Thanks. This is a helpful link. If the majority of good/honest nodes and the Bitcoin developers decide to implement a change, presumably this change will occur. My understanding is this happened recently with Taproot for example so one must infer that this is possible. Obviously such changes only impact new blocks but naturally this can still have an impact on the general ecosystem.
Here is a hypothetical situation for consideration (please shoot holes in it!).
The year is 2105, Bitcoin is the defacto world currency. Everyone is paid in Bitcoin and all transactions are performed in Bitcoin. Democratically elected world governments control the majority hashrate since they have decided that it is too risky to allow private individuals to control the network.
A major financial crisis emerges in which prices of goods relative to Bitcoin are on a severe downward trend. Individuals realize that if they simply delay purchases, their own purchasing power will increase - further reducing demand for goods and services thus further decreasing price. Since businesses cannot make a profit in this situation, workers need to be paid less continuing the deflationary cycle.
Democratically elected world governments decide that inflation is necessary in Bitcoin in order to avoid an exceedingly long painful and unnecessary economic depression. World governments work with Bitcoin developers to start rewarding miners with 20 Bitcoin per block mined thus devaluing the currency. 99.9999% of citizens of the world agree with this move. After the financial crisis is abated, world governments determine that a 2% inflation rate should be built into the Bitcoin in order to avoid such problems in the future and virtually everyone is happy with this.
Changing the miner subsidy amount would require a hard-fork, so the chain would split in two chains with a shared history, the original with only 21M coins and the new chain without the cap. And once that happens, it would be in everyone's financial interest to get rid of their inflationary coins and sell them for original Bitcoin.
So unless all the world governments decide to make it illegal to mine the old chain, it wouldn't work.
I don't believe that a hard fork necessarily results in a split of the chain. If all miners accept the hard fork then there is no split in the chain - new blocks require miners. My understanding is this has happened before.
Yes, but as long as some miners stay on the old chain, it will live. Hard fork also requires the users to switch to that new client, otherwise they won't be able to accept the new blocks from the forked chain.
Basically exchanges and whales determine the outcome of a hard fork. In a "hyperbitcoinized" world there wouldn't really be exchanges and it's not clear who the whales would be, but that scenario is so unlikely that I don't think about it.
Nope, the 2X upgrade was derailed by an exchange that decided to list both sides (IIRC it was going to be BTC1 and BTC2) and they were motivated by a (possibly rigged) futures market.
How exactly was it derailed? Creators of 2X stopped the fork because it was clear that majority of users were against it and that miners would be forced to mine it at their expense.
I suppose that leads back to my original question. What are the names of the people that control Bitcoin? Should we wait until this group does something that is not in the best interest of Bitcoin holders to find out?
It is a problem IMO that Bitcoin has no documented governance process so it's basically "if it prosper, none dare call it treason". As for who the CEOs and whales are, you can Google them.
They could rewrite the protocol at-will if a cabal of miners holds a clear majority of the hash power.
If that cabal would require hundreds of groups with no common cause on every continent, then no problem. If it's just a handful of individuals who could make that call, that's a potential problem.
And we just don't know which end of that spectrum the current hash rate distribution actually looks like.
Admittedly, there's no reason a private investor would want to tank their holdings like that I can think of. But, if significant hash rate is being held by state actors as some have suggested, economic warfare comes into the picture.
No, that's literally not how it works. Read the article I linked.
Even if the cabal of miners decided to make a change in the protocol and print themselves bunch of free coins, those mined blocks would get rejected by the full nodes, which compose the Bitcoin network and validate all the transactions.
Here is a hypothetical situation for consideration (please shoot holes in it!).
The year is 2105, Bitcoin is the defacto world currency. Everyone is paid in Bitcoin and all transactions are performed in Bitcoin. Democratically elected world governments control the majority hashrate since they have decided that it is too risky to allow private individuals to control the network.
A major financial crisis emerges in which prices of goods relative to Bitcoin are on a severe downward trend. Individuals realize that if they simply delay purchases, their own purchasing power will increase - further reducing demand for goods and services thus further decreasing price. Since businesses cannot make a profit in this situation, workers need to be paid less continuing the deflationary cycle.
Democratically elected world governments decide that inflation is necessary in Bitcoin in order to avoid an exceedingly long painful and unnecessary economic depression. World governments work with Bitcoin developers to start rewarding miners with 20 Bitcoin per block mined thus devaluing the currency. 99.9999% of citizens of the world agree with this move. After the financial crisis is abated, world governments determine that a 2% inflation rate should be built into the Bitcoin in order to avoid such problems in the future and virtually everyone is happy with this.
Is such a scenario impossible?