about Bitcoin isn't secure or decentralized, which will impact Bitcoin price negatively.

[NotATether]

Question (hypothetical): from a technical point of view, is it possible to increase the number of bitcoins if (let's assume) all bitcoin developers agree to it? They will be able to change the source code?

No, because you're modifying existing functionality of the protocol, so that would require a hard fork.

There are some flaws with this scenario,
1. 51% attacker need to have lots of initial funds to obtain ASIC and pay opertional cost, while waiting for any CEX and miner join them.
2. CEX would hesitate to join with the attacker due to pressure from government either because their treasury contain Bitcoin or pressured by investor who buy Bitcoin using CEX, ETF or something similar.
3. Those who hate Bitcoin will take this opportunity to share news about Bitcoin isn't secure or decentralized, which will impact Bitcoin price negatively.

It's profitable to attack other coins like this. But bitcoin is too big for a 51% attack because it requires trillions of dollars in expenses including

- billions of dollars in ASIC, which BitMain and others cannot even produce enough of in a given calendar year
- billions of dollars in electricity costs at standard rates

Nobody has that kind of wealth except in non-liquid assets (stocks, real estate, trusts) and crypto.

[stwenhao]

Question (hypothetical): from a technical point of view, is it possible to increase the number of bitcoins if (let's assume) all bitcoin developers agree to it? They will be able to change the source code?

Yes, here is how you can do it, if you want to: https://petertodd.org/2016/forced-soft-forks#radical-changes

So what is a valid Bitcoin 2.0 block? It could be anything at all! For example, the inflation schedule can be changed to make the coin supply unlimited.

However, note that we didn't have any successfully activated "evil soft-forks" in the past, so even if possible in theory, it is very unlikely to happen. It is much more likely to have some additional rules, which would be active only in some second layer instead, because then, you don't have to convince everyone.

[PrivacyG]

However, note that we didn't have any successfully activated "evil soft-forks" in the past, so even if possible in theory, it is very unlikely to happen. It is much more likely to have some additional rules, which would be active only in some second layer instead, because then, you don't have to convince everyone.

If an 'evil soft-fork' is activated, will everybody simply move on to a hard forked Bitcoin that still supports the old rules?  Increasing the Supply cap would do so much damage to Bitcoin it is almost impossible to imagine the majority will stay on the evil fork instead of moving back to the original Bitcoin.

[stwenhao]

will everybody simply move on to a hard forked Bitcoin that still supports the old rules?

I don't think so. I rather expect burning overprinted coins instead.

You cannot easily deactivate a soft-fork, by pretending, that it never existed in the first place. For example, imagine deactivating P2SH by saying, that "now, you can spend all P2SH coins, just by pushing the underlying Script on the stack, and nothing else". It would cause more harm than good.

it is almost impossible to imagine the majority will stay on the evil fork instead of moving back to the original Bitcoin

That's why I think it won't reach the hashrate majority in the first place. However, if it somehow will, then I expect the usual thing, which you can see on many altcoins: first, they produce too many coins, then they have some problems, because of that, and then they burn some coins, to fix the problems, which they created earlier.

Also, maybe there will be enough failed altcoins, which did such things, to discourage the Bitcoin community from trying such things?

[pooya87]

That's why I think it won't reach the hashrate majority in the first place.

In that case you can't call it any type of "soft fork". It will be an altcoin like dozens of altcoins created in the past out of bitcoin like bcash...

It is also not an accurate comparison to compare the scenario with altcoins because one of the main characteristics of majority of altcoins is their centralization and lack of interest (ie. people only want to make money and don't care about anything else).
Neither are true about Bitcoin. Meaning bitcoin's hashrate and nodes are distributed and decentralized enough to prevent such shenanigans from happening and also despite the fact that many people buy bitcoin for profit only, there are still many others who care about bitcoin and won't allow it to go down the path of shitcoinary...

[Wind_FURY]

In my opinion, I see one of two things happening:

1. Bitcoin L1 stays at the same fee rates as they are today, but does not achieve mass adoption. There is no hashrate exodus, or attack. Prices eventually cap at some price in the distant future.

That doesn't make any sense because if the miners don't get paid enough to continue hashing, then they'll have no choice BUT to turn off their ASICs.

Unless that argument assumes price will continue to surge ad infinitum.

2. Bitcoin L1 gets mass adopted either through using the UTXOs themselves or by using some project on L1 like Ordinals, Runes. Fees skyrocket to 100+ sats/vbyte, and regular people use Lightning instead. (This would copy Ethereum's outcome.) There is no hashrate exodus, or attack. Prices probably don't cap until 2140 or even later.

