[Bitcoin-segwit2x] PROPOSAL: B0RG (Bitcoin zero replay, guarantee) - Ensuring a smooth 2X upgrade without a chain split

[Jacob Eliosoff]

The easiest way to think about this is, difficulty is a measure of how long
your rig takes to mine a block, and until the first difficulty
adjustment, *both
chains will have identical difficulty!*  Each will take equally long to
mine.  So *regardless* of overall hashrate split, a miner's short-term
incentive is to just mine the coin with the higher price.

In the longer run, difficulty will adjust so that each chain is producing
10-minute blocks, and the steady state will be where hashrate ratio follows
price ratio.  Eg, if B1X price stays 4x B2X, then the short-term-incentive
steady state will be where B1X has 4x the difficulty and 80% of hashrate:
ie, "mining B1X is a lottery you win 4x less often, with a prize 4x as
valuable."

But immediately post-split, short-term incentives may not dominate.  Many
miners don't sell immediately, so long-term price will influence them too.
This could benefit either B2X, if low tx rate/high fees make B1X unusable
and users shift to B2X; or B1X, if miners foresee B1X's price rising when
it makes it to the difficulty adjustment(s) & becomes usable again.  As
Adam said, higher tx fees may also give B1X an edge with miners (if people
are sending...).

In short, I think people overstate the short-term incentives - many miners
are in this for the long haul - but the post-split short-term incentive is
simple and *independent* of hashrate distribution: just mine the coin with
the higher price.


On Oct 24, 2017 1:01 PM, "David A. Harding via Bitcoin-segwit2x" <
bitcoin-segwit2x at lists.linuxfoundation.org> wrote:

> On Tue, Oct 24, 2017 at 09:27:37AM -0700, Erik Voorhees via
> Bitcoin-segwit2x wrote:
> > So if you consider it from a $ revenue per day:
> > - 1x finds 28.8 blocks per day (0.2x144) and earns 360 BTC1x, or $1.44m
> per
> > day ($4,000 x 360)
> > - 2x finds 115.2 blocks per day (0.8x144) and earns  1440 BTC2x, or
> $1.44m
> > per day ($1,000 x 1,440)
> >
> > Am I missing something?
>
> Umm, yeah.  2x did four times as much work to make the same amount of
> money as 1x.  By, "work", I of course mean that they expended four times
> as much electricity and tied up four times as much capital equipment.
>
> Maybe this isn't obvious since you're treating 1x miners and 2x miners
> as a group, but if you consider them as individual miners, it becomes
> clear that there's a strong incentive to defect to the more profitable
> chain.  For example:
>
>          Average daily blocks | 1x potential revenue  | 2x potential
> revenue
> -------+----------------------+-----------------------+-----
> ------------------
> Alice  |           5          |  5*12.5*4000 =   250k |  5*12.5*1000 =
> 62.5k
> Bob    |          10          | 10*12.5*4000 =   500k | 10*12.5*1000 =
> 125.0k
> Chalie |          25          | 25*12.5*4000 = 1,500k | 25*12.5*1000 =
> 312.5k
>
> You can replace "average daily blocks" with "kiloWatt hours (kWh) plus
> capital equipment depreciation costs" for a difficulty-neutral factor.
>
> -Dave
>
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