What if a large number of miners were suddenly forced to shut down?

[pandalion98]

95% of miners are suddenly offline.
Be it a new law or an EMP strike. What would happen to bitcoin? 

That is impossible to happen and even if it would, nothing impotant would happen , new miners would rush for free money.

So you are saying there is an equivalent of 95% of todays hashingpower somewhere in a warehouse just waiting for this to happen?

No. I just asked a hypothetical question.

[FattyMcButterpants]

Value would increase? With a sudden cap on "incoming" currency, I think the economic value would substantially increase.

I don't think so, since it would be bad PR for Bitcoins. Transaction would take longer to confirm, which would really hurt.
But the difficulty is adjusted every two weeks, so the effect on the network would be gone after that period, but still bad PR.

This is not true. The difficulty adjusts every 2016 blocks so that the previous 2016 blocks would have been mined in two weeks had the difficulty be what it was changed to. Assuming that 95% of the miners go offline exactly as the difficulty chances and ignoring variance, and assuming that no additional miners come online or go offline then it would take 40 weeks for the difficulty to adjust.

However the likely result of the miners going offline is that the TX fees would skyrocket which would entice other miners to go online as the EV of mining would increase.

Does this mean confirmation will take about 3-4 hours?

On average a confirmation would take 200 minutes, yes.

That'd be a hassle I guess. Zero-confirmation services would then explode, correct?

Probably not. The nodes will eventually delete the unconfirmed transactions from their memory pool so accepting an unconfirmed transaction would be much riskier as it would be much easier to double spend a transaction.

[inBitweTrust]

That'd be a hassle I guess. Zero-confirmation services would then explode, correct?

No, off the chain transactions would explode and alts would start to get adopted at higher rates.

[Soros Shorts]

If this were to happen, I am certain that we would never get to see the theoretical 40 week wait till the next difficulty adjustment. ASIC factories would ramp up production (of current proven designs) in response to demand and quickly make up for most of the loss of hashing power.

[Febo]

Value would increase? With a sudden cap on "incoming" currency, I think the economic value would substantially increase.

lol. price would fall since those miners would get coins much cheaper then right now and bitcoin would become more vulnerable to get attacked. But since would be worth less, would be also less profit for the attackers.

[shorena]

So you are saying there is an equivalent of 95% of todays hashingpower somewhere in a warehouse just waiting for this to happen?

Nope, im saying if mining would be 95% easier new miners would pop quicker than you can think of

True, I suspect that as well. I however doubt that it would be enough to reach "100%" again.

If it would be "easy" to gather as much hashingpower as currently is around a 51% attack would be "easy" as well. I doubt recovery would be a matter of days, weeks or even months are more likely.

[Soros Shorts]

So you are saying there is an equivalent of 95% of todays hashingpower somewhere in a warehouse just waiting for this to happen?

Nope, im saying if mining would be 95% easier new miners would pop quicker than you can think of

True, I suspect that as well. I however doubt that it would be enough to reach "100%" again.

If it would be "easy" to gather as much hashingpower as currently is around a 51% attack would be "easy" as well. I doubt recovery would be a matter of days, weeks or even months are more likely.

I can live with 20 minute confirmation times, so recovery to 50% is good enough for me.

[darkmule]

Nope, im saying if mining would be 95% easier new miners would pop quicker than you can think of

People might wait until it was worth the cost of electricity, but you might see a lot of previously "obsolete" mining equipment go back online.

[FattyMcButterpants]

That'd be a hassle I guess. Zero-confirmation services would then explode, correct?

No, off the chain transactions would explode and alts would start to get adopted at higher rates.

You are probably correct about off chain transactions, however I disagree with alts being used more as they would likely have similar levels of security (there is no reason why only bitcoin miners and not altcoin miners would shut down)

[fenican]

Tough to say - any event that took out 95% of miners would be a global catastrophe which, generally, should spike the value of "flight to safety" assets such as gold and silver and ... Bitcoin?

[Flashman]

Best hedge against a 95% global meltdown is several years supply of canned food and bottled water... gold and silver probably only useful up to 70% meltdown.

[turvarya]

Value would increase? With a sudden cap on "incoming" currency, I think the economic value would substantially increase.

lol. price would fall since those miners would get coins much cheaper then right now and bitcoin would become more vulnerable to get attacked. But since would be worth less, would be also less profit for the attackers.

No, they wouldn't unless the difficulty changes, which could take months.

[inBitweTrust]

You are probably correct about off chain transactions, however I disagree with alts being used more as they would likely have similar levels of security (there is no reason why only bitcoin miners and not altcoin miners would shut down)

Why are you assuming all alts use PoW as a security mechanism?

[Biitcoin]

Price will rise for sure when there isn't too much BTC (miners stop) . demand on bitcoin will rise & eventually price too right ?

[inBitweTrust]

Price will rise for sure when there isn't too much BTC (miners stop) . demand on bitcoin will rise & eventually price too right ?

Until difficulty re-adjusts less bitcoins will be minted which could drive price up but the fear from this loss in security and instability of the network could create a panic sell driving BTC price down as well.

It is hard to say what will happen if that event occurs with the BTC price. This is a completely unlikely hypothetical discussion however.

[bf4btc]

You are probably correct about off chain transactions, however I disagree with alts being used more as they would likely have similar levels of security (there is no reason why only bitcoin miners and not altcoin miners would shut down)

Why are you assuming all alts use PoW as a security mechanism?

Even if an altcoin was using something other then PoW then it would still be similarly affected. PoS coins still need a minimal amount of computing power to "stake" and it is not realistic to think that only ASIC's would be affected by some event that would cause 95% of the mining network to suddenly go offline

[inBitweTrust]

Even if an altcoin was using something other then PoW then it would still be similarly affected. PoS coins still need a minimal amount of computing power to "stake" and it is not realistic to think that only ASIC's would be affected by some event that would cause 95% of the mining network to suddenly go offline

Fair point but the question would be which currencies security model would be far more effected by 95% of the PoW or 95% of the PoS/DPoS/ect... being removed?

I would posit that Bitcoin would be far weaker under said conditions from a 51% attack and thus you would likely see more people adopt alts in such an event much to my chagrin.

[Razick]

Value would increase? With a sudden cap on "incoming" currency, I think the economic value would substantially increase.

Since difficulty would adjust the amount of new currency would be the same. The network would be less secure and therefore the price would likely fall.

[funtotry]

Price will rise for sure when there isn't too much BTC (miners stop) . demand on bitcoin will rise & eventually price too right ?

I would think the price would decline as the network would become much less secure (by a factor of 20) and it would take much longer (and more expensive) to get a transaction to confirm.

[wadili89]

If this were to happen, I am certain that we would never get to see the theoretical 40 week wait till the next difficulty adjustment. ASIC factories would ramp up production (of current proven designs) in response to demand and quickly make up for most of the loss of hashing power.

Whats the 40 day wait? If it doesnt retarget in 40 days it forces a difficulty change? I was not aware that such a scheme is implemented.