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Author Topic: Who secures the network once all bitcoins have been mined  (Read 1061 times)
majestik12
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April 03, 2012, 05:02:51 AM
 #1

I am not a newbie but have watched the rise of bitcoin with intense fascination. I don't believe it is the solution for humanity, however I do believe it has the power to destabilize governments (facilitating untaxable trade).

I have a stupid question. I searched for the answer first and couldn't fine, but who secures the network once miners (people who secure the network) have no incentive to mine (when all bitcoins have been mined)?

Thanks,

Majestik12
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Stephen Gornick
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April 03, 2012, 06:41:34 AM
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who secures the network once miners (people who secure the network) have no incentive to mine (when all bitcoins have been mined)?

Transaction fees will need to replace the currency issuance in the block reward.

Quote
When operating costs can't be covered by the block creation bounty, which will happen some time before the total amount of BTC is reached, miners will earn some profit from transaction fees. However unlike the block reward, there is no coupling between transaction fees and the need for security, so there is less of a guarantee that the amount of mining being performed will be sufficient to maintain the network's security.

 - http://en.bitcoin.it/wiki/Myths#After_21_million_coins_are_mined.2C_no_one_will_generate_new_blocks

BadBear
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April 03, 2012, 06:42:25 AM
 #3

https://bitcointalk.org/index.php?topic=75048.0

1Kz25jm6pjNTaz8bFezEYUeBYfEtpjuKRG | PGP: B5797C4F

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CecilNiosaki
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April 03, 2012, 02:36:19 PM
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I was also wondering this and was looking forward to the answer. Thank you for sharing Smiley
majestik12
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April 03, 2012, 06:31:32 PM
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When would a transaction fee take place. Is it whenever a bitcoin changes hands?

Are there charts notating daily transaction volume?

Daily coins being mined?

Has anyone extrapolated these numbers to come up with an estimate as to how much a of a fee would be required to keep miners going at current rates?

Thanks,

Majestik12
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April 03, 2012, 06:46:44 PM
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According to http://blockchain.info/charts/miners-operating-profit-margin miners are around %24 profitable.

So thats a break even at around 38btc reward per block.

This is at current difficulty.

Stephen Gornick
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April 03, 2012, 07:39:33 PM
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When would a transaction fee take place. Is it whenever a bitcoin changes hands?

 - https://en.bitcoin.it/wiki/Transaction_fee

Are there charts notating daily transaction volume?

Daily coins being mined?

Yes, and yes:
 - http://blockchain.info/charts

Deafboy
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April 03, 2012, 08:52:35 PM
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You have my sword...
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April 03, 2012, 11:40:31 PM
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Someone with some real cash(like a bank) can easily kill bitcoin just by achiving 50% of hashrate or destabilize it by joining the biggest pool swealing it to 51%. Currently it wouldn't be so hard to do, it's just under the radar of big realworld intitutions.
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April 04, 2012, 03:04:26 PM
 #10

I am not a newbie but have watched the rise of bitcoin with intense fascination. I don't believe it is the solution for humanity, however I do believe it has the power to destabilize governments (facilitating untaxable trade).

I have a stupid question. I searched for the answer first and couldn't fine, but who secures the network once miners (people who secure the network) have no incentive to mine (when all bitcoins have been mined)?

Thanks,

Majestik12

tx fees, a beautiful thing when you're receiving them Smiley

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April 04, 2012, 03:08:47 PM
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IIRC, the coins will all be mined in 2140 or so.

Let's make some Dogecoins together! http://doge.litemoons.com:9555
Explodicle
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April 04, 2012, 03:51:56 PM
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Someone with some real cash(like a bank) can easily kill bitcoin just by achiving 50% of hashrate or destabilize it by joining the biggest pool swealing it to 51%. Currently it wouldn't be so hard to do, it's just under the radar of big realworld intitutions.

It's not so easy. Right now Bitcoin is by far the most powerful computing network on Earth, so it would be extremely expensive to even briefly execute a 51% attack on their own.

Joining the biggest pool (deepbit) gives the decision-making power to the pool owner. So joining actually reduces their ability to attack - if the banks coerce the pool owner into attacking, everyone else joins another pool.

And we're not under their radar:
http://mobile.reuters.com/article/idUSBRE83108120120402?irpc=932

If anything, they'll try to embrace, extend, extinguish. An overt attack would be foolish.
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