Post
Topic
Board Bitcoin Discussion
Re: Is Bitcoin really unbreakable?
by
ebliever
on 30/05/2016, 03:10:05 UTC
Isn't it possible, even likely, that at some time in the future a majority of miners would simply implement software changes to increase the amount of bitcoins generated? The incentive to do so is rather large, is it not? Thoughts?

Not really. Let's think this through. Let's say 90% of miners decide to implement Bitcoin B, which increases the block reward tenfold. The other 10% of miners stick with bitcoin as it exists today (we'll call it Bitcoin A). The result is a hardfork and two competing blockchains. Exchanges and the general public are forced to decide which coin they want to go with. Some exchanges stick with Bitcoin A, some with Bitcoin B, some offer to handle both.

Because the miners on Bitcoin B have demonstrated they will jack with the coin supply, confidence is near zero that they won't do so again. That and the flood of new Bitcoin B's into the market from the miners quickly drives the price down towards zero. Meanwhile, the miners on Bitcoin A see the value of their coin sustained, and they are earning 10X as many bitcoins because of the lack of competition. Rather quickly the humiliated and financially stressed miners of Bitcoin B start abandoning their ill-conceived effort to alter the supply of bitcoins. Within a few weeks, Bitcoin B ceases to exist.

The public could support a restriction on the block reward, reducing the coin supply, in principle. But so long as anyone was willing to mine the existing protocol and exchanges were willing to support it, I can't see the opposite happening. Except maybe if world governments stuck a gun to the head of miners, exchanges and the public and said "You will accept only Bitcoin B - or else."