bitcoin's decentralized consensus mechanism works based on some intentively elaborated incentive structures. The first and fundamental rule is that the chain with the greatest amount of work is correct. This single rule avoids the need for a central referee, determining which chain is correct based on the efforts of thousands of decentralized parts, each trying to extend the block chain. The subsidy to the miners continues to advance the block chain, creating painful opportunity costs for miners who do not extract the tip. These mechanisms, together with the difficulty adjustment, establish the theoretical framework of the game for a chain that has advanced, 1 block in time, with almost 100% clarity during the last 15 years.
The only warning is that if a miners or coalition of miners can gather more than 50% of the hashrada, it will have the ability to overwrite recent blocks, prohibit other miners write future blocks and determine which transactions are recorded in the canonical main book. This would be a disaster, obviously; The full point was to avoid a situation in which one part had control. Then, the last binding piece of game theory designed by Satoshi is that there is some incentive to prevent this from happening. As described in the technical document:
The incentive can help encourage nodes to stay honest. If a greedy attacker can gather more power from the CPU than all honest nodes, he would have to choose between using it to disappoint people stealing their payments or using it to generate new currencies. You should find more profitable play with the rules, those rules that favor it with more new coins than all the other combined, than to undermine the system and the validity of its own wealth.
I should find that it is more profitable to play with the rules
In fact, this is the basis of the entire game theory in bitcoin. bitcoin makes sense if and only if, at some point, at least 50% of the miners are encouraged to stay honest. This has been the case since 2009.
A subdiscutinated part, but perhaps the most crucial of the theory, is the reason why you should find more profitable to play with the rules. The answer, in 2009, 2010, 2011, and every year since then it has always been the same: because if he did not, he would break. If it breaks, the bitcoin experiment is over and the miner who did this would become the proud owner of a landfill full of electronic waste without value. This is what Satoshi referred to, and that is why the community panicked in 2014 when Ghash's group exceeded 50% of the hashrate. The idea that a part (even if that is a group) could take care of the system represented such a disastrous failure that everyone tries to avoid it.
In game theory, it is understood that theoretically someone could, perhaps with significant costs, direct more than 50% of the hashrate to behave dishonestly, forcing a constitutional crisis. But the natural result of this crisis is the mutual destruction insured for all miners and holders. This is the last deterrence for bad behavior.
Keep in mind that the theoretical possibility of a 51% attack is eternally present, regardless of the current hashratic, the costs of electricity, cooling or ASIC new. This is a tautological consequence of the fact that 51% <100%: at any time, a group with malicious intentions could be created, and 60% of miners could join this group. The fact is that in recent times, 100% of the miners are undermining by choosing the tip. It is always a matter of incentives, not physical plausibility.
For those outside the system, they do not have ASIC, the security model forbids them to attack the system. But the security model is designed not only to protect from external threats (after all, it is an open system) is designed to protect from the actors inside The system too. Miners not only protect the non -mining system, but protect the system from other miners.
Consider selfish mining. It is mathematically demonstrated that this technique gives an advantage to a group of 34% of the miners who execute this technique beyond a period of difficulty adjustment. Selfish mining does not imply explicit robbery or even censorship, only a better roi for the miners who would form the coalition. Recent reports have put the mining participation of the main mining corporations of public property in about 30% and growing. Add some large private miners and reach the selfish mining threshold. Is it that selfish mining is inevitable? All that is required is that a collection of miners that comprise 34% to get on a call and initiate the process; Three weeks later they are reaping the rewards. However, until now no group of miners has tried to prove this. Why is this?
Selfish mining would represent a great violation of the norm; Crossing this line would take bitcoin to an unpleasant place where competitive groups are hitting him. The winner's grand prize is monopoly control, under which the monopoly miner can maintain all the rates and block subsidies, can relieve their hashrate to increase profits and you can even negotiate rates directly or even establish their own rates . But this would be a bitcoin disaster; For this reason, no one is starting that call.
I wrote a chapter in my book on coalition games theory, analyzing exactly this problem with respect to Monopoly mining. The analysis is reduced to a comparison of accumulated profits with a 51% coalition that divides the rewards of a monopolized chain, or the small accumulated profits for the large coalition if they adhere to the competitive course. In the first days, the answer was clear: monopoly mining would have destroyed everything, so there is no incentive for a coalition to form.
Enter USG
If the USG undertakes to a plan, for years and decades, to invest in bitcoin, they will have created something that cannot fail. It simply can't. Regardless of whom Mianea bitcoin, who has a price, which parts use the chain, cannot fail and will not fail. If there is a constitutional crisis on mining, this crisis will be resolved and will be resolved in a very clear and definitive way.
There are enough ways to resolve a constitutional crisis, when it expands its window to include centralized options. In the first days, these options would have been ruled out as inferior to the fault, but if the fault is not an option, all options can and will be considered. A simple brute force statement of 51% of power by the miners controlled by USG and USA. It is an option (this does not need to require censurial monopoly mining). Another viable solution is a soft permitted bag that only allows new blocks of miners that are negotiated publicly. Obviously, the participation test is on the table. Another option would be to convert the UTXO of bitcoin into a CBDC whose transactions are confirmed by the Fed. This would bring bitcoin to the masses at the speed of the lightning and would provide a massive value to the early holders.
The point is that under this regime, monopoly mining is no longer a failure per se. Any coalition of miners could pursue monopoly mining, starting with selfish mining and the snowball its 51%coalition. As long as they do nothing that directly irritates the USG, they cannot break the system. If they achieve monopoly mining, the USG is still there, with the support of bitcoin.
In summary, the USG gets angry with the success of bitcoin decades in the future eliminates bitcoin's last weapon against centralization; Your option to fail.
It is difficult to imagine that miners fighting for small profit margins would continue with the decentralization theater, when they should find more profitable forming a coalition and a monopoly mine, which strictly speaking, is not even against the rules.
This is an guest publication of Micah Warren. The opinions expressed are completely yours and do not necessarily reflect those of btc INC or bitcoin magazine.