Notice how "increase the supply cap and print more bitcoins" is not an option.

That's because it's practically guaranteed to never happen. Nobody who owns Bitcoin will agree to let it become a money printer.

That's my first belief, but nothing is guaranteed especially if it means life or death for Bitcoin. It's highly improbable, but it's still a non-zero chance to happen.

[gmaxwell]

That doesn't make any sense because if the miners don't get paid enough to continue hashing, then they'll have no choice BUT to turn of their ASICs.
Unless that argument assumes price will continue to surge ad infinitum.

Fees in bitcoin are currently and have been sustained at a pretty good multiple of the fees and subsidy several other POW blockchains combined.  Those other chains continue to 'work' to at least the satisfaction of their users.  It may be in the future that security considerations mean that transactions you don't have other reason to trust need to wait for more confirmation.

Traditional banking doesn't settle for days to weeks, so there is an existence proof that current fee levels may be enough and another degree of freedom to offset it if they aren't.  Tools like ecash, channels, etc. have already partially decoupled the speed of transactions from the speed of confirmation.  We should resist falling for it.

Look at the authors of the tweets at the top of the thread, we start with an extreme ethereum shill that has been trashing Bitcoin pretty much since Ethereum existed.  They're just trying to sew discord by convincing people to debate hypotheticals which aren't relevant and may never be relevant.

If there comes a time when fee income isn't significant enough the issue will be easier to consider because the uncertainty will just be about how best to address it rather than also having total uncertainty on the exact situation being addressed.

You're right that there is no guarantees but whatever happens will almost certainly be what the collective users of the system want by the very nature of what bitcoin is and how it works.

[Wind_FURY]

That doesn't make any sense because if the miners don't get paid enough to continue hashing, then they'll have no choice BUT to turn of their ASICs.
Unless that argument assumes price will continue to surge ad infinitum.

Fees in bitcoin are currently and have been sustained at a pretty good multiple of the fees and subsidy several other POW blockchains combined.  Those other chains continue to 'work' to at least the satisfaction of their users.  It may be in the future that security considerations mean that transactions you don't have other reason to trust need to wait for more confirmation.

Traditional banking doesn't settle for days to weeks, so there is an existence proof that current fee levels may be enough and another degree of freedom to offset it if they aren't.  Tools like ecash, channels, etc. have already partially decoupled the speed of transactions from the speed of confirmation.  We should resist falling for it.

Look at the authors of the tweets at the top of the thread, we start with an extreme ethereum shill that has been trashing Bitcoin pretty much since Ethereum existed.  They're just trying to sew discord by convincing people to debate hypotheticals which aren't relevant and may never be relevant.

If there comes a time when fee income isn't significant enough the issue will be easier to consider because the uncertainty will just be about how best to address it rather than also having total uncertainty on the exact situation being addressed.

You're right that there is no guarantees but whatever happens will almost certainly be what the collective users of the system want by the very nature of what bitcoin is and how it works.

 👍

I'm merely trying to be as objective with absolutely no bias with this issue as much as possible. But, humbly, I believe that anyone who speaks in absolutes about this matter might have forgotten that Bitcoin is a software program/decentralized protocol, and we as a community probably must adapt to certain changes in order for the network to keep chugging along.

I'm very confident that the community will come into consensus with what will be good for themselves and the network, IF that problem truly arises.

[graphite]

It's profitable to attack other coins like this. But bitcoin is too big for a 51% attack because it requires trillions of dollars in expenses including

- billions of dollars in ASIC, which BitMain and others cannot even produce enough of in a given calendar year
- billions of dollars in electricity costs at standard rates

Nobody has that kind of wealth except in non-liquid assets (stocks, real estate, trusts) and crypto.

it would only cost 43.2million in electricity to fill a whole days worth of empty blocks.

[Gooner0]

Personally I think one of the solution that can be used to tackle this form of insecurity in Bitcoin is , increasing transactions fees.
It is because allowing higher transactions can push miners to continue validating transactions even as the block rewards decreases.
Also I think an advanced and more efficient Acis or pooled mining can help reduce costs and Ensure profitability.

[tiffy]

Notice how "increase the supply cap and print more bitcoins" is not an option.

That's because it's practically guaranteed to never happen. Nobody who owns Bitcoin will agree to let it become a money printer.

I don't have much of an idea, but I've given it some thought anyway.

I think that the mining process via the Proof-of-Work is the optimal safeguard in the distribution phase of Bitcoin. Bitcoin is distributed in a way that is acceptable to most people. The term mining implies that new Bitcoins are generated in this process. Bitcoin is created with a limited money supply. These things cannot be changed without breaking the consensus. A fork that attacks this would not be successful.

