Quote from: marilyn4325 on February 10, 2018, 01:30:46 PM

... Miners would just shut off their equipment if it isn't profitable anymore. This would reduce the global hashrate, so the remaining miners, the ones who are probably heavily invested in hardware, would make more bitcoins per hash, and it would be profitable again. ...

Thank you for your reply.

Nonetheless I disagree with your view, especially with the bolded part. Miners won´t simply
shut down their operations when it is unprofitable. Combined they have invested hundreds of
millions of $ into mining hardware and other infrastructure.

Let´s imagine a big miner in China with the following properties:
-he owns a few buildings and has signed a lease for several years
-he has bribed the local officials or acquired an actual license
-he has a staff and every staff member has an employment contract
-he has invested 50M $ into mining hardware
-he has invested money into other infrastructure in order to enable a smooth mining operation
...

Do you really think that if mining becomes unprofitable he will simply call it a day? After all it could
only be unprofitable for a short time if the price rises again. He is heavily incentivized to prop
up the price and so is every other miner, who would be in the exact same situation.

In short my claim that the bolded part of your response is wrong is based on the fact that nobody, who
has invested millions of $ into something will just shut down their operations and leave. Instead he would
do everything in his power to make it profitable again, or to ensure the continuation of his business
in other ways (e.g. ordering even more ASICs in order to mine more blocks).

The capital that is needed to keep the BTC price above a certain level is a fraction of
the amount that the miners stand to lose if the Bitcoin price falls below the average cost
of mining a single Bitcoin for a longer time frame.