Well, if nothing else, my short-cutting the description of the threat was not universally successful, since a fully qualified person (you) paid attention rather than one of the ignorant masses that inhabit the space spewing all kinds of silliness.
So, what you say is entirely true and besides the point. The problem is more related to the blind assumptions that the game-theoretic beliefs around PoW crypto. Initially, I thought I could simply point out that a) it was not a good thing to have a totalitarian political system controlling more than 2/3 of the mining and b) it has clear incentives to use this in a way that benefits it politically. And, as a result of pointing out b), I thought I could move (informed intelligent) people to understand the problem more broadly.
The problem is therefore not making up the loss of Chinese miners per se. It’s their ability to manipulate the entire system at will: they can drop, the hash rates of the majority of mem pools and then raise them quickly as well. And continue doing this.
The economic impact of this alone would have all kinds of possible effects. Most simply would be the “value” of BTC, ETH, etc. This can easily create all kinds of havoc. After all, the objective is not to take down the system per se, it is to destroy trust in it. China is in no way exposed to this problem: because they have outlawed crypto in all ways except the mining operations which are politically and economically insignificant. They employ very few people (except for dual use folks making ASICs) and financially it’s a small industry. And they are happily fiddling with far greater entities in these respects (Alibaba, Hong Kong, etc.) with little concern.
It is even possible theoretically to (even temporarily) fork the chains. Rather than me re-explaining this, you can read:
This is the one view https://www.cs.cornell.edu/~ie53/publications/btcProcFC.pdf
And this is one that remarks on several issues:
https://medium.com/@0xdhruvluthra/the-future-of-bitcoin-mining-61be857a4f97
I would love to hear your thoughts on this.