However, it is also clear that the Bitcoin price cannot more than double every four years for all time. This means that fees are becoming increasingly important for miners. This contradicts the decentralized structure of Bitcoin.

How do we escape this dilemma?

Questions:

• What is the point of a mining process that hardly generates any new coins?
• Do validation and mining have to be inextricably linked?
• If the fees exceed the reward, is it possible to add a proof-of-stake layer for validation?

I think we have to deal with these things at some point if humanity wants to use Bitcoin permanently. Solutions are usually found when a majority finds a technology useful.

[PrivacyG]

However, it is also clear that the Bitcoin price cannot more than double every four years for all time. This means that fees are becoming increasingly important for miners. This contradicts the decentralized structure of Bitcoin.

How do we escape this dilemma?

I do not get it, why do you believe Mining becoming increasingly important for Miners will lead to a contradiction in the Decentralized structure of Bitcoin?  To me the two have no link.  Mining will continue to be important for Bitcoin, we still need Transactions and Bitcoin becoming twice as scarce every four years is in my opinion more than enough to sustain it.

Questions:

• What is the point of a mining process that hardly generates any new coins?

If Block Rewards are about zero by that time and Bitcoin becomes twice as scarce every four years, then it simply sounds like Mining Fees will become worth enough to make Bitcoin Mining desirable to most Miners.  Or, there is the option of increasing the number of zeroes after the decimal which I am pretty sure would be allowing for Block Rewards to continue.  Although I think it was franky who said before something interesting.  Putting another zero after the decimal is about the same thing as making the Bitcoin Supply infinite.  Anyway, I do not think that is a solution to be implemented in order to avoid the questions you brought up.

I believe small but worthy Mining Fees are still what will matter and what will continue to sustain a Bitcoin network with no Block Rewards.

[tiffy]

I do not get it, why do you believe Mining becoming increasingly important for Miners will lead to a contradiction in the Decentralized structure of Bitcoin?  

I didn't write that. I wrote that fees are becoming increasingly important for miners. The increase in fees means less decentralization because the miners become more dependent on the users.

If Block Rewards are about zero by that time and Bitcoin becomes twice as scarce every four years, then it simply sounds like Mining Fees will become worth enough to make Bitcoin Mining desirable to most Miners.

But what if it isn't? Is it even desirable for the security of the network to depend on the level of fees? At the moment, the fees are used by users to prioritize their transactions. However, the miners are not dependent on the fees. And that wouldn't be good either, because unlike the mathematically predetermined reward, you can't plan the fees.

I don't have a definitive position on this. I don't have a suggestion that says: "this is how we have to do it!"

But I do know that in sixteen years we will need sixteen times the market price of today to have the same fee-to-reward ratio.

As things stand now, the Bitcoin network would continue to exist with almost unchanged computing power even if there were not a single transaction in it. The miners would simply create empty blocks.

But will that still be possible in 20, 30 or 40 years' time?

And if the answer is no, then my question is simply whether that can be a problem?

My answer: I don't know, but I can't rule it out either.

But enough, I really have no idea. And I think smarter people than me still have a lot of time to think about it.

[mindrust]

If Bitcoin removes the 21 million supply cap, will it still be called bitcoin?

I mean if the miners agree with the proposal and increase the supply limit to a higher number, technically it will still be bitcoin because the miners have the power to change the network rules.

But how many people will accept it?

I think a decision like that would make so many people angry.

I don’t think it is a good idea.

[BlackHatCoiner]

If Bitcoin removes the 21 million supply cap, will it still be called bitcoin?

No. It'd be an altcoin.

I mean if the miners agree with the proposal and increase the supply limit to a higher number, technically it will still be bitcoin because the miners have the power to change the network rules.

The miners cannot do whatever they want with the consensus rules. The fact that the network relies on them does not mean they have any power beyond choosing the order of the transactions. Just remember what happened in 2017 when they tried to increase the block size from 1 MB to 32 MB. It didn't go well.

[Zwei]

I mean if the miners agree with the proposal and increase the supply limit to a higher number, technically it will still be bitcoin because the miners have the power to change the network rules.

But how many people will accept it?

let's say a supply increase does happen, and most miners are on board with it, they will be shooting themselves in the foot. just imagine the price crash that would follow, which in turn, will lower their earnings a lot.
i mean, why would anyone continue holding/investing in an asset whose supply keeps increasing?

and how much are they going to increase it by? because if they don't make the supply unlimited, they will have to increase it again, and again, and again... it will become a joke.
no one with a brain would accept this nonsense. the shitcoin they will create will be dead on arival.