Please keep up. I never said they did or would be used.  

Just pointing out the claim that "the banks" (this single global banking entity) have more computing power than the Bitcoin network is false.  It is SPECIFICALLY because of specialized hardware (like GPU) and the fact that rigs are so efficient (in terms of cost per unit of Bitcoin work) that makes the claim in the OP false.

While "the banks" have hundreds of millions of dollars in general purpose computing hardware that hardware is ill-suited for attacking Bitcoin network.

If you understood cryptography you would understand how foolish that sounds. 


FPGA are quite expensive.  8TH of FPGA would cost in the ballpark of tens of millions of dollars.  No bank is going to spend tens of millions of dollars to attack Bitcoin.  They generally are worried about the bottom line and outside of an episode of Alias nobody justs blows off tens of millions of dollars of hardware to attack a network that 0.000001% of the planet is using.

Your response ... someday Bitcoin may be a threat. My response ... yeah and when Bitcoin is a threat the network will be 100x larger so the cost now won't be tens of millions but billions of dollars.

Well that is difficult to say because the Bitcoin network has no concept of the actual value being spent.  If I use a 100 BTC address to send you 1 BTC (99 BTC change) Bitcoin the network has no idea if that is 1 BTC or 99 BTC transaction.  It only knows 100 BTC total has been transferred.  So fees will likely never be based on transaction amounts however it is useful to consider the "average fee" relative to useful transaction amount.

To get some ballpark ideas.  A 0.1% "average effective fee" with Paypal level volume ($80B annually) that would be ~$80M in annual transaction fees.  Currently block rewards are worth ~$7M and that collectively "buys" us 8TH in network security.  Granted some miners are unprofitable and likely should quit on economic reasons so maybe it is more realistic to say that $1M in fees buys us ~0.5TH to 1TH in sustainable network security (circa 2011 computing power).

Remember Moore's law will make the nominal hashing power of network rise but we won't be any "safer".  If GPU are twice as cheap one would expect us to have 2x the hashing power but attackers can get 2x the hashing power just as cheaply so any analysis is based on computing power at the time.  The level of security is directly related to annual transaction fees and how much hardware/electricity that buys. So $80M in fees would "buy" us a network roughly 11x as secure as we currently have (in whatever the prevailing hardware of the future is).

Some discussion on future fees and how current setup is unsustainable:
http://bitcoin.stackexchange.com/questions/876/how-much-will-transaction-fees-eventually-be

Simple version the current fees structure ensure that one should never pay more than 1 satoshi for every transaction.  Also no miner has no incentive to exclude a paying transaction no matter how little it pays (unless some future network rules prohibited the transaction as invalid).  Given that dynamic almost all transactions will have a 1 satoshi.  It creates a tragedy of the commons where miners can't force higher prices because there is no disincentive to exclude even a transaction w/ a single satoshi as a fee.

To show how that is unsustainable; even if Bitcoin was worth $1,000 each, 1 satoshi is only 1/1000th of a cent.  To achieve just the current level of network security (costing ~$7M annually) would require 22,000 transactions per second (at BTC: $1K USD & 1 satoshi "average effective fee").

I think that is a dangerous route to go and can lead to forking the blockchain where part of network this X is bad and part think X is good.  Is subnets have "disagreements" on blocks in their fork you can see even more forking.  Also indentifying a double spend block on a global network w/ millions of daily transactions in real time is tough.

That can't be much more than "a random thought" though!

If the community were to include this, it would open the doors for fraud.  I could repeatedly send my coins from one address to another (all controlled by me).  I would do it very often so that my coins appear in many blocks.  They are all over the blockchain.

I would wait for someone to do a "bad thing".  When it happens, and with a bit of luck, my coins would figurate in the same block as the "bad thing".

Now I'm ready to spend my coins.  Quickly, and while the community still discusses about the "bad thing" and whether or not to use your poison block weapon.  With a bit of luck, the decision is yes.

And the bad block is nuked ...
And the link is broken ...
Home sweet home - my coins back in my wallet!

Think about it.

I think that some mechanism to feasibly include a blacklist or replacement list which could somehow take effect if a majority choose to do it may be worthwhile.  If very carefully considered and implemented that is.  This is effectively the same thing as a 'poison block' feature, I think, but possibly more usable.

The idea would be simply to provide a credible defense against an attacker thinking about amassing a sufficient degree of hashing power to attack the system against the will of the users.  The goal would be just to deter such an attempt since it would likely be futile anyway.

In other words, the expectation is that the list would never need to be used and someone sitting around 'waiting for a bad thing' would become old and grey before realizing any satisfaction.

That would make them look bad and would be good publicity for Bitcoin .