Re:The Schism Over Bitcoin Is How Bitcoin Is Supposed to Work
by cookiecaper on Friday February 12, 2016 @07:38PM
(#11091763)
>Anyone is free to set up a larger mining operation if they are so inclined.
Sure, all they need are the tens of millions necessary not only to buy the equipment but also to develop their own competitive custom ASICs.
The biggest problem with btc mining is that it's no longer feasible to make an impact with commodity hardware. I think to the extent that Satoshi may or may not have foreseen that, he assumed that the specialized hardware would become commoditized and that users would still have the power to make a meaningful vote. This didn't happen because the Bitcoin network punishes a faster network with increased difficulty, so as soon as you release your ASIC to the masses, the network raises the difficulty to neuter the effects. However, if you keep your hardware private, you can profit from the hardware without making such a large impact that the network edges you out. This allows the biggest miners to find several blocks per day (which is 25 "new" bitcoins + any attached as fees).
Given those incentives, it's only logical that the best hardware would be used privately and that the vote of the everyday bitcoin user (who was also supposed to be a miner) is irrelevant.
Sure, all they need are the tens of millions necessary not only to buy the equipment but also to develop their own competitive custom ASICs.
The biggest problem with btc mining is that it's no longer feasible to make an impact with commodity hardware. I think to the extent that Satoshi may or may not have foreseen that, he assumed that the specialized hardware would become commoditized and that users would still have the power to make a meaningful vote. This didn't happen because the Bitcoin network punishes a faster network with increased difficulty, so as soon as you release your ASIC to the masses, the network raises the difficulty to neuter the effects. However, if you keep your hardware private, you can profit from the hardware without making such a large impact that the network edges you out. This allows the biggest miners to find several blocks per day (which is 25 "new" bitcoins + any attached as fees).
Given those incentives, it's only logical that the best hardware would be used privately and that the vote of the everyday bitcoin user (who was also supposed to be a miner) is irrelevant.